Medicare General Information and Updates

CMS Announces Accreditation Deadlines for DMEPOS Suppliers…
Section 302 of the Medicare Modernization Act (the Act) required the Secretary to establish and implement quality standards for suppliers of Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS).  All suppliers that furnish these covered items must comply with the quality standards in order to receive Medicare Part B payments and to retain a supplier billing number. Covered items include DME, medical supplies, home dialysis supplies and equipment, therapeutic shoes, parenteral and enteral nutrient, equipment and supplies, transfusion medicine and prosthetic devices, prosthetics, and orthotics.  The deadlines for accreditation are as follows:

•        Existing DMEPOS suppliers enrolled in the Medicare program are required to obtain and submit an approved accreditation to the National Supplier Clearinghouse (NSC) by September 30, 2009.

•        New DMEPOS suppliers who are enrolled for the first time before March 1, 2008 must obtain and submit an approved accreditation to the NSC by January 1, 2009.

•        New DMEPOS suppliers submitting an enrollment application to the NSC on or after March 1, 2008 must be accredited prior to submitting the application.

Please note that the NSC shall revoke a DMEPOS supplier's billing privileges if the supplier fails to obtain and submit supporting documentation that they are accredited.  For more information, please visit our Medicare Provider-Supplier Enrollment web page.

DMEPOS Accreditation and Its Impact on Retail Pharmacy
Latrobe, PA – November 6, 2007 – The Medicare Modernization Act of 2003 requires the Centers for Medicare and Medicaid Services (CMS) to set-up Accreditation and Competitive bidding processes for the suppliers of Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS).  CMS is to phase in these requirements over the next two years.  Specifically, the Act Requires CMS to use a Competitive Acquisition Process (CAP) for setting DMEPOS payment amounts and to approve Accreditation Organizations (AO’s) to apply quality standards for all DMEPOS providers.

To date, there is still a nationwide misconception that pharmacies do not have to be accredited if they chose not to become involved in the competitive bidding process.  This is not the case.  In the near future, ALL DMEPOS SUPPLIERS, including pharmacies, MUST become accredited if they intend to continue participating in the Medicare Part B program, whether or not they choose to participate in the competitive bidding process.  This misconception and subsequent delay in pursuing accreditation could cost those pharmacies their Medicare Part B billing number and thus their right to bill Medicare and receive future payments for DMEPOS products, including Diabetic Supplies. 

The source of this confusion is that Diabetic Supplies are exempt from the first round of competitive bidding in the initial ten bidding areas.  Most pharmacy owners think that because Diabetic Supplies are exempt from competitive bidding that they do not have to do anything to continue to provide these items.  Wrong!  Although exempt from competitive bidding, accreditation will be required for pharmacies selling these items to Medicare beneficiaries.  This requirement applies to any exempt item.  Do not confuse accreditation and competitive bidding.  Although interrelated, they are two entirely different requirements and processes.

Accreditation does NOT impact suppliers of Part B drugs, and pharmacists providing influenza and pneumonia vaccinations.  These services may still be provided without seeking accreditation.

Under competitive bidding, DMEPOS suppliers will submit bids to the Centers for Medicare and Medicaid Services (CMS) to provide items and services to Medicare Beneficiaries for reduced fee schedule rates.  In exchange, CMS will select a limited number of suppliers in a given area and require beneficiaries to use one of them.  CMS designated these areas, called Competitive Bidding Areas (CBA’s), across the United States.  Ten areas are bidding in 2007, 70 additional in 2008 and the remainder in 2009.

Under the bidding process, CMS will select just the number of winning bidders necessary to provide the volume of products it expects beneficiaries to need within a product category up for bid in a given CBA.  After it has selected the number of bidder’s necessary, the mean bid price for each item within a product category will become the new price paid for that item. 

