Inventory Management & Billing Flashcards

What does 'PAR level' stand for in pharmacy inventory management?

Answer: Periodic Automatic Replenishment

PAR (Periodic Automatic Replenishment) level is the minimum quantity of a drug that must be on hand before reordering is triggered.

Which drug recall class indicates the most serious risk, including situations that can cause serious adverse health consequences or death?

Answer: Class I

Class I recall is the most serious, involving products that could cause serious health consequences or death if used.

What is the primary purpose of an automatic dispensing cabinet (ADC) in a hospital setting?

Answer: To provide controlled access and tracking of medications at the point of care

ADCs like Pyxis or Omnicell provide nurses with secure, controlled access to medications while electronically tracking every transaction.

What does 'NDC' stand for in pharmacy?

Answer: National Drug Code

The National Drug Code (NDC) is a unique 10- or 11-digit identifier assigned to every medication product sold in the US.

Which inventory valuation method assigns the cost of the most recently purchased items to cost of goods sold?

Answer: LIFO (Last In, First Out)

LIFO (Last In, First Out) uses the most recent purchase price to value inventory sold, which is the opposite of FIFO.

A pharmacy receives a drug recall notice. Which action should be taken FIRST?

Answer: Identify and quarantine the recalled lot numbers from dispensing stock

The first step is to identify affected lot numbers and physically quarantine them so no further dispensing occurs while the recall is processed.

What is a 'formulary' in the context of managed care and pharmacy?

Answer: A list of preferred medications covered by an insurance plan

A formulary is a list of prescription drugs approved for coverage by an insurance plan, often organized into tiers based on cost.