Authorized Distributors for Diabetic Test Strips

Invoice audits focusing on diabetic test strips are common in the PBM world. PAAS National^® believes the PBMs and manufacturers have two purposes for requesting these invoice audits. They are checking for inappropriate billing practices (wrong NDC) and inappropriate sources of inventory (unauthorized distributor).

The newest audit PAAS has seen is coming from manufacturers of test strips that offer rebate contracts with pharmacies for Medicare/Medicaid claims. These audits are very similar to other PBM invoice audits, in that they request invoices from authorized distributors for test strips dispensed during the specified timeframe. Since the manufacturer knows the number of rebates paid, they can easily identify potential shortages. Pharmacies without a valid explanation will be required to repay their rebates and will potentially lose their ability to purchase Medicare/Medicaid-only test strips.