April 3, 2009, Directive Memorandum for Pricing Future Prescription Drugs in Medicare Set-Asides
http://www.cms.hhs.gov/WorkersCompAgencyServices/Downloads/April2009WC [...]
http://www.bwhllc.com/law/medicare/online_referral.php
At long, long last, The Centers for Medicare and Medicaid Services has issued a Directive Memorandum with regard to procedures for the methodology of pricing future prescription drugs in Medicare Set-Asides.
The CMS Memorandum of April 3, 2009 can be accessed by following the first link above.
In its Memorandum, The CMS indicates that it will begin independent review of prescription medications for all Workers' Compensation Medicare Set-Aside (WCMSA) proposals received on or after June 1, 2009, and that independent pricing of prescription drugs will be calculated and priced using average wholesale pricing (AWP). According to the Memorandum, "The CMS will not use or recognize any other pricing, discounting, or calculation methods when determining the adequacy of the prescription drug amounts in WCMSA proposals."
With regard to generic pricing, Medicare's Directive Memorandum indicates that Generic pricing is acceptable if there is a Generic that is available. If there is no Generic currently available, CMS will default to the AWP pricing for brand name drugs in determining the adequacy of the prescription drug amount.
Medicare has included a chart for Prescription Drug Data Elements, which specifies how to allocate prescription drugs for Medicare's review. The chart indicates that the following information should be provided:
Drug Name
National Drug Code
Unit Form (Capsule, Tablet, Patch, etc.)
Prescribed Strength (mg, mcg, etc.)
Price Per Unit (do not round above 4 decimal places. For example, do not use $0.76 for $0.7550).
While this Memorandum addresses which pricing methodology to use when allocating and how to incorporate Generics, the Memorandum is silent on the frequency of prescription drug allocating with regard to tapering, weaning or discontinuing the use of medications throughout the course of a Claimant's life expectancy. The Memorandum also does not address off-label use, and how to allocate when prescriptions are prescribed for a purpose outside the scope of a drug's approved label.
Please be advised that Medicare's independent pricing implementation date of June 1, 2009 will apply to the following:
1. New WCMSA proposals received by Medicare on or after June 1, 2009
2. Closed WCMSA proposals that reopen on or after June 1, 2009
It is important to note that Medicare considers closed cases to reopen upon The Coordination of Benefits Contractor's receipt of previously requested documentation. For example, if a case submitted to Medicare in 2008 was closed because Medicare was waiting for updated medical records, and those requested documents are not received by Medicare until on or after June 1, 2009, Medicare will consider this a new WCMSA submission and independent review of prescription drugs using AWP will apply.
Burns White has utilized Average Wholesale Pricing in its Medicare Set-Aside Allocations since the Medicare Prescription Drug Bill took effect on January 1, 2006. Our Attorneys anticipated years ago that Medicare would not accept other pricing methodologies, such as the Co-Pays and Deductibles/"Donut hole" methodologies, and we have always advised our clients against using such pricing practices. Also, Burns White has never allocated for generic forms of prescription drugs that had not yet been approved as generic, as is also a common practice of other MSA providers. As such, Medicare Set-Asides prepared by Burns White that are awaiting Medicare submission are not likely to require revisions based solely on the new prescription pricing guidelines, although Medicare's independent pricing review program is considered "unchartered territory," and future Medicare prescription reviews may demonstrate that Medicare has taken a position on tapering/weaning/discontinuing of prescription drugs, despite the lack of a published policy.
Medicare Set-Asides prepared by other MSA providers may require serious revisions, which might affect your total settlement value and/or your ability to successfully settle some claims. In an effort to assist you with submission for MSAs previously prepared that are inconsistent with Medicare's new independent pricing methodologies, we would like to offer our prompt and accurate revision services. Even if Burns White did not prepare the original MSA, it is not too late to get us involved. We offer expedited service, and MSA revisions can be made in three (3) business days or less.