Not all parts of the country fall into a competitive bidding area and these areas are designated as rural.  Suppliers located in a rural area will not have to worry about competitive bidding as long as none of their customers live within a CBA.  It is important to point out that if your pharmacy is in a rural area, you must still competitively bid in order to provide bid items to customers who reside in a CBA.  Conversely, if your pharmacy is located within a CBA you can still service customers living in rural (non-CBA) areas without competitively bidding.  The bottom line, CMS cares if the beneficiary being serviced lives within a CBA and not the location of the supplier.  The only caveat here is that CMS reserves the right to impose winning bid prices on products sold in rural areas after January 1, 2009.

The Quality Standards come into play to help ensure that both bidding and non-bidding DMEPOS suppliers do not skimp on the care they provide Beneficiaries, Congress mandated that CMS create quality standards and apply them to all suppliers.  CMS will ensure that suppliers are meeting the quality standards through requiring accreditation by one of the CMS designated Accreditation Organizations (AO).

The quality standards are broken down into two broad categories, Business Services and General Product-Specific Services Standards.  There are seven sub-sections under Business Services, which are Administration, Financial Management, Human Resource Management, Consumer Services, Performance Management, Product Safety and Information Management.  General Product Specific Services has four sub-sections, Preparation, Delivery and Set-Up, Training/Instruction to Beneficiary and Caregiver and Follow-up. 

Policies, procedures, forms and other documents will need to be prepared, put in place and followed to meet the requirements of each sub-section.  Each of these is quite extensive.  Let it suffice to say for now that it will take dozens of hours to write the documents necessary for each of these.  A better choice may be to acquire these documents from an independent source, which will certainly save you a lot of time and expense in preparing for accreditation.  When choosing an outside source, the user must ensure that they have experience with retail pharmacy.  Most products to assist with accreditation, even those provided by the Accreditation Organizations, were written for DMEPOS suppliers, not retail pharmacies.  These may not do much good since they will require extensive reworking.

One sub-section we shall touch on briefly is Information Management.  The standard states “The supplier shall maintain accurate, pertinent, accessible, confidential and secure beneficiary records in accordance with the privacy and security standards of the Health Insurance Portability and Accountability Act (HIPAA) and other applicable state standards.”  Yes, HIPAA is back in the limelight and more important than ever.  If a pharmacy, which may be one of the thousands that passed on implementing a full HIPAA compliance program, complete with Disaster Recovery Plan, then, they will have a lot of additional work ahead.  Over 100 policies, procedures and forms will need to be prepared just to meet the HIPAA requirements under Information Management.

CMS will enforce this accreditation requirement by discontinuing Medicare payment to suppliers who are not accredited.  In addition, once accreditation is mandated for an area, suppliers applying to renew their Medicare billing number will have to be accredited prior to doing so.

As stated earlier, CMS has selected ten Accreditation Organizations as sources when seeking accreditation.  When a pharmacy chooses an Accreditation Organization, they should consider: the cost associated with accreditation, their interpretation of the quality standards, what is their accreditation process and how long is accreditation good for before re-accreditation is required.  The most important of these is their interpretation of the CMS quality standards.  A pharmacy should get a copy of an AO’s standards prior to selecting them.  The quality standard interpretations vary widely from AO to AO and can significantly influence the amount of preparation time involved.  For most pharmacies, simple is better since they will be providing mostly “light” DMEPOS such as walkers, diabetic supplies, etc. as opposed to, say, hospital beds and oxygen.  In addition, the cost can vary from as little $2000 to over $5000 depending on the AO and accreditation is good for two or three years.  Spending a little time researching the requirements of the AO’s up front will save a pharmacy many unnecessary headaches later.

Furthermore, a pharmacy should expect the backlog of the Accreditation Organization’s survey process to be quite extensive as more and more areas come on line.  The longer a pharmacy delays in preparing themselves for accreditation increases likelihood of failing the survey and not be awarded accreditation.

The prevailing wisdom stresses that it is important for all pharmacies to pursue accreditation since it is expected that many private and other government funded insurance programs will follow Medicare’s lead in requiring accreditation, and in fact, several already have done so.  Pharmacy owners still have adequate time to complete the accreditation process and are strongly encouraged to begin no later than fall of 2007.  The accreditation deadline for all suppliers will be sometime in 2009.  CMS is pushing for early 2009 since it has detected widespread fraud in the Medicare Part B Program and accreditation is the way to eliminate a major portion of this fraud.

