The federal Omnibus Budget Reconciliation Act of 1990 (OBRA `90) established Medicaid program requirements regarding several aspects of pharmacy practice. One of the requirements of OBRA `90 was a Drug Utilization Review (DUR) program for Medicaid outpatients to improve the quality and cost-effectiveness of recipient care.
Providers should refer to Phar. 7.01(1)(e) and 7.08, Wis. Admin. Code, and 450.01(16)(i), Wis. Stats., for detailed information about Wisconsin’s DUR requirements.
The OBRA `90 requires that Medicaid DUR programs should have all the following:
Individual pharmacies are responsible for prospective DUR, while Wisconsin Medicaid is responsible for the retrospective DUR and the educational program. Further differences can be found in the table below.
To help individual pharmacies comply with their prospective DUR responsibility, Wisconsin Medicaid developed a prospective DUR system. The system screens certain drug categories for clinically significant potential drug therapy problems before the prescription is dispensed to the recipient. Prospective DUR enhances clinical quality and cost-effective drug use.
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Prospective vs. Retrospective Drug Utilization Review |
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Prospective Drug Utilization Review
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Retrospective Drug Utilization Review
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When a claim is processed for a drug that has the potential to cause problems for the recipient, Wisconsin Medicaid returns an alert to inform the pharmacy provider of the potential problem. The provider is then required to respond to the alert to obtain reimbursement from Wisconsin Medicaid. The provider is required to resubmit the claim and include information about action taken and the resulting outcome.
Please note: although Medicaid’s prospective DUR system alerts pharmacy providers to a variety of potential problems, it is not intended to replace pharmacists’ professional judgement. Potential drug therapy problems may exist which do not trigger the Prospective DUR system. Prospective DUR remains the responsibility of the pharmacy, as required by federal and state law. Medicaid’s system is an additional tool to assist pharmacists in meeting this requirement.
The Wisconsin Medicaid DUR Board, required by federal law, consists of three physicians, five pharmacists, and one nurse practitioner. The board and the Department of Health and Family Services (DHFS) reviews and approves all DUR criteria and establishes the hierarchy of alerts.
Under the prospective DUR system, only reimbursable claims for Medicaid fee-for-service recipients submitted through real-time Point-of-Sale (POS) are reviewed. Although paper claims, compound drug claims, and electronic media claims are not reviewed by the Medicaid prospective DUR system, pharmacy providers are still required under provisions of OBRA `90 to perform prospective DUR independently.
Real-time claims for nursing home recipients are reviewed through the prospective DUR system; however, they do not require a response to obtain reimbursement since billing for these recipients does not always occur at the same time the drug is dispensed.
The nursing home pharmacist consultant continues to be responsible for prospective DUR.
For each recipient, Wisconsin Medicaid activates alerts that identify many potential problems. The Wisconsin Medicaid DUR Board established a hierarchy for the order in which multiple alerts appear if more than one alert is activated for a drug claim. Factors taken into account in determining the hierarchy include the potential for avoidance of adverse consequences, improvement of the quality of care, cost savings, likelihood of a false positive, retrospective DUR experience, and a review of alerts used by other state Medicaid programs for prospective DUR. The clinical drug tables used to establish the alerts are provided to Wisconsin Medicaid by First DataBank, Inc.
Wisconsin Medicaid activates alerts that identify the following problems, which are presented in hierarchical order:
Wisconsin Medicaid activates this alert when another drug in claims history may interact with the drug being filled. The system reviews not only the prescriptions at the provider’s pharmacy, but all of the prescriptions reimbursed by Medicaid fee-for-service.
