Using The New HIPAA Medicaid Subrogation Standard To Recover Drug Benefit Costs
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USING THE NEW HIPAA MEDICAID SUBROGATION STANDARD TO RECOVER DRUG BENEFIT COSTS Catherine C Graeff, Principal, Sonora Advisory Group, LLC Mark Elliott, Principal Consultant, ME Healthcare Systems Consulting
description
In addition to new versions of existing standards named in the Final Rule, HHS also adopted a new HIPAA standard for Medicaid subrogation for pharmacy claims. The compliance date for the Medicaid subrogation standard is also January 1, 2012, except for small health plans, which will have until January 1, 2013 to come into compliance. The NCPDP Medicaid Subrogation Standard provides a consistent and well-defined transaction format for use in Medicaid Subrogation, which results in time savings and accuracy in subrogation transactions, reconciliation and recoveries. Participants will learn about NCPDP Medicaid Subrogation Standard Version 3.0, the Medicaid Subrogation process as it relates to Telecommunication Standard D.0, and new fields that were created in the Telecommunication Standard D.0 specifically for Medicaid Subrogation and that are crucial for successful subrogation transactions.
Transcript of Using The New HIPAA Medicaid Subrogation Standard To Recover Drug Benefit Costs
USING THE NEW HIPAA MEDICAID
SUBROGATION STANDARD TO RECOVER
DRUG BENEFIT COSTS
Catherine C Graeff, Principal, Sonora Advisory Group, LLC
Mark Elliott, Principal Consultant, ME Healthcare Systems Consulting
LEARNING OBJECTIVES
Why the Standard Was Developed
Benefits to Medicaid
Challenges to Address
Example Use of the Standard
WHO IS NCPDP?
ANSI accredited standards development organization
More than 1,600 members
Representing pharmacies, government and commercial payers, software vendors, processors/PBMs, general interest
Involved in standardization of data and transactions in pharmacy services sector
DEFINITIONS
Medicaid Subrogation
Third Party Liability (TPL)
Cost-Avoidance
Payment Coordination
HIPAA STANDARD
HIPAA enacted August 21, 1996
Subtitle F of Title II Amends SSA
New Part C – “Administrative Simplification”
August 17, 2000 – Final Transaction and Code Sets Rule published
January 16, 2009 – Updates to standards published as well as new Medicaid Subrogation Standard for Pharmacy Claims v3.0
Compliance Date 1/1/2012 (except small health plans)
Not prohibited from using paper
WHY THE SUBROGATION STANDARD?
Some states require Medicaid to “pay and
chase”
Other agencies may not be aware of TPL at time
claim is paid and must subrogate later
Recoupment from pharmacy difficult and may
lead to access issues.
States using a variety of formats specific to other
payers
Lack of uniformity leads to denial of
reimbursement
HISTORY OF THE STANDARD
CMS, several Medicaid states and NCPDP
began work on standard in 1999
Combines a subset of data from NCPDP
Telecommunication claim transaction with
additional elements that Medicaid needs
Medicaid paid amount
Medicaid agency ID
June 2000 – Version 2.0 Batch standard was
released and used by some entities
MEDICAID SUBROGATION V3.0
Batch Standard v1.2
Incorporated data from Telecommunication Standard vD.0
Applicable to Medicaid Agencies in their role as health plans and other payers
Purpose to seek reimbursement from the responsible health plans May be the health plan’s contracted PBM or claims
processor
Without HIPAA “status” difficult for Medicaid agencies to get payers to standardize
IMPACT OF IMPLEMENTATION
Reduction in administrative costs
number of formats used by agencies to
subrogate pharmacy claims is costly for
industry
Improve collections for pharmacy claims
Decrease in attempts to recoup from
pharmacy providers
Aids in collecting reimbursement from liable
third parties
BENEFITS TO MEDICAID AGENCIES
Electronic submission implies automated
adjudication
Improve Collections and Timeliness
Reduce Administrative Costs
New fields specifically designated for
Subrogation claims
AUTOMATED ADJUDICATION
Reduction in manual entry errors
Timely processing
Consistent method of response
PHARMACY DATA FLOW
Core
MMIS
PO
S
D
W
NCPDP Telecom v5.1 / Batch v1.1
TPL
NCPDP Telecom vD.0 / Batch v1.2
Example:
Larger Rx Numbers
Examples:
Prescriber
Demographics
Route of Administration NCPDP Telecom vD.0 / Batch v1.2
Example:
Multi-ingredient
Compound
Detail
SUBROGATION PROCESS FLOW
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Core
MMIS
PO
S
TP
L
NCPDP Telecom vD.0 / Batch v1.2
NCPDP Medicaid Subrogation v3.0
BENEFITS OF FIELDS FOR SUBROGATION
Actual Medicaid paid amount is in its own
field, not just what the pharmacy requested
The Pharmacy POS / MMIS Transaction
Control Number is submitted and must be
returned in the response to facilitate proper
reconciliation
Medicaid beneficiary IDs also included in the
submission to facilitate proper tracking of the
member and state / state benefit program
IMPLEMENTATION CHALLENGES
The Medicaid Subrogation Standard is
complex
Built upon NCPDP Batch and
Telecommunication Standards
Uses variable length fields and segments with
their corresponding field and segment identifiers
Payer Sheets
Commonly known between pharmacy and POS,
but may be brand new concept to the TPL side of
the MMIS
HOW COMPLEX CAN IT BE?
