Transcript DRA - Welcome to Arkansas Medicaid

Federal Deficit
Reduction Act
(DRA)
October/November 2007
October/November 2007
Agenda
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Background
Covered labelers
NDC configuration
Billing principles
NDC quantity
Claim filing
Codes requiring manual review
Adjustments
Remittance advice
Electronic rejections
Explanation of Benefits (EOB)
DESI drugs
Record retention
Billing tips
Q&A
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Background
• The Federal Deficit Reduction Act of 2005
mandates that Medicaid require the submission of
National Drug Codes (NDCs) on claims submitted
with procedure codes for drugs administered. The
purpose of this requirement is to assure that the
states obtain a rebate from those manufacturers
who have signed a rebate agreement with the
Centers for Medicare and Medicaid Services
(CMS).
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Background
• This requirement is applicable to claims with a date
of service on or after January 1, 2008, and applies
to professional and outpatient institutional claims.
This will apply to the following claim transactions:
–Electronic claims (837P and 837I Outpatient)
–DDE (837P and 837I Outpatient)
–Paper CMS-1500 claims
–Paper CMS-1450 (UB-04) claims (Outpatient)
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Covered labelers
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Covered labelers
• A pharmaceutical manufacturer that has entered
into a federal rebate agreement with the Centers for
Medicare and Medicaid Services (CMS)
• First segment of NDC
• www.medicaid.state.ar.us
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• Effective date: The
date a manufacturer
entered into a rebate
agreement with CMS
• Termination date: This
date indicates that the
manufacturer no longer
participates in the
federal rebate program
and therefore the
products cannot be
reimbursed by
Arkansas Medicaid for
dates of service outside
the rebate participation
date.
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NDC configuration
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Definitions
• National Drug Code (NDC): National Drug Code
(NDC) is a unique 10-digit, three-segment number
assigned by the Food and Drug Administration
(FDA)
• NDC Termination Date: The shelf-life expiration
date of the last batch produced, as supplied on the
Centers for Medicare and Medicaid Services (CMS)
quarterly update. This date is supplied to CMS by
the drug manufacturer/distributor.
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NDC configuration
5-4-2 format
• First segment: Labeler code (5-digits)
–Labeler: Any firm that manufactures, repacks, or
distributes a drug product
• Second segment: Product code (4-digits)
–Identifies a specific drug, strength, and dosage
form of drug
• Third segment: Package code (2-digits)
–Identifies the package size
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NDC configuration
00123
0456
78
LABELER
CODE
PRODUCT
CODE
PACKAGE
CODE
(5 digits)
(4 digits)
(2 digits)
http://www.medicaid.state.ar.us
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NDC configuration
• NDCs submitted must use 11-digit format
• No dashes or spaces
10-digit FDA NDC
on PACKAGE
Required 11-digit NDC
(5-4-2) Billing Format
12345 6789 1
12345678901
1111-2222-33
01111222233
01111 456 71
01111045671
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NDC configuration example
• Providers must bill the NDC on the label of the drug
that is administered
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Billing principles
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NDC billing principles
• Enlist the cooperation of all staff to assure collection
or notation of NDC from actual package used
• Billing of NDCs should not be based on a reference
list due to varying NDC:
–Labelers
–Package sizes
–Time periods
• There is not a requirement for an NDC when billing
vaccines
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About the NDC quantity
• The HCPCS/CPT code billing units and NDC
quantity do not always have a one-to-one
relationship. The NDC quantity is based on the
strength of the drug administered per unit, and the
designated strength of the HCPCS/CPT code.
