Press release

May 17, 2018

FWA Case #1: The case of the phantom pharmacy

A bogus entry in an EOB. Locked pharmacy doors during business hours. Prime’s team pulls the thread and unravels the case. 


The lights are on and drugs are on the shelves, but nobody’s home. Is this pharmacy legit? That was the question in this fraud, waste and abuse (FWA) case study. 

Prime’s team received a call from an alert member on the FWA hotline in December 2016. The member noticed a paid claim on her explanation of benefits (EOB) for a prescription drug she did not receive. According to her EOB, Prime had paid a pharmacy in Texas for a drug that she did not get and had not been prescribed. The member had paid no copay. 

How many of you review your EOB that closely? 

This member did! And Prime’s team investigated. 

Prime’s team determined that Prime should conduct an on-site visit to the pharmacy, an independent retail pharmacy in Texas. 

Prime’s on-site auditor arrived at the pharmacy unannounced in January 2017 during normal business hours. The pharmacy was closed. There was a sign on the door stating the pharmacy was closed, but regular business hours were posted on the door. Based on the pharmacy’s posted hours, the pharmacy should have been open. 

Calls to the phone number listed on the door received a busy signal. Visits to the website were blocked. Prime’s auditor could see empty wholesaler medication totes lying in the grass outside of the pharmacy. 

Inside the building the pharmacy had over-the-counter and prescription medication inventory on the shelves. Framed staff licenses were posted on the wall inside of the pharmacy and at least one computer terminal could be seen. It appeared to be unplugged. 

Prime flagged the pharmacy as a potentially fraudulent pharmacy operation and took actions to prevent future FWA. Member claims for the previous six months were reversed in the amount of $92,000. This amount reflects direct plan paid cost avoidance. The pharmacy was placed into a category called a No Contract Network (no valid contract). This prevents the further processing of any claims from this pharmacy until/unless issues are resolved. 

Prime’s fraud, waste and abuse program aggressively identifies and roots out costly behavior across the entire prescribing process, analyzing prescriber, pharmacy and member data and behaviors. The program includes all in-network pharmacy types including retail, mail and specialty. 


About Prime Therapeutics

Prime Therapeutics LLC (Prime) helps people get the medicine they need to feel better and live well. Prime manages pharmacy benefits for health plans, employers, and government programs including Medicare and Medicaid. The company processes claims and offers clinical services for people with complex medical conditions. Prime serves more than 27 million people. It is collectively owned by 18 Blue Cross and Blue Shield Plans, subsidiaries or affiliates of those plans.

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