Wisconsin Medicaid activates this alert when a drug is being prescribed for a recipient with a disease for which the drug is contraindicated. Acute diseases remain in the recipient’s medical profile for a limited period of time, while chronic diseases remain permanently. The disease may have been reported on a medical claim, or inferred from a drug in claims history:
Wisconsin Medicaid activates this alert when another drug is present in claims history that has the same therapeutic effect as the drug being dispensed. The message sent to the provider includes the drug name in claims history that is causing the alert. The therapeutic areas for the duplication alert may include but are not limited to:
Wisconsin Medicaid activates this alert when the prescribed drug is contraindicated in pregnancy. This alert is activated when all of the following conditions are met:
Codes D, X, and 1 are defined as follows:
| D: | There is positive evidence of human fetal risk based on adverse reaction data from investigational or marketing experience or studies in humans. However, potential benefits may warrant use of the drug in pregnant women despite potential risks if the drug is needed in a life-threatening situation or for a serious disease for which safer drugs cannot be used or are ineffective. This is an FDA-assigned value. |
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| X: | Studies in animals or humans have demonstrated fetal abnormalities and/or there is positive evidence of human fetal risk based on adverse reaction data from investigational or marketing experience, and the risks involved in use of the drug in pregnant women clearly outweigh potential benefits. This is an FDA-assigned value |
| 1: | No FDA rating but is contraindicated or not recommended; may have animal and/or human studies or pre- or post-marketing information. This is a First DataBank, Inc.-assigned value. |
Wisconsin Medicaid will deactivate the pregnancy diagnosis from the recipient’s medical profile after 260 days or if an intervening diagnosis indicating delivery or other pregnancy termination is received on a claim.
Wisconsin Medicaid activates this alert when a recipient is requesting a refill of his or her prescription early. The alert is sent to the provider if a claim is submitted before 75% of the previous claim’s days supply for a drug should have been used. The alert gives the number of days' that should remain on the prescription, not the day that the drug can be refilled without activating the alert. Drugs with up to a 10-days' supply are excluded from this alert. Wisconsin Medicaid monitors a comprehensive list of drug categories that excludes antibiotics, insulins, IV solutions, electrolytes except potassium, blood components and factors, and diagnostic drugs.
Wisconsin Medicaid activates this alert when a prescribed drug causes a cumulative effect with other drugs in the claims history. Points accumulate for side effects based on the severity and the frequency of the side effect. Once a defined threshold is reached, the alert is sent to the provider.
Wisconsin Medicaid uses National Council for Prescription Drug Programs (NCPDP) field 526 (Additional Message Information) to provide pharmacy providers with additional drug history information when the additive toxicity alert is activated. Up to six drugs from the history that activated the alert are displayed in this field.
Wisconsin Medicaid activates this alert when a prescription drug should not be dispensed to the recipient because of age precautions specific to the drug. This alert only applies to recipients who are 18 years old or less.
Wisconsin Medicaid activates this alert when a recipient is late in obtaining a refill for maintenance drugs such as those listed below. The alert is sent to the provider when a drug is refilled and it exceeds 125% of the days supply on the same drug in history. The number of days' late is calculated as the days' after the prescription should have been refilled. Drugs with up to a 10-days supply are excluded from this alert. This alert applies to, but is not limited to, the following therapeutic categories:
The provider is required to respond to the alert to obtain reimbursement from Wisconsin Medicaid. To respond, providers need to have access to all prospective DUR database fields within the NCPDP Telecommunication Standards 3C, 3.2 variable, or 4.0 variable formats (as of September 1999). The required fields are listed in Appendix 1 of this section. Providers are strongly encouraged to contact their software vendors to ensure that they have access to these fields.
Using the fields listed in Appendix 1 of this section, providers can also pre-override anticipated alerts. Wisconsin Medicaid prospective DUR allows pre-overrides if the drug in claims history that would activate an alert was dispensed from the same pharmacy.
Prospective DUR alerts are returned to pharmacy providers as a conflict code, which is NCPDP field 439. The explanation of the alert is in NCPDP field 544. When more than three alerts are activated by one claim, the system indicates this in NCPDP field 535, the DUR overflow indicator. Providers will need to call Medicaid Provider Services at (800) 947-9627 or (608) 221-9883 to find out additional alert information.
Refer to Appendix 2 of this section for a chart listing the conflict names, codes, and messages for each of the prospective DUR alerts.
The claims processing system includes certain edits and audits. Edits check the validity of data on each individual claim. For example, a claim with an invalid National Drug Code (NDC) will be denied with an edit. In contrast, audits review claim history: if the same claim is filed at two different pharmacies on the same day, for example, the claim at the second pharmacy will be denied with an audit.
Only payable claims that are not denied by an edit or audit are submitted to prospective DUR. Prospective DUR alerts inform providers of potential drug therapy problems. Providers can override any of these alerts.
Responding to DUR alerts is not considered a Pharmaceutical Care (PC) service. Not all PC services for which a provider receives a DUR alert are reimbursable under the PC benefit. Refer to Appendix 9 of this section for a description of minimum standards for submitting PC claims and to the "Pharmaceutical Care" chapter of this section for further PC information.