If you would like to have an MSA reviewed by Burns White, please contact Bruce McKnight, our Medicare Marketing Director/Client Services Manager at (412) 995-3247 or bemcknight@burnswhite.com. Or make an online referral on our website by following the link to: http://www.bwhllc.com/law/medicare/online_referral.php
http://www.bwhllc.com/law/medicare/online_referral.php
At long, long last, The Centers for Medicare and Medicaid Services has issued a Directive Memorandum with regard to procedures for the methodology of pricing future prescription drugs in Medicare Set-Asides.
The CMS Memorandum of April 3, 2009 can be accessed by following the first link above.
In its Memorandum, The CMS indicates that it will begin independent review of prescription medications for all Workers' Compensation Medicare Set-Aside (WCMSA) proposals received on or after June 1, 2009, and that independent pricing of prescription drugs will be calculated and priced using average wholesale pricing (AWP). According to the Memorandum, "The CMS will not use or recognize any other pricing, discounting, or calculation methods when determining the adequacy of the prescription drug amounts in WCMSA proposals."
With regard to generic pricing, Medicare's Directive Memorandum indicates that Generic pricing is acceptable if there is a Generic that is available. If there is no Generic currently available, CMS will default to the AWP pricing for brand name drugs in determining the adequacy of the prescription drug amount.
Medicare has included a chart for Prescription Drug Data Elements, which specifies how to allocate prescription drugs for Medicare's review. The chart indicates that the following information should be provided:
Drug Name
National Drug Code
Unit Form (Capsule, Tablet, Patch, etc.)
Prescribed Strength (mg, mcg, etc.)
Price Per Unit (do not round above 4 decimal places. For example, do not use $0.76 for $0.7550).
While this Memorandum addresses which pricing methodology to use when allocating and how to incorporate Generics, the Memorandum is silent on the frequency of prescription drug allocating with regard to tapering, weaning or discontinuing the use of medications throughout the course of a Claimant's life expectancy. The Memorandum also does not address off-label use, and how to allocate when prescriptions are prescribed for a purpose outside the scope of a drug's approved label.
Please be advised that Medicare's independent pricing implementation date of June 1, 2009 will apply to the following:
1. New WCMSA proposals received by Medicare on or after June 1, 2009
2. Closed WCMSA proposals that reopen on or after June 1, 2009
It is important to note that Medicare considers closed cases to reopen upon The Coordination of Benefits Contractor's receipt of previously requested documentation. For example, if a case submitted to Medicare in 2008 was closed because Medicare was waiting for updated medical records, and those requested documents are not received by Medicare until on or after June 1, 2009, Medicare will consider this a new WCMSA submission and independent review of prescription drugs using AWP will apply.
Burns White has utilized Average Wholesale Pricing in its Medicare Set-Aside Allocations since the Medicare Prescription Drug Bill took effect on January 1, 2006. Our Attorneys anticipated years ago that Medicare would not accept other pricing methodologies, such as the Co-Pays and Deductibles/"Donut hole" methodologies, and we have always advised our clients against using such pricing practices. Also, Burns White has never allocated for generic forms of prescription drugs that had not yet been approved as generic, as is also a common practice of other MSA providers. As such, Medicare Set-Asides prepared by Burns White that are awaiting Medicare submission are not likely to require revisions based solely on the new prescription pricing guidelines, although Medicare's independent pricing review program is considered "unchartered territory," and future Medicare prescription reviews may demonstrate that Medicare has taken a position on tapering/weaning/discontinuing of prescription drugs, despite the lack of a published policy.
Medicare Set-Asides prepared by other MSA providers may require serious revisions, which might affect your total settlement value and/or your ability to successfully settle some claims. In an effort to assist you with submission for MSAs previously prepared that are inconsistent with Medicare's new independent pricing methodologies, we would like to offer our prompt and accurate revision services. Even if Burns White did not prepare the original MSA, it is not too late to get us involved. We offer expedited service, and MSA revisions can be made in three (3) business days or less.
If you would like to have an MSA reviewed by Burns White, please contact Bruce McKnight, our Medicare Marketing Director/Client Services Manager at (412) 995-3247 or bemcknight@burnswhite.com. Or make an online referral on our website by following the link to: http://www.bwhllc.com/law/medicare/online_referral.php
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