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NDC and HCPCS/CPT code quantity
Example
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NDC and HCPCS/CPT code quantity
Example
HCPCS/CPT Code Unit = 1
(one 25 mg unit of Drug B)
NDC Quantity = 5 for the 5 ml
administered
Waste = 5 ml or 25 mg
(for the 5 ml or 25 mg not administered)
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Claim filing
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PES version 2.08
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Billing instructions – PES
837 Professional Service 2 tab
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Billing instructions – PES
837 Professional RX tab
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Billing instructions – PES
837 Institutional Outpatient Service tab
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Billing instructions – PES
837 Institutional Outpatient RX tab
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Billing instructions – DDE
Professional
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Billing instructions – DDE
Institutional Outpatient
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Billing instructions – Vendor
• If billing electronic claims using vendor software,
check with your vendor to ensure your software will
be able to capture criteria necessary to submit claims
• Vendor companion guides:
https://www.medicaid.state.ar.us/Provider/hipaa/compan.aspx
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Billing instructions – CMS-1500
To report the NDC on the CMS-1500 claim form, providers must enter the following
information into the shaded portion of fields 24A to 24H
1. Enter the NDC qualifier of N4
2. Enter the NDC 11-digit numeric code
3. Enter the NDC Unit qualifier
• F2 – International Unit
• GR – Gram
• ML – Milliliter
• UN – Unit
4. Enter the NDC Quantity (Administered/Billed Amount) in the format 9999.99
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Billing instructions – CMS-1450 (UB-04)
Outpatient
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Codes requiring manual review
• Sent on paper for review
• DMS-664
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Adjustments
• Paper adjustments for paid claims filed with NDC
numbers will not be accepted
• The entire claim will have to be voided and a
replacement claim will need to be filed
• Providers can adjust a paper claim with NDC
numbers or an electronic claim with NDC numbers
electronically
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Remittance advice
• Reimbursement will not change
• Only the first sequence in a detail will be displayed
reflecting the total paid amount or denial EOB
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Electronic rejections
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Electronic rejections
3770- Bill specific procedure code for
administered drugs
This claim has rejected because the provider has not
included an NDC for a HCPCS/CPT code that
requires one
3780- Procedure codes and NDC do not match
Claim has rejected because the NDC submitted on
the claim is not associated to the HCPCS/CPT code
billed
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Electronic rejections
3790- NDC &/or labeler is not qualified for a
rebate or is outside rebate dates
• Claim has rejected because there is no active
rebate agreement in place on the DOS for the NDC
on the claim
• Arkansas Medicaid will not reimburse for
HCPCS/CPT codes with non-payable NDCs
• Providers are responsible for ensuring that the NDC
of the drug that they are administering is from a
covered labeler
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Electronic rejections
9050- Discontinued drug
Claim has rejected because the NDCs CMS
termination date is on or before the date of service
9150- DESI drug not payable
Arkansas Medicaid does not pay for drugs that are
less than effective, also known as DESI drugs
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Explanation of Benefits (EOBs)
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Explanation of Benefits (EOBs)
EOB - 905
Drug not covered, check NDC, may be obsolete
EOB - 915
DESI drug not payable by Medicaid
EOB - 924
Procedure code requires NDC(s) for administered
drugs
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Explanation of Benefits (EOBs)
EOB - 925
Procedure code and NDC do not match
EOB - 926
NDC &/or labeler is not qualified for rebate or is
outside rebate dates
EOB - 927
Bill specific procedure code for administered drugs
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Drug Efficacy Study Implementation
(DESI)
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Drug Efficacy Study Implementation
(DESI)
• Program administered by the FDA to review the
effectiveness of drugs approved between 1938 and
1962
• If the drug indicates a lack of substantial evidence
of effectiveness, the FDA will publish its proposal to
withdraw approval of the drug for marketing
• HCPCS/CPT codes will not be payable when linked
to any NDC with a DESI indicator
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Drug Efficacy Study Implementation
(DESI)
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Record retention
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Record retention
• Records must be retained for five years
• Manufacturer may dispute drug rebate
• Requested records may include:
–NDC invoices showing purchase of drugs
–Documentation showing what drug was
administered, dosage, route of administration,
and waste
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Billing tips
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Billing tips
• Bill HCPCS/CPT codes the same as always
• Make sure your NDC is an 11-digit number without dashes or
spaces, using the 5-4-2 format
• Include all NDCs associated with the HCPCS/CPT code
• Determine if the manufacturer is a covered labeler
www.medicaid.state.ar.us
• When billing electronic claims, each NDC sequence must have a
dollar amount
• Providers billing paper claims with multiple NDCs will require a
zero amount after the first NDC sequence
• There is not a requirement for NDC billing of vaccines
• When billing a HCPCS/CPT procedure code that requires review
by the state, you must include the DMS -664
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