Pharmaceutical Care services can be billed through real-time POS or by using the paper non-compound drug claim form (PDF, 82 KB | Instructions — PDF, 31 KB) indicating PC codes in the three fields shared with DUR and the level of service field. Wisconsin Medicaid reminds providers that there are limitations on PC billing and reimbursement.
Retrospective DUR reviews are performed by Wisconsin Medicaid on a monthly basis. Review of drug claims against DUR Board-approved criteria generate patient profiles that are individually reviewed for clinical significance.
Each month, all Medicaid fee-for-service pharmacy claims are examined by a software program for potential adverse drug concerns. Among the problems reviewed are drug/drug interactions, overuse (early refill), drug/disease contraindication, duplicate therapy, high dose, and drug pregnancy contraindication.
If a potential drug problem is discovered, intervention letters are sent to all providers who ordered a drug relevant to the identified problem. Criteria are developed by Wisconsin Medicaid and are reviewed and approved by the DUR Board. An intervention consists of an informational letter to the prescriber, a response form for the prescriber to complete, a pre-addressed return envelope, and a patient drug profile.
On average, 2,200 intervention letters are sent each year. Intervention letters include a questionnaire about prescriber action. The average questionnaire response rate has been 67%, and approximately 75% of prescribers who respond to how useful the intervention was indicate it was useful or very useful.
The purpose of the recipient lock-in program (RLP) is to coordinate the provision of health care services for recipients who abuse or misuse Medicaid benefits by seeking duplicate or medically unnecessary services.
Coordination of recipient health care services is intended to:
With these goals in mind, ensuring necessary access to necessary Medicaid services remains a priority.
The Wisconsin Medicaid RLP focuses on the abuse/misuse of controlled substance medications. Abuse or misuse is defined under "Recipient Duties" in HFS 104.02, Wis. Admin. Code. These duties include:
Referrals of recipients as candidates for lock-in are received from retrospective DUR, physicians, pharmacists, other types of providers, and through automated surveillance methods. Once a referral is received, six months of pharmacy claims and diagnoses data are reviewed by a pharmacist. A recommendation for one of the following courses of action is then made:
Wisconsin Medicaid recipients who are candidates for enrollment in the RLP are sent a letter of intent, which explains the restriction that will be applied, how to designate a physician and a pharmacy, and how to request a hearing if they wish to contest the decision for enrollment. If recipients fail to designate providers, the RLP may assign providers based on claims' history. Recipients are also informed that access to emergency care is not restricted.
Upon enrollment and with changes in lock-in providers, letters of notification are sent to the recipient and to the lock-in physician and pharmacy. Recipients remain in the RLP for two years. The lock-in physician and pharmacy may make referrals for specialist care or for care that they are otherwise unable to provide (e.g., home infusion services). The recipient’s utilization of services is reviewed prior to release from the RLP and lock-in providers are notified of the effective date of the recipient’s release.
Refer to the Recipient Rights and Responsibilities section of the All-Provider Handbook for information on RLP and emergency services, change of provider, and due process.
Pharmacies designated as the lock-in pharmacy for enrolled recipients may fill prescriptions from any prescriber, including those from emergency care visits or referral physicians, as long as the prescription appears to be appropriate (e.g., it does not overlap with other prescriptions of the same drug class). For prescriptions for non-emergent care, the pharmacist may call the lock-in physician as identified in the most current letter of notification or the RLP to ascertain whether or not a referral is in place for the provider issuing the prescription.
A number of educational programs are generated by the DUR program. One of the primary means of education is the distribution of educational newsletters to prescribers and pharmacists. Topics for newsletters have included:
In addition, the intervention letters sent out generate additional calls to the DUR pharmacy staff that provide an opportunity for a one-to-one educational activity with the prescriber.
Under 1995 Wisconsin Act 27, the state biennial budget, Wisconsin Medicaid was required to develop an incentive-based pharmacy payment system that pays for Pharmaceutical Care (PC) services.
Pharmaceutical Care is a nationwide movement promoting a patient-centered, outcomes-oriented practice of pharmacy. Its purpose is to maximize the effectiveness of medications for the patient through intervention by the pharmacist.
Wisconsin Medicaid’s PC program provides pharmacists with an enhanced dispensing fee for PC services given to Wisconsin Medicaid fee-for-service recipients. This enhanced fee reimburses pharmacists for additional actions they take beyond the standard dispensing and counseling for a prescription drug.
