Report 95011 Summary - August 1995

Department of Health Services:

Drug Treatment Authorization Requests Continue to Increase

The Bureau of State Audits (BSA) presents the ninth in a series of semiannual reports evaluating the way the Department of Health Services (department) processes reimbursement requests for certain prescribed drugs under the California Medical Assistance Program (Medi-Cal). These requests are known as drug treatment authorization requests (TARs).

In response to Chapter 716, Statutes of 1992, we obtained from the department statistical information, compiled each month, concerning both the number of drug TARs received and the number processed from June 1990 through May 1995. This report focuses on the drug TARs processed during the six months from December 1994 through May 1995.

The department received 321,362 drug TARs from December 1994 through May 1995. This figure represents an increase of 242,864 (309 percent) drug TARs over the first sixmonth review period. Also, the number of drug TARs received from December 1994 through May 1995 exceeded the number received during the previous reporting period, June through November 1994, by more than 110,000 (an increase of 53 percent). According to the chief of the department's MediCal Operations Division, Northern Field Operations Branch, this dramatic increase in the number of drug TARs received was attributable primarily to a change in the governing code, which reduced the number of prescriptions allowed per beneficiary per month for most contract drugs. Since November 1994, a drug TAR is required whenever the beneficiary's monthly prescription limit is exceeded. A drug TAR is also required for drugs that do not appear on the Medi-Cal list of contract drugs. A 44 percent increase in the number of people eligible to obtain drugs through MediCal (approximately 1,613,472) may also be a contributing factor in the increase of drug TARs received.

From December 1994 through May 1995, the department processed 324,144 drug TARs. This figure represents an increase of 246,862 (319 percent) over the first sixmonth period reviewed. It also represents the highest level of activity during that time. The department's backlog consisted of 2,311 unprocessed drug TARs in November 1990. In comparison, its backlog of unprocessed drug TARs in May 1995 was 1,113.

The department implemented new policies in April 1995, one of which concerns drug TAR processing time. The department's policy now states that all drug TARs will be processed within one working day. Specifically, the department requires that any drug TAR received before 5 p.m. on a working day will be processed by 5 p.m. of the following working day. The department defines a working day as one on which the MediCal Drug Section is open for business and excludes Saturdays, Sundays, and state holidays. Before April, the department's policy required the processing of all drug TARs received by fax and the department's audio response telephone system (Voice Drug TAR System [VDTS]) within 24 hours and the processing of mailed-in drug TARs within five working days.

During the sixmonth period of December 1994 through May 1995, both of the department's drug units (located in Stockton and Los Angeles) generally met the state requirement for processing mailedin drug TARs. Based on samples of mailed-in drug TARs that we randomly selected at each drug unit, we found that the Stockton drug unit met the requirement 99 percent of the time and the Los Angeles drug unit met the requirement 97 percent of the time.

Based on samples of drug TARs randomly selected at each drug unit, we found that the Stockton drug unit processed 92 percent of the fax drug TARs within 24 hours of receipt. For the fax drug TARs for which processing time exceeded 24 hours, the Stockton drug unit processed almost all within the one working day required by the new department policy. We also found that the Los Angeles drug unit processed only 53 percent of the randomly selected fax drug TARs within 24 hours of receipt. However, the Los Angeles drug unit processed 89 percent of fax drug TARs received in April 1995 within the one working day required by the new department policy. The average turnaround time for all fax drug TARs reviewed at Los Angeles was 29 hours. The Los Angeles drug unit attributed the extended processing time primarily to equipment limitations. However, during the sixmonth period of our review, the unit did acquire four new fax machines (two additional units and two replacement units). Finally, during January and April 1995, the Los Angeles drug unit generally met the 24-hour turnaround requirement for drug TARs received via the VDTS. For our sample of 139 VDTS TARs, 97 percent were processed within 24 hours.

In response to Section 14105.42 of the Welfare and Institutions Code, the department provided us with information regarding the number of fair hearing requests that beneficiaries made to appeal a denied drug TAR. Eighty-four fair hearing requests were submitted to the Department of Social Services from December 1994 through May 1995. Because the time to process drug TARs has been shortened, the department received few complaints from providers during the period December 1994 through May 1995.


Report type

Report type
















© 2013, California State Auditor | Privacy Policy | Conditions of Use | Download Adobe PDF Reader