The Bureau of State Audits presents the fourteenth 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).
The department received 447,318 drug TARs from June through November 1997, an increase of 368,820 (470 percent) over that of our first six-month review period eight years ago, from June through November 1990. There are two major reasons for the increase. Although the number of Medi-Cal beneficiaries has been decreasing recently, it is still higher than during the first review period. Also, in November 1994, the law reduced the limit of prescriptions from ten to six per month that an individual beneficiary could have before a drug TAR had to be submitted.
The department also processed 443,943 drug TARs from June through November 1997, an increase of 366,661 (474 percent) over that of the first six-month period we reviewed. The current number represents the most activity since June through November 1990; however, the increase is only 3,641 (less than 1 percent) more TARs than were processed during the previous six-month period.
While the number of processed drug TARs has risen substantially since June 1990, the percentage of unprocessed drug TARs compared to drug TARs received continues to remain low. The average month-end backlog for the current review period was 6.2 percent of all drug TARs received. This represents a significant improvement over previous periods when we found average backlogs ranging from a high of 34 percent in May 1992 to a low of 5.1 percent in November 1993.
Neither the Los Angeles nor the Stockton drug unit was able to process all drug TARs within one working day, as required by department policy. The Los Angeles drug unit took two working days to fully process 29 (4 percent) of the 731 drug TARs sampled that were either mailed or submitted via facsimile (fax). According to its chief pharmaceutical consultant, the delay in the Los Angeles drug unit was caused by the slow system response time of the department's contractor for data entry-Electronic Data Systems (EDS). The EDS system was completely down for most of a day during October. The Stockton unit also took longer than one working day to fully process 15 (2.4 percent) of the 624 mailed or faxed drug TARs sampled. However, the decisions about these 15 drug TARs were available to the providers through the Provider Telecommunications Network on the first day.
Additionally, we found that the number of fair-hearing requests went up during this latest review period. From June through November 1997, beneficiaries submitted to the Department of Social Services 106 fair-hearing requests appealing denials of drug TARs. This figure represents an increase of 35 (49 percent) over the prior review period of December 1996 through May 1997.
We recommend that to ensure it is promptly processing drug TARs, the department continue to work with EDS to resolve problems with computer and data transmission equipment at the Los Angeles field office and to monitor closely the scheduling of data entry staff so that the department can process drug TARs within the required time frame. We also recommend that when its current contract ends, the department negotiate turnaround time provisions into the next contract that more closely match its policy of one working day.