Pharmacy credentialing — challenges and opportunities

Under the Centers for Medicare and Medicaid Services regulations (42 CFR 455 Subpart B) to prevent provider fraud, waste and abuse, as well as to benefit patient safety, pharmacy benefit managers and payers must validate the credentials of pharmacies and any person with an ownership, control interest or managing employees within their networks.


This is a necessary measure to ensure they are in good standing with all applicable state and federal laws and meet quality performance standards, but it presents quite a few challenges for the industry.


Challenges we’re facing

Examples of required information on each pharmacy include, but are not limited to, contact information, vendor specifics and questions regarding pharmacy operations, such as business hours and languages spoken. The data collection for pharmacy credentialing, as well as the ability to easily update this information, requires significant time and resources for pharmacies and payers and results in certain operational inefficiencies for both sides. 


For example, for chain pharmacies, collecting and inputting the mandatory data requires an estimated 45 minutes — or longer. To illustrate the scope of this undertaking, consider that a well-known retail pharmacy with more than 4,500 locations would require more than 3,400 hours of labor to meet requirements. That’s the equivalent of 85 40-hour weeks.


Among the challenges also is a lack of industry standards on how to submit, deliver and receive information, as well as a requirement for PBMs to maintain credentialing information not just for the pharmacy and pharmacist, but also for such pharmacy staff as owners and managers. 


What is available?

Under the current approach, PBMs collect data from their network pharmacies using batch spreadsheets, as well as attesting they meet requirements through internal checks. Additionally, pharmacy services administrative organizations collect and provide pharmacy information while some independent operators utilize internal, PBM-created portals to enter information. 


One pharmacy resource currently collects the information needed to begin the credentialing process. It includes an online portal that allows chains to update owner information for all stores within chain code. Each pharmacy must then complete pharmacy- and pharmacist-specific information. 


Another current solution fills in some additional requirements, with capabilities that include verifying pharmacy and pharmacist primary Drug Enforcement Agency registration, as well as licensing information for the state in which the pharmacy is located. 


Once the data is collected, the LexisNexis Provider Integrity Scan can be used to both complete the credentialing and facilitate compliance with the CMS mandates that Medicare, Medicaid and CHIP providers be screened for their risk of committing fraud, waste and abuse before being allowed to enroll in a federal program. 


How can we simplify the process?

All the required data can be collected across a variety of platforms and processes, but currently there is no single solution that can save pharmacies and pharmacists time and reduce duplication of effort. The ideal solutions would:

Create a batch process to collect pharmacy data;

Obtain, clean and update data from PBMs and/or pharmacy chains;

Improve the response success rate by offering a pre-populated portal for pharmacy use; and 

Establish a centralized end-to-end aggregation process to assist pharmacies and PBMs/payers to collect the data, and help PBMs/payers to validate it. 


The solution also would need to be flexible enough to accept information on behalf of the pharmacist and still meet the regulatory requirements. As our experience in the payer-provider area shows, it often is not the physician who is inputting data but rather an office manager or administrator. As an added benefit, the ideal credentialing solution would minimize future disruptions by allowing for the input of “smart” attributes that might minimize future pharmacy disruption. 


Developing a “one-stop shopping” solution for the credentialing process should be the ultimate goal, and we welcome collaboration with any stakeholder to improve the current process. Solving this challenge would benefit PBMs, payers and pharmacies, as well as patients.  

Bobbie Riley, RPh, is vertical market lead, pharmacy, for LexisNexis Health Care.

Tom Suk is the senior director, product management, for LexisNexis Health Care.