HB394 Summary - The Pharmacy Audit Integrity Act

• Establishes minimum and uniform standards for pharmacy audits conducted by managed care companies, health benefit plans, pharmacy benefit managers, third-party payors, and state health programs.

• Requires auditing entities to provide 2 weeks written notice before on-site audits, deliver preliminary reports within 90 days, allow pharmacies 30 days to respond, and issue final reports within 180 days.

• Prohibits use of extrapolation accounting methods to calculate recoupments or penalties; recoupments must be based on actual overpayments or underpayments of actual claims only.

• Establishes written appeals process for pharmacies to challenge unfavorable preliminary audit reports, with option for mediation by certified mediator if issues remain unresolved.

• Limits audit scope to claims submitted within 2 years, restricts audits during first 5 days of each month, requires audits be conducted by or with consultation of licensed pharmacist when involving clinical judgment, and exempts fraud/willful misrepresentation investigations from the act's requirements.