The Bureau of State Audits presents the 15th and final 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 504,644 drug TARs from December 1997 through May 1998, an increase of 426,146 (543 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, the number is still higher than during the first review period. Also, in November 1994, the law reduced the limit of prescriptions, from 10 to 6 per month, that an individual beneficiary could have before a drug TAR had to be submitted.
The department also processed 497,405 drug TARs from December 1997 through May 1998, an increase of 420,123 (544 percent) over that of the first six-month period we reviewed. The current number represents the most activity since June through November 1990 and is 53,462 (12.1 percent) more TARs than the department processed during the previous six-month period.
Although the number of processed drug TARs has risen substantially since June 1990, the percentage of backlogged drug TARs has fluctuated, ranging from a high of 34 percent of the TARs received in May 1992 to a low of 1.6 percent in November 1995. Backlogged drug TARs are those TARs that have been received and logged in by the department but not fully processed as of 5 p.m. on the specific workday that the TARs were received. While the average month-end backlog of 11.9 percent for the current review period represents a significant improvement over some previous periods, it also represents an increase in the size of the backlog for the fifth consecutive review period.
The department's policy is to process all of the drug TARs within one working day. However, the department was unable to accomplish this for all of the TARs we sampled during this audit, or we were unable to determine when processing was complete. For 97 of the 2,784 drug TARs we sampled, we could not determine the time of day that the Los Angeles pharmaceutical consultants reached their decision to approve, deny, modify, or defer. The Stockton drug unit, because of the increased volume of drug TARs received, and because of a lack of available data-entry staff during this review period, could not process all drug TARs within the required one working day. The unit took up to four working days to fully process 565 (20.3 percent) of the 2,784 drug TARs we sampled that were either mailed or faxed. According to its chief pharmaceutical consultant, the department's contractor, Electronic Data Systems (EDS), lacked available data-entry staff to fully process all TARs throughout this period. Although staff had not fully processed the TARs, they entered the decisions for 560 requests into the Provider Telecommunications Network. This information was available by phone to any provider within one working day. The decisions on the remaining 5 drug TARs were available within four days.
It is not surprising that the number of fair-hearing requests also rose during this latest review period because the number of drug TARs processed increased by 12 percent. From December 1997 through May 1998, beneficiaries submitted to the Department of Social Services 125 fair-hearing requests regarding drug TAR decisions that were denied or deferred. This figure represents an increase of 19 (17.9 percent) over the period of June 1997 through November 1997.
To ensure it is promptly processing drug TARs, we recommend the department closely monitor the scheduling of data-entry staff. A lack of contract data-entry staff impedes the department's ability to process drug TARs within the required time frame. Additionally, the contractor has up to five days to enter data, which exceeds the department's own timeline of one working day and may contribute to the backlog of TARs.
Therefore, when its current contract ends, we recommend the department negotiate time provisions consistent with its own policy.