Mastering Pharmacy Medical Billing + Claims Submission

Mastering Pharmacy Medical Billing + Claims Submission




Samm Anderegg

Max Anderegg




Demystifying Pharmacy Medical Claims Submission – The Old Way

Pharmacy billing encompasses submitting claims to insurance payers for reimbursement for pharmacy services. These services range from dispensing medications to providing medication therapy management (MTM) and other clinical interventions

Pharmacy claims are typically submitted as D.0 billing – This standard is set by the National Council for Prescription Drug Programs (NCPDP) to bill for (mostly) prescription medications that are dispensed through a PBM.

Traditionally, pharmacy billing has been handled by PBMs, but the increasing focus on pharmacist-provided clinical services has led to the adoption of medical claims submission.

Understanding Pharmacy Medical Claims Submission – The New Way

Medical claims submission involves utilizing Current Procedural Terminology (CPT) codes and Healthcare Common Procedure Coding System (HCPCS) codes to represent the services provided by pharmacists accurately. These codes are how physicians, nurse practitioners, and other providers bill for services. They are standardized and reviewed annually by the American Medical Association. Similarly, the codes are essential for communicating the value of pharmacist-provided care to insurance payers and securing fair and competitive reimbursements.

Understanding Pharmacy Medical Claims Submission –   The New Way

Feature Pharmacy d.0 Medical Claim Submission
Payer Pharmacy Benefit Manager
Health Plan
Services Covered
Prescription Services, Some Vaccines, Basic MTM services
Clinical Services – Vaccines, Tests, Comprehensive Medication Reviews
Reimbursement Rates
Billing Codes
National Drug Codes
Current Procedural Terminology (CPT) codes and Healthcare Common Procedure Coding System (HCPCS) codes
Submission Method
Electronic or Paper
Reimbursement Time
< 1 month
> 1 month
DIR fees


Payer Enrollment

Pharmacies must establish medical contracts with payers, such as insurance companies and government programs (Medicaid and Medicare), to be reimbursed for their services. The contract is called a “provider agreement”. The process to secure the agreement involves negotiating payment rates and agreeing to the terms and conditions of the contract.

Before seeking a provider agreement, utilizing resources like AHIP (America’s Health Insurance Plans), which offers a comprehensive guide outlining payer market share in each state, is advisable. This valuable information can help you identify which payer networks you should prioritize joining. Additionally, consider the patient populations you serve most frequently in your community, particularly for employer-sponsored or local health plans. Directly contact these plans to inquire about enrollment procedures and eligibility requirements.

Another essential factor is whether the plan allows pharmacies to join their medical network. In many states, such as California, Texas, and Washington, laws have been enacted to mandate the enrollment of pharmacists into health plans. If you encounter challenges joining a network, consider approaching physicians in your area or MSO groups to explore potential strategic partnerships.

Credentialing Process

Pharmacists and other pharmacy staff who will be providing services that are reimbursable through medical claims must be credentialed with the appropriate payers. This process involves verifying their credentials and ensuring they meet the payers’ requirements.

The process for completing the credentialing requirements and the turnaround for being credentialed can be extensive. It usually takes 2-4 months to be credentialed by a payer. The specific requirements may vary depending on the payer and the pharmacist’s specialty, but they typically include the following:

  • Education and Licensure: Pharmacists must have a Doctor of Pharmacy (PharmD) degree or equivalent from an accredited institution. They must also be licensed to practice pharmacy in the state where they apply for credentialing.
  • Experience: Payers may require pharmacists to have a certain amount of experience in a particular practice setting or with a specific patient population before they will grant credentialing.
  • Training and Certifications: Pharmacists may be required to complete additional training or certifications in medication therapy management (MTM), immunizations, or diabetes management.
  • Malpractice Insurance: Pharmacists must carry malpractice insurance to protect themselves from liability claims arising from their practice.
  • Background Check: Payers may conduct a background check on pharmacists to verify their identity, education, and licensure and to identify any criminal or disciplinary records.
  • Professional References: Pharmacists may be asked to provide professional references from colleagues or supervisors who can attest to their qualifications and performance.
  • Annual Re-credentialing: Pharmacists must typically re-credential with payers every one to four years (depending on the payer) to maintain their in-network status. This may involve updating their information and providing documentation of any new certifications or training they have completed.

A tool that streamlines the credentialing process is CAQH. CAQH, which stands for the Council for Affordable Quality Healthcare, is a non-profit organization that aims to improve the efficiency and effectiveness of the healthcare administrative system by standardizing processes.

CAQH Proview is an online portal allowing providers to create and maintain a comprehensive profile of their professional and practice information. This profile can then be shared with multiple payers, eliminating the need to submit the same information repeatedly.
CAQH can be a valuable resource for healthcare providers looking to improve their credentialing. It can take some time to complete the credentialing, so it’s always recommended to begin this process as soon as possible.

Technology Partners

Pharmacies should select technology partners to provide the software and systems to manage medical claims submissions. This includes software for billing, coding, and claims tracking. Traditional EHR and EMR systems used for physicians may not meet the pharmacy’s needs due to the pharmacy’s unique workflows or billing needs.

