Transcript Coverage Gap Discount Program

Coverage Gap Discount Program
Manufacturer Webinar
December 12, 2012
Announcements
• Welcome to the first of a new series of Manufacturer
Webinars
• Today’s content is based on questions received by
CMS from pharmaceutical manufacturers and others
• Topics for future webinars may be sent, at anytime,
to [email protected]
• Slides will be posted to the TPA website,
http://tpadministrator.com after the webinar
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Webinar Schedule 2013
• February 13
• April 17, June 12, August 14, October 9,
December 11
• Send topics to: [email protected]
• Wednesday, Time TBD
• ListServ announcement with registration
instructions, Event Reminder, Web and Phone
Access Information
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Agenda
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Benefit Design
New TPA website
File Submission Errors
Online Payment Confirmation
Negative Amounts
2014 Manufacturer Agreement
Coverage Gap Mock Up with 2009 data
Resources
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Benefit Design
Presented by Tara Waters
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DEFINED STANDARD BENEFIT 2012
APPLICABLE BENEFICIARIES AND
APPLICABLE DRUGS
YTD Gross
Covered Drug
Costs
$320
$2,930
75% Plan Pays
$6,730.39
Gap Discount for
Applicable Drugs–
50%
Coverage
Gap
Deductible
25%
Coinsurance
80% Reinsurance
Total Drug Cost –
Gap Discount
$4,700 TrOOP
15% Plan Pays
Beneficiary Liability
Direct Subsidy/
Beneficiary Premium
Medicare Pays Reinsurance
5% Coinsurance
Gap Discount for Applicable Drugs
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STRADDLE CLAIMS
Cross one phase of the benefit to another
phase of the benefit
Deductible
Phase
Initial
Coverage
Phase
Straddle
Catastrophic
Coverage
Coverage
Gap Phase
Phase
Straddle
Straddle
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BASIC BENEFIT PLAN TYPES
Defined
Standard
(DS)
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Statutorily mandated cost sharing and benefit
parameters that the plan sponsor cannot change
Actuarially
Equivalent
(AE) *
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Must use the same deductible and initial coverage
limit that apply in the DS benefit
Can change cost-sharing in the Initial Coverage
Phase and/or Catastrophic Coverage Phase from
the DS amounts, including use of tiers
Basic
Alternative
(BA) *
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Can reduce the deductible, lower or raise the initial
coverage limit, and/or change cost-sharing in the
Initial Coverage Phase, including use of tiers
*The actuarial value remains equivalent to a DS benefit plan such that no
supplemental premium is required.
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TIERED COST-SHARING
• Tiered cost-sharing is an alternate way to
implement cost-sharing.
• Plans may deviate from the standard costsharing rates provided their proposed
cost-sharing passes actuarial tests for
being actuarially equivalent to the DS
benefit.
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EXAMPLE OF A TIERED BENEFIT
Tier
Cost-Sharing
Description/Drug Class
1
$5
Generic Drugs
2
$20
Preferred Brand Drugs
3
$40
All Other Brand Name Drugs
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25%
Specialty Drugs
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Benefits Guidance
• HPMS Guidance
– “Additional Guidance Concerning Closing the Coverage Gap in 2011”
released September 10, 2010
– “Medicare Coverage Gap Discount Program – Maximum Applicable
Discounts” released January 27, 2012
• Prescription Drug Event Data Technical Assistance Participant
Guide
– Module 4 - on Calculating and Reporting the Basic Benefit
– Module 7 - Calculating and Reporting the Enhanced Alternative
Benefit
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New TPA Web Site
Overview
Presented by Donna Kellett
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New TPA Website
• http://tpadministrator.com
• New email addresses
– [email protected] WEBINAR ONLY
– [email protected]
• New content being rolled out
• Improved functionality
• Online, real time HELP coming soon
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TPAdministrator.com
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File Submission Errors
Common Errors on Payment
Confirmation Submissions
Presented by Donna Kellett
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Edit Code Frequency
File Rejection Errors on Payment Confirmation File Submissions
E004 Invalid FILE ID
E008 Payment Amount not Numeric
E007 No Date Entered/Invalid, or Date is > Current Date
E010 Invalid Record Types in File
E015 Confirm Date Precedes Invoice Report Distribution Date
E019 Payment Method is Invalid or Missing
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E019 – Payment Method Is Invalid Or Missing
Accepted methods are:
1 – ACH
2 – Wire
• If something other than the two acceptable methods
(1 or 2) is indicated, or if nothing at all is placed in
this field, the system will generate an E019 edit.