To summarize accreditation, suppliers must be accredited in order to provide DMEPOS in which Medicare Part B makes payments, competitively bid and receive or renew a Medicare Identification Number or Supplier/Billing Number.  If any pharmacy falls into one of these categories, it is time to start the accreditation process.  Wasting time could be wasting money—and risk the possibility of losing a pharmacy’s major source of income, the diabetic customer.

CMS has started the accreditation time clock ticking.  It is only a matter of time until the clock runs out for those pharmacies that do not begin seeking accreditation soon.  There are over 150,000 current DMEPOS suppliers, 52,000 of which are pharmacies, who need to seek accreditation and only ten CMS approved Accreditation Organizations. 

The author, Harry A. Lattanzio, R.Ph, is president of PRS Pharmacy Services and owns both retail and LTC pharmacies.  He has given numerous seminars throughout the country on preparing a pharmacy to pass the DMEPOS Accreditation survey.  For more information on how PRS is helping pharmacies beat the clock, visit our website at www.prsrx.com.

• Pneumococcal pneumonia vaccine;
• Influenza virus vaccine; 
• Hepatitis B vaccine for individuals at high or intermediate risk; and 
• Other vaccines (e.g. tetanus toxoid) when directly related to the treatment of an injury or direct exposure to a disease or condition.

If a vaccine is covered under Part B, it will continue to be covered under Part B regardless of the changes to Part D vaccine administration reimbursement in 2007 and 2008 discussed later in this article.

Coverage of Vaccines under the Part D Program
The Part D program will generally cover those vaccines not available for reimbursement under Medicare Parts A or B when administration is reasonable and necessary for the prevention of illness.

Part D plans identify covered drugs and vaccines through the use of formularies. However, a new preventative vaccine may not be specifically listed on the Part D plan’s formulary. This does not mean the vaccine is not available for reimbursement. The provider can contact the Part D plan about coverage and any supporting information that might be necessary to facilitate vaccine coverage for the beneficiary (Part D plan contact information is located at the end of this article).

To facilitate greater access to Part D vaccines, CMS has directed that starting in 2008 all Part D plans’ formularies must contain all commercially available vaccines (unless excluded due to available reimbursement under Part B, e.g., influenza or pneumococcal vaccines as discussed above).

Example of identifying vaccines covered under Part B or Part D: Hepatitis B vaccine provides a useful illustration of how a provider could approach vaccine reimbursement under Medicare Part B or D.

Part B covers Hepatitis B vaccine for intermediate and high risk patients. A beneficiary meeting the intermediate or high risk coverage criteria could obtain the Hepatitis B vaccination series from their physician and the physician would submit a claim to the Medicare Part B contractor. For the beneficiary who did not satisfy the appropriate Part B risk criteria, he or she could still obtain the Hepatitis B vaccine from their physician; however, any potential reimbursement would be available from the beneficiary’s Part D plan instead of the Part B contractor. Facilitation of Part D vaccine reimbursement is discussed later in this article.

Coverage of Vaccine Administration Under the Part B Program
The Tax Relief and Health Care Act (TRHCA), effective January 1, 2007, provided for reimbursement of vaccine administration associated with Part D vaccines. Pharmacies and physicians can use a newly instituted G code (G0377) to bill Part D vaccine administration to local Medicare Part B contractors. Normal Part B beneficiary deductible and coinsurance requirements apply and payment for the actual Part D covered vaccine is the responsibility of the beneficiary’s Part D plan. In other words, in 2007 Medicare Part B will not pay for the Part D vaccine (i.e. low risk Hepatitis B vaccine), just the Part D vaccine administration. Reimbursement for this code is only effective for calendar year 2007.

