Download Part D Coverage for Drugs when the Beneficiary has Enrolled in

Part D Payment for Drugs for Beneficiaries Enrolled in Ho
Guidance
March 11, 2014
Summary at a Glance:
CMS has issued final guidance to Part D plans and hospices, providing clarifications abou
appropriate payment for drugs when the Medicare beneficiary has enrolled in hospice. Thi
describes the various components of the final guidance, supplemented by ongoing discuss
this issue.
On Monday, March 10, 2014 CMS issued final guidance to Part D Plan Sponsors and Med
Providers detailing the clarification of policy regarding the use of Part D with hospice patie
guidance is based on the feedback received by CMS from NHPCO, hospice and pharmacy
D plans and is intended to clarify the coverage responsibilities for Part D plans when a Par
enrolled in hospice. NHPCO submitted detailed comments on the draft guidance (PDF) an
ongoing discussions with Part D plans and with CMS about the many issues and concerns
providers.
Background
In 2012, the HHS Office of Inspector General (OIG) issued a report on the possible duplica
a limited number of types of drugs when a beneficiary has elected the hospice benefit, bas
payment for drugs related to the terminal diagnosis and related conditions which should ha
under the Medicare Part A hospice benefit. Follow up analysis with 2010 data conducted
CMS contractor, found that 14.9% of beneficiaries enrolled in hospice and Part D had som
through Part D, totaling $12.9 million. CMS commented that 10% of hospices (350) accoun
analgesic claims. Additionally, 50.3% of analgesic claims were for hospice beneficiaries re
facilities.
Coverage of Drugs and Biologicals under the Hospice Benefit
CMS states in the final guidance that “[t]he hospice plan of care must include all services n
palliation and management of the terminal illness and related conditions. As such, there m
medications that were used prior to the hospice election that will continue as part of the ho
and would be covered under the Medicare hospice benefit, if those drugs are necessary fo
management of the terminal illness and related conditions.”
Part D Coverage for Drugs when the Beneficiary has Enrolled in Hos
CMS states that in order for a drug to be covered by Part D after a beneficiary has elected
the drug must be for “treatment of a condition that is completely unrelated to the terminal il
conditions; in other words, the drug is unrelated to the terminal prognosis of the individual.
drugs covered under Part D for hospice patients would be under “unusual and exceptional
Prior Authorization Process
The Part D plan sponsors have been directed to place a beneficiary-level prior authorizati
ALL drugs for beneficiaries who have elected the Medicare Hospice Benefit to “determine
coverable under Part D.”
This means that the sponsor would “reject” all claims for drugs to be paid for under Part D,
have notification from the hospice, either prospectively or through the PA process, of the d
unrelated to the terminal illness or related conditions. Once the hospice or other prescriber
information on medications unrelated to the terminal illness and related conditions to the s
would then direct the pharmacy to pay the claim under Part D.
CMS has stated that it cannot currently require all sponsors to use a standardized PA form
a list of elements they would expect to request for oversight, and that could be used by spo
form. This list, which we would expect many sponsors to use as their PA form, is attached
guidance.
The process begins:
1. Part D sponsor receives a pharmacy claim for a beneficiary who has elected hospice an
with standardized reject coding.
2. The reject coding states “Hospice Provider- Request Prior Authorization for Part D Drug
Terminal Illness or Related Conditions” and gives the 24-hour pharmacy help desk p
with questions.
3. Pharmacy contacts the beneficiary or the prescriber (who may or may not be affiliated w
determine relatedness.
4. The prescriber may provide a verbal explanation regarding why the drug is unrelated to t
related conditions, or complete the PA form and submit it.
5. The pharmacy will bill the hospice for related medications, or the hospice may choose to
its usual pharmacy source. The pharmacy will bill Part D for unrelated medications,
related medications that are deemed to no longer be effective or have additional neg
symptoms. These related but no longer effective medications would not be covered
benefit, nor would they be covered under Part D. If the patient wishes to continue ta
medications, the hospice must discuss with the patient and family that the cost woul
the patient.
Prospective Hospice Initiated Prior Authorizations
Notice of Hospice Election: Hospices may prospectively initiate the PA process with the
sponsor when the patient initially elects the hospice benefit and before a claim has been s
proactive approach would alert the sponsor of a beneficiary’s hospice election, could spee
process, prevent having claims rejected upon submission at the pharmacy, and could help
and recoupment after claims have been paid erroneously by Part D.