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E010 – Invalid Record Types In File
INCORRECT SUBMISSION
TPAMH20110100001172011042509562010MPCP999920110804
H9999
INVALID RECORD TYPE
TPACH20110100000012011042509562010MPCH9999
LBLR 2011010000001P9999H9999633040000000203D
TPACT20110100000012011042509562010MPCH9999000000100000000000000{…
H8888
INVALID RECORD TYPE
TPACH20110100000022011042509562010MPCH8888
LBLR 2011010000001P9999H8888633040000000203D
TPACT20110100000022011042509562010MPCH8888000000100000000000000{…
CORRECT SUBMISSION
TPAMH20110100001172011042509562010MPCP999920110804
TPACH20110100000012011042509562010MPCH9999
LBLR2011010000001P9999H9999633040000000203D
TPACT20110100000012011042509562010MPCH9999000000100000000000000{…
TPACH20110100000022011042509562010MPCH8888
LBLR 2011010000001P9999H8888633040000000203D
TPACT20110100000022011042509562010MPCH8888000000100000000000000
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Payment Confirmation
Online Application
Presented by Donna Kellett
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Online Payment Confirmation
• Beta testing starting soon with a small group
of manufacturers
• Other test groups will be selected to test the
application
• If you would like to be in a test group contact
the TPA
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Online Payment Confirmation
• How will it work?
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Log on to TPA web site Payment Confirmation application
Choose from a list of your Quarterly Invoice reports
See the amounts due to be paid to contracts
Confirm payments by screen or by item
Receive error messages and instructions on how to fix in
real time
– Payment Confirmation file is formatted and submitted for
you
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Online Payment Confirmation
Invoice List
•Listed by quarter
•Shows latest status
•Actions available:
oDownload
Invoices
Submitted Confirm
Files
oConfirm Payments
oView History
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Online Payment Confirmation
Confirmation Line Items
Modify:
• Paid Amount
• Paid Date
• Pmt Method
ACH is the preferred payment method
and is the most cost efficient in most
cases.
•Keeps track of out of
balance lines and
amounts
•Provides real-time edit
checking
•Formats the
submission file
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Online Payment Confirmation
Transmit
View Totals
•Invoiced Amounts
•Confirmed Amounts
•‘Yes’ click needed
to submit
confirmation
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Online Payment Confirmation
Process Confirmation
•Date and Time stamped
•Success or Failure Msg
•Option to Download
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Online Payment Confirmation
• Actual screens may differ from the prototype
screens shown here
• Advantages of an online process
– Saves time
– Improves accuracy
– No need to reformat files into the proper layout
Negative Invoice Amounts
Identification and Resolution
Presented by Donna Kellett
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Negative Amounts
• How Did They Happen?