For additional information on Part B reimbursement of Part D vaccine administration in 2007 see the MLN Matters articles MM5443 and MM5459, published in December, 2006:

• MM5443 is available at http://www.cms.hhs.gov/MLNMattersArticles/downloads/MM5443.pdf and
• MM5459 is available at http://www.cms.hhs.gov/MLNMattersArticles/downloads/MM5459.pdf.

Coverage of Vaccine Administration Under the Part D Program

TRHCA modified the definition of a Part D drug to include "for [Part D] vaccines administered on or after January 1, 2008
In general, CMS believes that Part D vaccines, including the associated administration costs, should be billed on one claim for both in- and out-of-network situations. For example, if an in-network pharmacy dispenses and administers the vaccine in accordance with State law, the pharmacy would process a single claim to the Part D sponsor and collect from the enrollee any applicable cost-sharing on the vaccine and its administration. Alternatively, if a vaccine is administered out-of-network in a physician’s office, the physician would administer the vaccine and then bill the beneficiary for the entire charge, including both components. The beneficiary would, in turn, submit a paper claim to the Part D sponsor for reimbursement of plan allowable costs for both the vaccine cost and the administration fee.

Consequently, beginning on January 1, 2008, the Part D program will cover vaccine administration costs associated with Part D vaccines. Thus, the coverage available in 2007 under Part B will cease and reimbursement will be available solely under Part D. CMS interprets this new statutory requirement to mean that the Part D vaccine administration costs are a component of the negotiated price for a Part D-covered vaccine. In other words, the negotiated price for a Part D vaccine will be comprised of the vaccine ingredient cost, a dispensing fee (if applicable), sales tax (if applicable) and a vaccine administration fee. This interpretation recognizes the intrinsic linkage that exists between the vaccine and its corresponding administration, since a beneficiary would never purchase a vaccine without the expectation that it would be administered.

Cost-Sharing Considerations

In general, a Part D plan should not charge separate copays for the vaccine and its administration since CMS views the vaccine and its administration as intrinsically linked. If a Part D plan charges coinsurance, it should be applied relative to the entire price of both components. Low income subsidy eligible individuals with copays set by statue (see section 1860D-14(a)(1)(D) of the Social Security Act) will always pay only one copay for a vaccine and all related charges. Thus, for example, a low income subsidy eligible individual entitled to $1.05/$3.10 copays in 2008 would pay only $3.10 for both the vaccine and its administration (and any applicable dispensing fee) even if the components are billed separately.

Elements of Vaccine Administration

CMS expects that Part D plans will take into consideration the elements reflected in existing 2007 Part B vaccine administration fees when establishing their own vaccine administration fees for 2008. Part D plans will have the discretion to implement either a single vaccine administration fee for all vaccines or multiple administration fees based on type of vaccine, variance in provider type, and product administration complexity. Providers should contact Part D plans regarding specific vaccine administration fees for 2008. (Part D plan contact information is listed at the end of this article.)

Part D Reimbursement for Vaccines in Provider Settings

As stated earlier, Part D plans are required to provide access to vaccines not covered under Parts A or B. During initial Part D rulemaking, CMS described use of standard out-of-network requirements to ensure adequate access to the small number of vaccines covered under Part D that are administered in a physician’s office. CMS’ approach was based on the fact that most vaccines of interest for the Medicare Population (influenza, pneumococcal, and hepatitis B for intermediate

As newer vaccines have entered the market with indications for use in the Medicare population, Part D vaccine in-network access has become more imperative. Requiring the beneficiary to pay the physician’s full charge for a vaccine out of pocket first and be reimbursed by the plan later is not an optimal solution, and CMS has urged Part D plans to implement cost-effective, real-time billing options at the time of administration. CMS issued guidance to Part D plans to investigate alternative approaches to improve access to vaccines under the Drug Benefit without requiring up-front beneficiary payment and to ensure adequate access to Part D vaccines.

CMS outlined the following options to Part D plans for their consideration. Physicians should expect to see various models develop and should be aware of both their potential existence and use by Medicare beneficiaries.