For recipients enrolled in a Medicaid managed care program, each program develops its own policy regarding drug prices, dispensing fees, and whether to pay for PC services. Providers should contact the recipient’s managed care program for further information.
A PC profile must be created and maintained for the recipient prior to submitting a PC claim. It must include the intended use or diagnosis information for each drug the recipient is actively using. The source of information and level of confidence must be documented. To facilitate a more thorough understanding of the recipient’s medical condition(s), inclusion of the International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) codes for each diagnosis or intended use is recommended. Refer to Appendix 4 of this section for PC profile requirements.
The required, retrievable information for PC documentation can be found in Appendix 5 of this section. Providers may use any format to document PC, but that format must include all the elements in the model form provided in Appendix 5 of this section.
Valid ICD-9-CM codes are required on the drug claim for each PC intervention submitted. Providers must make a reasonable effort to report an ICD-9-CM code that identifies the medical condition most closely related to the PC intervention performed. This is generally the ICD-9-CM code associated with the drug dispensed as a result of the intervention.
The diagnosis and associated ICD-9-CM code should be determined and reported to the level of specificity the provider believes is necessary to perform the intervention. This could be three, four, or five digits. In some situations a general knowledge of the disease state(s) is necessary and in others a more precise determination is necessary to determine if an intervention is appropriate.
For example, knowledge of a general medical condition may be sufficient to determine that multiple non-steroidal anti-inflammatory drug use is probably not appropriate. However, in other situations the precise diagnosis must be known to determine if a specific drug’s dosage level is too high or too low.
Reimbursement for the PC dispensing fee requires the pharmacist to meet all basic requirements of federal and state law for dispensing a drug plus completing specified activities that result in a positive outcome both for the recipients and the Wisconsin Medicaid program. Some positive outcomes include increasing patient compliance or preventing potential adverse drug reactions.
Reimbursement is based on the following:
Appendices 6, 7, and 8 of this section provide tables showing allowed combinations of Reason, Action, and Result codes. Billing limitations for PC codes include the following:
Wisconsin Medicaid requires providers to bill their usual and customary charges for this service. Providers should maintain documentation of their usual and customary charges.
Professional PC intervention time includes the following:
The following situations are not included in the intervention time:
Only one PC dispensing fee is payable per date of service.
In most cases, payments using PC dispensing fees are limited to one, two, or four fees per year, per recipient, per pharmacy. See Appendix 8 of this section for specific limits.
The PC dispensing fee includes all pharmacy services reimbursement, except drug cost, for one dispensed or prescribed drug associated with the PC intervention.
There is no separate or additional reimbursement for compounding or dispensing the drug paired with the PC intervention on the drug claim.
Providers may submit claims for PC services as real-time claims or by using the non-compound drug claim form (PDF, 82 KB | Instructions — PDF, 31 KB) using PC codes in the three fields shared with drug utilization review (DUR). These codes follow National Council for Prescription Drug Program format. Claims for PC cannot be submitted through electronic media claims.
In real-time or paper claims submission, the provider should determine the total billing amount by adding together the usual and customary fee for the drug charge and the usual and customary fee for PC. (Level of service [LOS] is included in PC.)
Pharmaceutical Care claims submission requires an ICD-9-CM valid diagnosis code. If the diagnosis field is left blank, the PC claim will be denied.
To submit claims for PC:
Refer to the Claims Submission section of this handbook for further claims submission instructions.
If a drug is not dispensed, but a PC service is provided for a Medicaid-covered and payable drug, then the PC may be reimbursed. Submit the claim for the PC in the following way:
The Medicaid-specific PC codes may be submitted as a real-time claim if your software and switch vendor will allow it. If not, the claim can be submitted on the paper non-compound drug claim form (PDF, 82 KB | Instructions — PDF, 31 KB).
A Medicaid-payable drug will be paid even if the PC code is billed incorrectly. However, the traditional dispensing fee will not be substituted when the PC code is denied.
Responses to prospective DUR alerts will not necessarily qualify as PC services. Refer to Appendix 9 of this section for a description of minimum standards for billing PC. Services covered under the traditional Medicaid dispensing fee include record keeping, patient profile preparation, prospective DUR, and counseling.
Refer to the "Drug Utilization Review" chapter and Appendices 1, 2, and 3 of this section for information on the prospective DUR system, including billing codes and alert information.
Wisconsin Medicaid Pharmacy Handbook
July 2001