– Adjustment to a previously invoiced amount
– Money owed to the manufacturer
– Discount amounts within the same quarter may
not have been enough to cover the negative
amount
– No methodology exists to recover that amount for
Manufacturers
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Negative Amounts
Example
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PXXXX Pharma Co. Was Invoiced for Discounts to HXXXX Health Plan, Inc
• 2011 Q1 $300.00 Paid and Confirmed
• 2011 Q2 $200.00 Paid and Confirmed
• 2011 Q3 $100.00- Adjustment to Previously Paid Discount is processed,
Money is owed to Manufacturer, No Method Exists to Refund to
Manufacturer
• 2011 Q4 $200.00 Paid and Confirmed
• This Manufacturer was Invoiced, and Paid $700.00 in Gap Discounts
• BUT This Manufacturer is Still Owed $100.00 for the Adjustment in Q3
2011
• Manufacturer will need to be reimbursed for that $100.00 by the Plan
• Net Gap Discount Amount paid by Manufacturer, after reimbursement, is
$600.00
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Negative Amounts
Proposed Solution 1 – Balance
• The TPA will distribute a statement showing each
Manufacturer and Part D sponsor the amounts they are
owed or owe
• 2011 Quarters 1 – 4 and 2012 Quarters 1 – 4
• Statement will be issued early in 2013
• Manufacturers will have a period of time to provide their
EFT information to the TPA for distribution to the Part D
sponsors
• Manufacturer and Part D sponsors will have a period of
time to verify the amounts on the statement
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Negative Amounts
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Proposed Solution 1 – Balance (con’t.)
Payment will be due to manufacturers at the end of
verification period
Both parties will confirm online to the TPA
2013 Quarters will be balanced in February 2014.
Permanent fix will not be applied until 2014 due to
existing maintenance schedules
A calendar of the verification, EFT set up, payment
and confirmation deadlines will be published before
implementation
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Negative Amounts
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Proposed Solution 2 – Maintain
Beginning with Quarter 1 2014 Negative Amounts will
be balanced within the invoice cycle
Negative Balance will be offset by the quarterly charges
if possible
Negative Balances will be carried from quarter to
quarter and offset until they are consumed
Some balances may remain due to contract changes,
manufacturer mergers, and other issues
Outstanding negatives will be balanced after a
threshold is reached
Negative Amounts
DRAFT Statement
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Negative Amounts
• CMS will issue guidance in January concerning
negative amounts
• Other solution options will be considered,
such as
• Today’s example
• P2P model
• Comment period will allow industry to provide
input
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The 2014 Manufacturer Agreement
Overview of the 2014 cycle
Presented by Shelly Winston
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Manufacturer Agreement
• 2014 Manufacturer Agreement has been updated to conform with
regulation published in April 2012(77 FR 22072)
• Model Agreement is available for viewing on the CMS Manufacturer
Page (http://www.cms.gov/Medicare/Prescription-DrugCoverage/PrescriptionDrugCovGenIn/Pharma.html)
• All Manufacturers must re-sign the agreement through HPMS
• This means that a manufacturer’s signatory must
– Be designated in HPMS as a signatory, and
– Have a CMS user ID with HPMS access
• Deadline for signature is January 30, 2013
• Questions should be send to [email protected]
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Coverage Gap Mock Up with 2009 data
Presented by Mark Newsom
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Estimating Long-Term CGDP
Prescription Drug Event Submission Patterns
• Used Coverage Year 2009 PDEs to estimate long-term
patterns of submission of PDEs that would have had
gap discount amounts if the Affordable Care Act
(ACA) had been in place at that time.
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02/01/2012
01/01/2012
12/01/2011
11/01/2011
10/01/2011
09/01/2011
08/01/2011
07/01/2011
06/01/2011
05/01/2011
04/01/2011
03/01/2011
02/01/2011
01/01/2011
12/01/2010
11/01/2010
10/01/2010
09/01/2010
08/01/2010
07/01/2010
06/01/2010
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06/01/2012
05/01/2012
25,000,000
04/01/2012
03/01/2012
26,065,161
05/01/2010
04/01/2010
03/01/2010
02/01/2010
01/01/2010
12/01/2009
11/01/2009
10/01/2009
09/01/2009
5,000,000
08/01/2009
07/01/2009
2,247
06/01/2009
05/01/2009
04/01/2009
03/01/2009
02/01/2009
01/01/2009
Estimated Cumulative
“Gap Discount” PDEs, 2009
30,000,000
Recon cutoff
26,433,360
26,416,315
22,371,935
20,000,000
17,791,347
15,000,000
13,798,578
10,000,000
10,269,695
7,441,641
4,564,229
2,609,222
1,252,502
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What does this tell us?