Options to Ensure Adequate Access under Part D to Covered Vaccines

In-Network Distribution Approaches

• In-Network Access to Retail Pharmacies: Enrollees could obtain a prescription from the physician and bring it to their local network retail pharmacy for filling. In some states, it will already be possible for the vaccine to be administered by the pharmacist. Forty-six states currently allow pharmacists to provide some type of vaccinations. When it is safe to dispense and administer these vaccines in the pharmacy, plans will be exploring utilization of their network pharmacists as a provider of adult Medicare Part D vaccines.
• In-Network Pharmacy Distribution: A Part D plan’s local pharmacy or specialty pharmacy could provide vaccines directly to physician offices. Under this scenario, the physician could call in a prescription, or the beneficiary could deliver or mail a prescription for the vaccine to the pharmacy. The pharmacy would fill the prescription for the vaccine, ship or deliver to the physician’s office, and bill the Part D plan for the vaccine. (This model resembles the competitive acquisition program (CAP) for Medicare Part B drugs in that the drug is shipped to the physician, but the physician never purchases or gets reimbursed for the drug.)

Out-of-Network Approaches: Facilitated Out-of-Network Access Approaches

Web-Assisted Out-of-Network Billing: Under this approach, physicians would electronically submit beneficiary out-of-network claims to Part D plans for vaccines dispensed and administered in the physician’s office through a web-assisted portal (vendor). This approach would allow the beneficiary to pay out of pocket only the appropriate deductible and copay or cost sharing directly to the physician, thus avoiding any up-front payment and repayment for the full cost of the vaccine. The physician would assume responsibility for submitting the claim on behalf of the beneficiary and would agree to accept Part D plan payment as payment in full.

Model Vaccine Notice for Physicians (Paper Claim Enhancement): Part D plans would provide all enrollees with a vaccine-specific notice that the enrollees could bring to their physicians. This notice would provide information necessary for a physician to contact the enrollee’s Part D plan to receive authorization of coverage for a particular vaccine, reimbursement rates, enrollee cost-sharing to be collected by the physician, and instructions on how to submit the out-of-network claim on the beneficiary’s behalf.

It is important to emphasize for either out-of-network approach, the physician does not become a network provider, but is assisting the beneficiary in the submission of his or her out-of-network claim.

CMS is working with Part D Sponsors to facilitate these various approaches. CMS encourages additional exploration of other possible means to coordinate the billing of vaccines in the real-time environment of the Part D benefit. CMS expects significant development in this area over the next year.

Frequently Asked Questions

If I need to immunize a beneficiary with a Part D vaccine, what do I need to do?

The beneficiary or physician can call the Part D Plan to discuss what the cost sharing and allowable charges would be for the vaccine as part of the Part D plan’s out-of-network access or inquire as to the availability of any alternative vaccine access options. Plan contact information is available at the following website:

http://www.medicare.gov/MPDPF/Public/Include/DataSection/Questions/MPDPFIntro.asp and then follow the directions on the section "Learn More About Plans in Your Area." You may also obtain plan contact information by calling 1-800-MEDICARE.

Do I need to provide Advanced Beneficiary Notice (ABN)?

No. Unlike traditional Medicare, Part D does not require ABNs.

Can I charge an administration fee?

Yes.

Is the Herpes zoster vaccine (Trade name Zostavax) covered under Medicare Part B or D?

Since the Herpes zoster vaccine is a preventive vaccine, it will be available for reimbursement under Part D. Beneficiaries and providers should contact the Part D plans for more information about costs and reimbursement for this and other preventive vaccines.

Additional Information

Before January 1, 2008: When a physician administers a Part D vaccine, the physician should use HCPCS code G0377 (linked to CPT code 90471) to bill the Part B local carrier for the administration fee of the vaccine.

January 1, 2008 and after: Part D vaccines, including the associated administration costs could be billed on one claim to the beneficiary or to the Part D plan, as stated in the preceding examples. MLN Matters article describes the Centers for Medicare & Medicaid Services (CMS) policy regarding provider reimbursement for Part D vaccines and vaccine administration in 2007 and 2008 under the Medicare Prescription Drug Benefit (Part D). In addition, the article outlines various approaches that Part D plans may implement to ensure beneficiaries have adequate access to Part D vaccines.