An old example
Fixed implementation… 123456789 |1234567|ØØØØ6Ø94268|ØØØØ3ØØØØ|ØØ|Ø3Ø|N|Ø|2Ø11Ø715 …
… 321654987 |Ø294551|ØØ11Ø677211|ØØØ1ØØØØØ|Ø2|Ø9Ø|N|Ø|2Ø1Ø12Ø9 …
Using the new standard
Variable implementation…<1E><1C>AMØ4<1C>C2123456789<1D><1E><1C>AMØ7<1C>EM1<1C>D21234567<1C>E
1Ø3<1C>D7ØØØØ6Ø94268<1C>E73ØØØØ<1C>D3Ø<1C>D53Ø<1C>D61<1C>D8Ø<1C>DE2Ø1
1Ø715……<1E><1C>AMØ4<1C>C2321654987<1D><1E><1C>AMØ7<1C>EM1<1C>D2294551
<1C>E1Ø3<1C>D7ØØ11Ø677211<1C>E71ØØØØØ<1C>D32<1C>D59Ø<1C>D61<1C>D8Ø<1C
>DE2Ø1Ø12Ø9…
PAYER SHEETS
The NCPDP Standards use “Required When”
situations for submitted data
Payer Sheet Template designed by NCPDP
SNIP Committee to establish uniform
“programmable” guidance from receiver to
submitter
Medicaids have to provide Payer Sheets to their
provider networks
NCPDP PAYER SHEET TEMPLATE
IMPLEMENTATION GUIDE FOR VERSION D.Ø VERSION 1.2
Used as guidance in filling out and creating a NCPDP Telecommunication Standard Implementation-based Version D.Ø Payer Sheet
January 2Ø11 National Council for Prescription Drug Programs 924Ø East Raintree Drive Scottsdale, AZ 8526Ø Phone: (48Ø) 477-1ØØØ Fax: (48Ø) 767-1Ø42 E-mail: [email protected] http: www.ncpdp.org
PAYER SHEETS (CONTINUED)
Alignment of Medicaid collection of data with
3rd party requirements
Medicare Part D
Large PBMs’ commercial plans
Medco
CVS/Caremark
Express Scripts
Prescription Solutions
Prime Therapeutics
Others, regionally
EXAMPLES OF USE
Paid one ingredient – the basic claim
Prior payer to Medicaid, paid COB included
Prior payer to Medicaid, rejected COB
included
Special case – returning to payer that rejected
Multiple ingredients submitted
NCPDP ROLE – BEYOND THE STANDARD
NCPDP SNIP Gather industry comments
Creates White Papers
Organizes testimony provided to HHS / NCVHS
Creates Payer Sheet Templates
NCPDP Work Groups Reviews other SDO standards that affect pharmacy
industryCreates mapping document
Creates user guides
Provides updates from SDO meetings and conference calls
Creates FAQ documents
RESOURCES FOR MORE INFORMATION
Final Rule
NCPDP
Government Programs - Work Group 9
Medicaid Subrogation v3.0 Implementation
Guide
Medicaid Subrogation FAQ Task Group
Medicaid Subrogation Questions, Answers and
Editorial Updates