• PDEs were originally created to facilitate reconciliation of
prospective payments to Part D plan sponsors.
• Due to the complexity of Part D, even when all goes well
CMS generally does not receive a PDE until 30 days after
the dispensing event.
• We estimate that approximately 4 million “gap discount”
PDEs were submitted for 2009 between the end of the
calendar year and the June reconciliation cutoff in 2010.
• Plans generally get their PDEs in by the June cutoff in the
subsequent year for the annual payment reconciliation.
• A small (net) number of PDEs are subsequently deleted
after the reconciliation. This is usually due to audit activity
by the plan, CMS, or the OIG uncovering claims that should
not have been paid.
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Caveats
• Drug mix is different now than it was then.
• Initial coverage limit and catastrophic (TrOOP)
levels change every year.
• Pattern is different for high cost specialty drugs
that push the beneficiary through the initial
coverage phase faster.
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Other Considerations
• There is a lag between PDE submission and CGDP
invoice generation due to the quarterly billing cycle.
• In any given time period about 4-6% of PDE
submissions are rejected by one or more of the 150+
edit checks the Drug Data Processing System (DDPS)
applies. Rejected PDEs typically take at least 90 days to
be resolved and correctly resubmitted. However, more
complicated issues have been known to take 6-12
months to resolve.
• CGDP PDEs that make it through the front-end editing
process are subject to additional quality analysis before
invoicing. This process adds lag time to invoicing.
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Resources
Presented by Christine Oliver
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Resources
New TPA website - http://tpadministrator.com
• Suggestions for future webinar topics to
[email protected]
• Webinar slides will be posted at http://tpadministrator.com
• Questions related to dispute files and invoices should be sent to
[email protected]
• Questions related to the Manufacturers Agreement or compliance
issues should be sent to [email protected]
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Resources
2011 Prescription Drug Event Data Technical Assistance Participant Guide
(http://www.csscoperations.com/internet/Cssc.nsf/files/PDEParticipantGu
ide%20cameraready%20081811.pdf/$FIle/PDEParticipantGuide%20camer
aready%20081811.pdf)
• Module 4: Calculating and Reporting the Basic Benefit
• Module 5: Calculating and Reporting Total Gross Covered Drug Costs (TGCDC)
and True Out-Of-Pocket Costs (TrOOP)
• Module 7: Calculating and Reporting Enhanced Alternative Benefit
• Module 10: Coverage Gap Discount Program Invoice and Payment Process
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Resources
HPMS Guidance
• Access to HPMS through Gateway at https://gateway.cms.gov
• “Additional Guidance Concerning Closing the Coverage Gap in 2011”
released September 10, 2010
• “Medicare Coverage Gap Discount Program – Maximum Applicable
Discounts” released January 27, 2012
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Resources
Medicare Coverage Gap Discount Program Instructions and Agreements for
2014 - http://www.cms.gov/Medicare/Prescription-DrugCoverage/PrescriptionDrugCovGenIn/Pharma.html
• HPMS memo: “Revised Coverage Gap Discount Program Agreement for 2014”
released October 19, 2012
• Access to HPMS through Gateway at https://gateway.cms.gov
• The Agreement will be available for manufacturer signature from December 4,
2012 to January 30, 2013
• Questions related to the instructions or Agreements should be sent to
[email protected]
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Conclusion
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Thank you for attending today’s webinar
Contact the TPA with questions, comments
Help Line: 1-877-534-2772
Hours: Monday thru Friday 8am to 7pm ET
Webinar specific: [email protected]
General: [email protected]
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