PTCE PTCE Billing and Reimbursement 1 — Questions and Answers
Question 1: What does DAW stand for in pharmacy billing?
- Dispense As Written (Correct answer)
- Drug Authorization Waiver
- Dispensing Approval Workflow
- Drug Availability Warning
Correct answer: Dispense As Written
DAW (Dispense As Written) is a code indicating the prescriber requires the brand-name drug rather than a generic.
Question 2: What is the primary purpose of a prior authorization (PA) in pharmacy billing?
- To expedite dispensing
- To obtain insurance approval before dispensing a specific medication (Correct answer)
- To verify the patient's identity
- To confirm the pharmacy's license
Correct answer: To obtain insurance approval before dispensing a specific medication
A prior authorization requires the prescriber to obtain insurance approval before a non-formulary or specialty drug will be covered.
Question 3: What is the BIN number on a pharmacy insurance card used for?
- To identify the patient's date of birth
- To route prescription claims to the correct insurance processor (Correct answer)
- To verify the pharmacist's license
- To look up drug pricing
Correct answer: To route prescription claims to the correct insurance processor
The BIN (Bank Identification Number) is a 6-digit number used to route electronic prescription claims to the correct insurance processor.
Question 4: What does a pharmacy formulary contain?
- A list of licensed pharmacies
- A schedule of pharmacist salaries
- A list of drugs covered by an insurance plan (Correct answer)
- A record of patient prescriptions
Correct answer: A list of drugs covered by an insurance plan
A formulary is an insurance plan's approved list of covered medications, often organized into tiers that affect the patient's copay.
Question 5: What is coordination of benefits (COB) in pharmacy billing?
- Combining two prescriptions into one fill
- A process that determines payment order when a patient has two insurance plans (Correct answer)
- Transferring a prescription between pharmacies
- Adjusting the days supply on a claim
Correct answer: A process that determines payment order when a patient has two insurance plans
COB ensures that when a patient has primary and secondary insurance, both are billed correctly so total payment does not exceed the drug cost.
Question 6: What does the PCN number on an insurance card identify?
- Patient Control Number for identification
- Processor Control Number used to route claims (Correct answer)
- Pharmacy Chain Number for the dispensing location
- Prescription Code Number for the drug
Correct answer: Processor Control Number used to route claims
The PCN (Processor Control Number) works alongside the BIN to further direct claims to the correct benefit plan within an insurance processor.
PTCE PTCE Billing and Reimbursement 1
What does DAW stand for in pharmacy billing?