DocStation offers a pharmacy billing software that enables pharmacists to efficiently run their businesses with fewer hours spent submitting, tracking and adjudicating claims. Pharmacy operations are made easier with DocStation’s pharmacy billing support, which provides digital solutions for every clinical business function, including:

  • Automated Billing
  • Claim submission
  • Claim tracking
  • Revenue cycle management
  • Workflow automation
  • Billing and CPT code selection
  • Billing template development


Pharmacists and pharmacy technicians should be trained to accurately code and submit medical claims. This training should cover the different types of claims, the appropriate codes for each service type, and the submission process.

Because pharmacy medical claims submissions usually relate to a limited set of billing codes, it may be worth exploring the establishment of a customized in-house training program tailored to your pharmacy’s specific needs and requirements.

If you cannot develop an in-house training program, websites like AAPC (free and paid courses), and Udemy (free courses), might be an excellent place to educate your pharmacy staff.


Identify reimbursable services

Pharmacies need to identify the services they provide that are reimbursable through medical claims. This includes services such as medication therapy management (MTM), immunizations, acute and chronic care services (i.e., test to treat, smoking cessation, wellness visits, etc.,), and comprehensive medication reviews

Evaluate service demand

Pharmacies should evaluate the demand for reimbursable services in their community. This can help them determine which services to focus on and which may not be worth pursuing.

Align services with payer requirements

Pharmacies must ensure that their services align with the payer reimbursement requirements. This includes understanding the payers’ coverage policies and coding requirements.


Utilize appropriate CPT or HCPCS codes

Pharmacies must use the appropriate CPT or HCPCS codes for their services. Payers use these codes to identify and classify medical services.

Submit claims accurately and electronically

Pharmacies need to submit claims accurately and electronically to payers. This includes providing the required information and ensuring the claims are formatted correctly.

Track claims status and reimbursement

Pharmacies need to track the status of their claims and follow up with payers if necessary. They should also keep track of reimbursement rates and ensure they are being reimbursed correctly.

Stay informed of regulatory changes

Pharmacies must stay informed of any changes to medical claims regulations. This includes changes to coding requirements and payer policies.


Service CPT Code ICD-10 Code Range Description
90460 – 90474
Immunization administration for vaccines/toxoids. Community pharmacists may use these codes when providing vaccinations to patients.
Comprehensive Medication Reviews
Various E/M codes
Comprehensive Medication Reviews Various E/M codes Various Pharmacists may use Evaluation and Management (E/M) codes, such as 99213 or 99214, for comprehensive medication reviews. Relevant ICD-10 codes should align with the patient’s condition.
Medication Therapy Management
99605, 99606
No specific ICD-10 code is required
CPT codes 99605 and 99606 are used for medication therapy management services provided by pharmacists. These codes reflect face-to-face patient encounters.
Acute Care Visits and Services
99202, 99212
Pharmacists engaging in acute care visits, test to treat, vaccines, smoking cessation, Pep, and Prep services may use E/M codes such as 99202 and 99212. These codes reflect comprehensive assessments and management during patient encounters.
Point-of-Care Testing
While not strictly CPT codes, pharmacists may use specific codes or identifiers for point-of-care testing services, depending on the type of test performed.
Health Screenings
Depending on the specific health screening service offered, pharmacists may use relevant CPT codes for billing purposes. Common codes vary based on the screening type.

Understanding the claims submission and revenue cycle management process

The pharmacy billing process follows a step-by-step sequence:

  • Patient Encounter: The pharmacist meets with the patient to verify insurance coverage (and eligibility), assess their needs, and treat them appropriately for the encounter while ensuring appropriate documentation.
  • Coding and Claim Preparation: The pharmacist assigns appropriate CPT or HCPCS codes and generates a claim form. Documentation is typically necessary for audit and purposes.
  • Claim Submission: The claim is processed electronically to the insurance payer.
  • Reimbursement Processing: The insurance payer reviews the claim and determines the reimbursement amount.
  • Payment Reconciliation: The pharmacy receives payment from the insurance payer and reconciles it with the submitted claim.

Addressing Billing Challenges

Pharmacists often encounter challenges during the billing process, such as:

  • Coding Errors: Incorrect coding can lead to denied or delayed reimbursement.
  • Claim Submission Errors: Improper claim submission can result in rejected claims.
  • Payer Denial: Insurance payers may deny claims for various reasons, such as insufficient documentation or lack of coverage for the service.

Strategies for Success

To overcome billing challenges and maximize revenue, pharmacists can adopt effective strategies:

  • Coding Accuracy: Employ coding references and stay updated on coding guidelines to ensure accuracy.
  • Timely Claim Submission: Submit claims promptly to minimize the risk of reimbursement delays.
  • Thorough Documentation: Maintain detailed patient records and prescription documentation to support claims.
  • Appeal Denied Claims: Appeal denied claims with appropriate documentation and justification.


By mastering medical claims and revenue cycle management, you can expand pharmacy revenue on the services you perform.

As pharmacists expand their clinical roles and provide comprehensive patient care, navigating the complexities of pharmacy billing becomes increasingly important. This guide has equipped pharmacists with the knowledge and strategies to effectively manage pharmacy billing.