Case Study: Chargeback Reserve Estimates and Methodology
• Reserve True-up methodology
• Developing point of sale accrual rates for products
• Various operational metrics used by accounting and FP&A departments to analyze and monitor reserve balances
• Using external channel data in our true up and monthly metrics analysis
• Picking an external inventory channel vendor and monitoring and maintaining the data received from the wholesalers; setting up wholesaler 852/867 fees
• Leading internal and external audit teams through the wing to wing chargeback process
Follow-up Chargeback Panel Discussion
• What are key complexities to the chargeback process and how are these managed?
• What are considerations for contractual renewal, reporting requirements and discounts between commercial and governmental customers?
• Process considerations for validation activities
• David A. Mericsko, Assistant Commercial Controller, GE Healthcare Life Sciences
• Marijo G. Bustos, Manager, Chargebacks, Fresenius Kabi USA, LLC
• Jeff Miller, Senior Manager - Financial Accounting, Impax Laboratories Inc.
• Rosemary Schaab, Controller/Director, Chargebacks Administration, AmerisourceBergen
• Jon Brier, Product Manager, Revenue Manager, Revitas
1. How feasible is collaboration between managed markets, commercial, government programs and Finance?
Constant dialogue between departments is a necessity. From my an accounting point of view, we here at GE Life Sciences promote this through a variety of measures including:
• Monthly GTN meetings with commercial, finance and accounting department leaders to discuss point of sale rates and operational results/ metrics;
• Monthly GTN accrual meetings with commercial and government teams;
• Commercial contract “workflows” that ensure the impact of new/ revised contracts are reviewed/approved by each of these groups;
• Daily adhoc communications via email, phone etc. to ensure new issues are communicated to each group.
2. Key questions to ask before investing and building an automated GTN system?
Key questions would include:
• Is this a global or US IT solution?
• How is data integrity maintained? How can data be traced to the GL/ be audited?
• How will the solution interact with our current systems?
• Who are the report users? Do the reports meet their needs?
3. How to accrue and forecast patient/payer related items? What critical/essential information is required and what aspects you can’t afford to overlook.
Patient/ payer accruals is not really applicable for our distribution chain. Our products are diagnostic agents used by hospitals for various imaging scans.
To hear more from David, please join us at the Gross-To-Net Accounting Forum, June 17-18 in Philadelphia, PA.
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