ASCP criticizes CMS' 90-day claims window

December 4, 2008

The American Society of Consultant Pharmacists recently filed comments regarding implementation of the Medicare Improvements for Patients and Providers Act Section 172

The American Society of Consultant Pharmacists recently filed comments addressing implementation of the Medicare Improvements for Patients and Providers Act Section 172. The rules mandate a 90-day claims window under Medicare Part D for pharmacies serving long-term-care facilities.

In light of the complexity and time lags associated with establishing Medicaid eligibility and LIS status, ASCP urged the Centers for Medicare and Medicaid Services to take action to ensure that pharmacies serving long-term care facilities are not precluded from billing or receiving full payment under their contracts for drugs dispensed to dual eligibles. Owing to its focus on geriatric care, the association said, its members are intimately familiar with Medicare Part D, its impact on long-term-care pharmacies, and the patients the pharmacists serve.

According to the law, beginning contract year 2010, every contract between a plan sponsor and a long-term-care pharmacy must “provide that the long-term-care pharmacy must have not less than 30 days, or more than 90 days, to submit claims for reimbursement to the Part D plan sponsor.” ASCP said there are issues with the time frame.

“The 90-day claims window is extremely problematic in light of the following: (1) the time frame for processing Medicaid applications is often longer than 90 days (2) Medicaid eligibility determinations have retroactive effect, and (3) there are documented time lags associated with state eligibility databases, as well as time lags associated with CMS’ ability to report accurately beneficiaries’ low-income subsidy (LIS) status to plan sponsors,” the association’s comment letter said.

The association added that, under Medicare Part D, CMS is responsible for notifying the plans of enrollees’ eligibility for the subsidy and the level of the subsidy. “Unfortunately, many full-subsidy-eligible enrollees, including many nursing home residents, have been denied the benefit of the subsidies available to the plans because CMS’ database is neither accurate nor up to date.”

CMS has determined the problem is systemic and results from various time lags associated with reporting the data and the fact that Medicaid eligibility is often effective on a retroactive basis. Lacking the CMS data, plan sponsors have been incorrectly charging co-payments to subsidy-eligible individuals.

In many cases, unless the pharmacy is willing to dispense the medication without assurance of full payment, these beneficiaries must either pay the co-payments or leave the pharmacy without necessary medications.

Prior to implementation of Part D, when long-term-care pharmacies billed state Medicaid programs for drug claims, the claims payment window in most states remained open for a year or even longer. “Extending the Medicaid claims window ensured that long-term care pharmacies eventually would be reimbursed in full for drugs dispensed to Medicaid beneficiaries.

"In contrast, Medicare Part D sponsors adopted commercial contracting standards that generally require that pharmacy claims be submitted no later than 90 days from the date of dispensing,” the association said.