Pharmacy Services

For more than four decades, Myers and Stauffer has provided complex data analysis, fiscal modeling, and rate setting services for pharmacy programs. We have a team of pharmacists, accountants, and analysts who have a clear and thorough understanding of the complex pharmacy landscape. We have pioneered innovative pharmacy reimbursement strategies that are based on actual drug acquisition costs and the expenses pharmacies incur when dispensing prescriptions. Our work has led to substantial program savings for our clients and has also created a shift in how pharmacies are reimbursed across the nation.

The rising cost of prescription drugs and the need for drug pricing transparency is at the forefront of the national health care policy debate. As new and innovative products come to market, reimbursement and policy decisions must keep pace. Myers and Stauffer is in an unparalleled position as the sole contractor to the Centers for Medicare & Medicaid Services (CMS) for the development and maintenance of the National Average Drug Acquisition Cost (NADAC) pricing benchmark to assist states in this quickly changing environment.

Pharmacy Benefit Oversight 

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Allan Hansen


For more than four decades, Myers and Stauffer has assisted state Medicaid agencies and other state-sponsored health plans with pharmacy benefit oversight and consulting services. As more states move their Medicaid populations into managed care, it is increasingly important that states monitor the pharmacy benefit provided through managed care organizations and their contracted Pharmacy Benefit Manager (PBM). We work to ensure transparent reimbursement rates, to identify the use of spread pricing practices and to identify other improper pharmacy claims payment practices. For states considering the use of a single PBM model for their Medicaid pharmacy program, our team of professionals can assist states with oversight of implementation, readiness reviews, compliance reviews and other support services. We can work directly with your state Medicaid agency, state employee health plan or other government-sponsored pharmacy program to ensure greater pharmacy benefit accountability and payment accuracy. We have assisted states with a review of other managed care pharmacy issues including pharmacy benefit manager (PBM) contracting models, pharmacy reimbursement by PBMs and issues related to the use of 340B pricing within managed care pharmacy plans.

Rate Setting and Reimbursement

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Allan Hansen


We provide rate setting and consulting services to assist state Medicaid programs with transparent reimbursement methodologies and fiscally sound policies for both fee-for-service and managed care pharmacy programs.

Myers and Stauffer is the original developer of the average acquisition cost (AAC) methodology for state Medicaid pharmacy pricing. Our extensive experience with pharmacy AAC programs is further evidenced by our role as the sole contractor to CMS to develop and maintain the NADAC pharmacy pricing benchmark. We have also conducted more than 100 pharmacy cost of dispensing survey projects in more than 30 states. Whether providing rates for pharmacy ingredient reimbursement or cost data to support the establishment of professional dispensing fees, our pharmacy reimbursement team works from the premise that rate setting must be accurate, transparent, and predictable, while simultaneously demonstrating that payments are sufficient to support the delivery of high quality, cost-effective services and promote good health outcomes. The fundamental accounting principles used in all the firm’s rate setting engagements are also applied within our pharmacy practice.

Our pharmacy consultants have assisted states with a review of clinical and financial policies across both fee-for-service and managed care pharmacy programs to help Medicaid programs achieve ideal outcomes and goals of drug pricing transparency. This has included a review of preferred drug price list policies and across pharmacy programs to determine the potential for alignments that might benefit members and providers with uniform policies across plans as well as maximize drug rebate opportunities. We have assisted states with a review of other managed care pharmacy issues including pharmacy benefit manager (PBM) contracting models, pharmacy reimbursement by PBMs and issues related to the use of 340B pricing within managed care pharmacy plans. Our pharmacy practice covers many facets of reimbursement including:

  • Average acquisition cost/state maximum allowable cost pricing methodology.
  • Specialty drug and clotting factor reimbursement.
  • Cost of dispensing surveys and professional dispensing fee consulting.
  • Preferred drug list review and alignment consulting.
  • Review of Medicaid managed care/PBM contracting and reimbursement policies.
  • Consulting for 340B and value-based purchasing issues.

Audit and Attest

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Andy Ranck, CPA


Our pharmacy audit team is highly trained and knowledgeable about pharmacy and health care. Our team includes highly skilled and experienced pharmacists on each pharmacy engagement to offer clinical expertise during the course of the project. Our pharmacy audit services include:

  • Pharmacy benefit manager (PBM) audits.
  • 340B claims audits.
  • Procedure coded drug/NDC coded drug claim audits.
  • MCO pharmacy benefit contract compliance audits.
  • Medicaid drug rebate performance auditing and consulting.

Benefit/Program Integrity

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Ryan Farrell, CFE


Through our benefit/program integrity services, Myers and Stauffer is able to assist our government health care clients with identifying pharmacy-related improper payments and detecting instances of potential fraud, waste, and abuse. Leveraging tailored data analytics and employing subject matter expertise, we evaluate claims for a variety of potential issues including: adequacy of documentation, dispensing of brand name drugs versus generic equivalents, and quantity accuracy. We identify and investigate the potential diversion of narcotics, anti-retroviral, and other high-dollar medications. Further, we develop and evaluate the design and operations of pharmacy lock-in programs, whether operated by an agency or a managed care organization, as well as identify candidates for placement into the program. Our services include:

  • Claims analysis.
  • Post-pay claims audits – clinical/financial.
  • Pre-pay claims audits – clinical/financial.
  • Medicaid recovery audit contractor (RAC) services.
  • Software modules for surveillance and utilization review subsystem (SURS), fraud, waste, and abuse
    detection services (FADS), and case tracking.
  • Provider compliance.
  • Payment system processing accuracy.
  • Fraud, waste, and abuse detection (FWAD) litigation support.
  • Lock-in.

Managed Care Oversight and Compliance

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Mike Johnson, CPA, CFE

Pharmacy services delivered in a managed care environment can sometimes create unique challenges. This service delivery model typically requires an additional layer of oversight due to the manner in which most managed care plans delegate prescription drug services to a third party PBM. Analyzing the administrative and medical loss payments can be challenging yet is important in order to ensure the appropriate safeguards are in place for pharmacy network adequacy and access to services. Myers and Stauffer’s managed care team has experienced these issues firsthand. We have successfully on-boarded managed care plans and conducted on-going operational reviews. Myers and Stauffer offers a comprehensive portfolio of managed care oversight and compliance services, which can be applied generally to all provider categories, but also to pharmacy. These services include:

  • Encounter data reconciliation and validation.
  • Financial audits, performance audits, and program effectiveness audits.
  • Network adequacy assessments and member access compliance.
  • Readiness reviews.
  • Claims payment and denial assessments, accuracy, and timeliness.
  • Medical record review.
  • Grievance and appeals analysis.
  • Contract compliance.
  • Other provider-specific issue review and resolution activities.