From S. Lawrence Kocot, Senior Advisor to the Administrator                                                                 
Centers for Medicare and Medicaid Services (CMS), Department of Health and Human Services

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Final rule on Medicaid AMP FUL is now on display…

CMS today put on display at the Federal Register a final rule that implements provisions of the Deficit Reduction Act of 2005 (DRA).  The DRA established a new federal upper limit (FUL) calculation, which is the maximum the federal government will pay to states in federal matching funds or federal financial participation (FFP) for multi-source drugs (generics) dispensed through state Medicaid programs.  The new FUL is calculated at 250% of the lowest average manufacturer price (AMP) in a generic drug class.  States may pay above or below the FUL for individual drug classes and still receive the full FFP as long as overall payments for multi-source drugs subject to a FUL are under the annual aggregate cap.  Please see the CMS Press Release for more information.

Goals of the DRA…more appropriate payment for generic drugs and transparency 

The DRA changes were prompted by a series of 2004 reports by both the Government Accountability Office (GAO) and the HHS Office of the Inspector General (OIG) showing that Medicaid payments to pharmacies for generic drugs were much higher than what pharmacies were actually paying for those drugs.  The GAO and OIG found that states were overpaying for drugs because they were using commerical drug pricing guides as the basis for setting state reimbursement levels.  The investigation of these drug price "compendia" documented that these prices were artificially inflated, especially for generic drugs. One goal of the DRA was to encourage states to pay pharmacies more appropriately for the estimated acquisition costs of generic drugs.  Prior to the DRA, actual drug prices were considered proprietary information and were used by CMS solely to calculate rebates; even CMS was prohibited by law from disclosing AMPs.  The DRA makes AMP available to the States to consider in determining their methods for setting reimbursement for drugs under the Medicaid Program.

CMS encourages states to pay pharmacies adequate dispensing fees…

While CMS is required by law to establish a FUL for multi-source drug payments, states retain the authority to set their own reimbursement levels and dispensing fees paid to pharmacists.  Recognizing that the new FULs could result in some reduction in drug ingredient payments to pharmacies, CMS is actively encouraging states to evaluate whether the fees they pay pharmacies are adequate to compensate them for their costs in dispensing these prescriptions.  The final rule provides for a new definition of “dispensing fees” which includes the pharmacy’s costs of dispensing the drug including overhead and profit.  In order to adjust dispensing fees, state Medicaid programs must submit a state plan amendment for federal approval. Dispensing fees receive a full federal match and are not limited by the new FULs. 

What does the final rule do?

CMS received more than 1600 comments to the proposed rule and has implemented some changes to reflect these comments.  Specifically, the final rule: 

• Revised the definition of retail pharmacy class of trade and wholesaler to better track the provisions of the DRA.  For example, it clarified that sales to entities such as Pharmacy Benefit Managers (PBMs) and pharmacies serving nursing homes and assisted living facilities are excluded from the determination of AMP;
• Added manufacturer coupons redeemed by an agent, pharmacy or entity acting on behalf of the manufacturer to the list of prices excluded from the determination of AMP;
• Added that manufacturer vouchers and manufacturer-sponsored drug discount card programs are excluded from the determination of AMP;
• Excludes outlier AMPs, meaning that the lowest AMP in a FUL group will be excluded if it is less than 40 percent of the next highest AMP (this is a change from 30% in the proposed rule);
• Added that sales to home infusion and specialty pharmacies are included in AMP (sales to mail order pharmacies remain included in AMP);
• Requires manufacturers to submit quarterly and monthly AMPs to CMS.  Monthly AMPs are calculated in the same manner as the quarterly AMP, except the period covered is one month.  This will allow for more frequent updates of the FUL.  Further, manufacturers must estimate the impact of lagged price concessions using a 12-month rolling average.

Importantly, to assure a smooth transition in the implementation of the final rule, the regulation addresses two provisions as final with a comment period: (1) a policy that eliminates from AMP calculations any drug in an FUL that is priced significantly lower than other drugs in that category, the so-called “outlier policy;” and, (2) definition of AMP.  This will allow CMS the benefit of further public comment as actual AMP numbers become available and the FULs are developed.  Stakeholders have 180 days from the publication date to submit public comments.  CMS will respond to the public comments at a later date.

When does the regulation become effective?

The regulation takes effect on October 1, 2007.  The first monthly AMP reporting period will be for October 1-31, 2007.  Please note that this is a change in schedule; FULs will not become effective for pharmacy payment until January 30, 2008, rather than December 30, 2007 as previously reported.  The new tentative schedule is forthcoming.

DMEPOS Competitive Bidding Program Deadline Extended…

The Centers for Medicare & Medicaid Services (CMS) announced Friday that it is extending the registration and bid submission deadlines for the first round of the Medicare DMEPOS Competitive Bidding Program.  All bids from suppliers are now due by July 20, 2007 at 9:00 p.m. EDT, for the first round of the competitive bidding program.  The original due date was July 13, 2007 at 9:00 p.m. EDT. 

Suppliers interested in bidding must first register and receive a user ID and password before they can access the internet-based bid submission system. The registration deadline for the user ID and password is now July 7, 2007.  Suppliers should register immediately to avoid a delay in being able to submit bids.  The original registration deadline was June 30, 2007.

Suppliers must be accredited or be pending accreditation to submit a bid and will need to be accredited to be awarded a contract.  The accreditation deadline for the first round of competitive bidding is August 31, 2007.  Suppliers should apply for accreditation immediately to allow adequate time to process their applications.  Click here for a list of the CMS-approved Deemed Accreditation Organizations.

Clarification…Timeline for eRx Proposal

As stated in an earlier Medicare Rx Update, the proposed Physician Fee Schedule rule will likely become effective on or after January 1, 2008.  However, the proposed elimination of the computer-generated fax exemption for all provider/dispenser transactions will not become effective until 1 year after the effective date of the CY 2008 PFS final rule, or on or about January 1, 2009.

Anticipated Medicaid AMP/FUL Implementation Timeline Released...

With the publication of the final rule to implement the pharmacy provisions of the Deficit Reducation Act of 2005 expected soon, CMS is receiving a growing number of questions about the timeline for implementation. Following the release of the final regulation, a number of steps will have to be taken to implement the new Federal Upper Limit (FUL) for Medicaid multi-source prescription drug reimbursements. As a result, retail pharmacies can anticipate that Medicaid generic reimbursement will not be subject to a new DRA-based FUL until the end of 2007. Read the anticipated Average Manufacturer Price/Federal Upper Limits Timeline.

Part D Question of the week...

Q: If requested, are Part D sponsors required to provide current and prospective enrollees (or their physician or authorized representative) with information regarding specific prior authorization requirements?

A: Yes. Part D sponsors must provide current and prospective enrollees (or their physician or authorized representative) with information regarding specific prior authorization criteria and other utilization management requirements. This information must be made available on a timely basis so that beneficiaries can make informed enrollment decisions, and so that physicians can access information that will help avoid delays at the pharmacy and potential interruptions in drug therapy.

CMS is encouraged by the fact that some Part D sponsors are already making specific utilization management information and requirements available through links on their formulary web pages. We highlight this as a model practice and encourage other Part D sponsors to do the same. Please see the PA Requirements QA.pdf for more detailed information.

Get Your NPI Number Today; Deadline is March 1
The March 1, 2007 deadline ensures that NCPDP is able to distribute your pharmacy's NPI among the industry to avoid possible payment disruption after May 23. Learn more. Some health plans and pharmacy claims processors began accepting claim transactions with the National Provider Identifier (NPI) for pharmacies in January. Many of these health plans and other payers utilize the NCPDP Pharmacy Database to obtain pharmacy NPIs and establish a crosswalk to match the NPI with the corresponding NCPDP ID number.

If you have not received your pharmacy’s NPI, please:
• go to https://nppes.cms.hhs.gov/NPPES/Welcome.do and apply on-line. You should receive your pharmacy’s NPI via email in a few days.
• go to http://www.ncpdp.org/frame_news_npi-info.htm and download the NCPDP and NPI Pharmacy Application Form
• (a) complete the Application Form, (b) include a copy of the NPI notification you receive from CMS via email or letter, and (c) fax to NCPDP at 480-767-1043

NCPDP is requiring all pharmacies that have not already notified NCPDP of their NPIs do so by March 1, 2007. Failure to submit your pharmacy NPI information to NCPDP by March 1, 2007 may result in rejection of your claims by some payers after May 23, 2007. There is no cost in obtaining your pharmacy’s NPI and sharing it with NCPDP. There is a significant possibility of payment disruption and resulting costs of NOT doing so.  If you are not incorporated, your pharmacist NPI and pharmacy NPI may be the same. If you have questions regarding how to obtain your pharmacy’s NPI, call CMS at 1-800-465-3203. If you have questions regarding submitting your NPI to NCPDP, call NCPDP at 480-477-1000, ext 100.

Part D Vaccine Administration... Change Effective January 1, 2007
Under Section 202(b) of the Tax Relief and Health Care Act of 2006 (TRHCA), pharmacies can receive payment under Part B for administration of a Part D-covered vaccine.  Effective January 1, 2007, payment may be made by DME MACs and DMERCs to pharmacies for the administration of Part D vaccines. Payment under Medicare Part B may be made to a pharmacy for the administration of a Part D-covered vaccine furnished to a Medicare beneficiary during 2007, provided that on the date of service the pharmacy is enrolled with the National Supplier Clearinghouse and the beneficiary is enrolled in Medicare Part D. CMS has created a G code (G0377: Administration of vaccine for Part D drug) to be used for the administration of Part D-covered vaccines in 2007.  The Part B allowed charge for G0377, effective for 2007, is $19.33. The Medicare payment would be 80% of that amount ($15.46, assuming the beneficiaries Part Bdeductible is met).  The beneficiary would pay $3.87 as a co-insurance payment, plus any Part B deductible payment that may be due. Because administration of vaccines is now a Medicare-covered service, pharmacies should not bill beneficiaries directly for administration of vaccines (except for Medicare co-insurance).  Also, it is important to note that this CR addresses only Part D-covered vaccine administration fees and it does not address payment for a Part D-covered vaccine itself.  Payment for Part D-covered vaccines is made solely by participating Part D Prescription Drug Plans. Read More.

2007 Washington-Oregon Handbook

2007 A-B-D Beneficiary Cost Share

340B Pharmacies

Guide to CMS, SSA and Plan Mailing (Summer/Fall 2006)

CMS Statement on Preferred Pharmacies

Common Medicare Situations

E1 Transaction Information

Encouraging Early In Month Enrollment

Extension of Billing Limit from 30 to 90 days

FAQ 90 day supply

I/T/U Pharmacies

Long Term Care Pharmacies

Medicare One Month Report

Part B vs. Part D Discussion

Part D FAQ

Technology at the Counter

Transition Extention to March 31st

CCRx's MTM Program through Community Pharmacies
Community Care Rx (CCRx) is paying pharmacies for Medication Therapy Management of Part D certain patients. Community pharmacies must now take advantage of this opportunity to step-up and demonstrate that Medication Therapy Management (MTM) is best delivered face-to-face by a pharmacist who knows their patient. Pharmacies can go to www.ccrx.net and lookup the number of their assigned CCRx patients that have qualified for a MTM session with their pharmacist. Brief training modules are available on the CommunityMTM website!  Read more. CMTM website.

More information about Part D for physicians’ is available on the CMS prescription drug webpage for physicians, which is at http://www.cms.hhs.gov/PrescriptionDrugCovGenIn/04_Formulary.asp#TopOfPage.

Washington State Pharmacy Association
1501 Taylor Ave. S.W.
Renton, WA 98057
425-228-7171
Fax 425-277-3897
wspa@wsparx.org