Notice of Hospice Revocation or Discharge: The hospice provider also could proactive
or discharges to the sponsor so that the beneficiary’s Part D coverage can resume immed
Finding the Hospice Patient’s Part D Enrollment Information
Hospice providers can proactively identify a beneficiary’s Part D plan through the hospice
pharmacies can identify a beneficiary’s Part D plan by submitting a standard electronic elig
the CMS Transaction Facilitator. The query response identifies the plan sponsor and prov
online billing information as well as the pharmacy help desk phone number. The hospice c
communication or fulfill a PA through the sponsor’s 24-hour pharmacy help desk.
Prescribers
Unaffiliated with the Hospice
CMS describes the process that may occur when a beneficiary presents a prescription from
unaffiliated with the hospice, such as in the case of referring and attending physicians with
may have had a longstanding relationship for conditions unrelated to their hospice diagnos
some cases, such as when the prescriber is unaffiliated with the hospice provider and una
coordinate with the hospice provider to provide the required explanation for the PA, the sp
hospice for the explanation as to why the drug is unrelated to the terminal illness or related
do not necessarily expect the sponsor to be responsible for ensuring the PA is fulfilled. In
hospice provider can provide a verbal explanation to the sponsor regarding why the drug is
terminal illness or related conditions or complete the PA form with the explanation and sub
Attestation: CMS is also requiring these prescribers unaffiliated with the hospice to provi
why the drug is unrelated and to attest that they have coordinated with the hospice provid
hospice provider concurs with the unrelated nature of the drug.
Timelines for Response to a Prior Authorization Request
• 24 hour response time for expedited requests
• 72 hour response time for standard requests
The time-frame begins when the explanation of unrelatedness is received from the hospice
prescriber. These timelines are based on Section 30.2 of Chapter 18 of the Medicare Pres
Manual. CMS also notes that “a plan sponsor must not keep the request open indefinitely
Hospice
Formularies
CMS acknowledged that many hospices typically have a formulary that they frequently use
hospice can determine which drugs are listed on the formulary. However, if the drugs on t
providing the relief needed for the patient, then the hospice must provide an alternative…
providing a drug(s) not on the formulary. It should be noted that CMS “expects hospices
formulary drugs when they are necessary to meet the patient’s needs and desired o
Hospice Notice of Election
CMS reminds providers that the Notice of Election (CMS-1450) must be filed as soon as p
elects the hospice benefit. The NOE is the first step in the notification process for benefici
for Part D plan sponsors, and CMS states that timely filing of the NOE will help ensure app
drugs.
Contact Information for Hospice and Part D
Part D Plans will find hospice contact information: Part D plan sponsors will be identif
entries in Medicare Provider Enrollment, Chain and Ownership System (PECOS). Please
hospice’s data and contact information is correct in the PECOS system.
Hospices will find Part D Plan information: Hospice pharmacies can identify a benefici
submitting a standard electronic eligibility (E1) query to the CMS Transaction Facilitator. T
identifies the plan sponsor and provides the sponsor’s online billing information, as well as
desk telephone number. The hospice provider can initiate communication or fulfill a PA th
24-hour pharmacy help desk.
Reconciliation of Part D Payment
When Part D has paid for a drug that has been determined to be a hospice liability, CMS e
and the Part D plan sponsor to work together to solve payment responsibility issues and re
payments from the patient or patient’s family for drugs where the patient refused to try form
the drugs were determined by the hospice to be were unreasonable and unnecessary.
Effective Date
The effective date of this policy will be May 1, 2014, although some Part D plan sponsors h
implemented prior authorization processes for beneficiaries enrolled in hospice, following e
provided by CMS, and they are permitted to do so.
Implications for Beneficiaries
1. If there are drugs that the beneficiary requests that are related to the terminal diagnosis
has determined are not reasonable and necessary for the terminal illness and related cond
would be responsible for payment.
2. If the hospice does not provide such medications, it is not obligated to provide a Notice
coverage or ABN.
3. If the hospice provides the medication, even though it is not reasonable and necessary
ABN in order to charge the patient for the medication.
4. If the patient feels that the hospice should cover the cost of the drug, the patient may su
payment to Medicare and if denied, may file an appeal under the appeals process.
Final Note
NHPCO and CMS both acknowledge that this guidance doesn’t answer all questions. We
other stakeholders, including Part D plans and long term care pharmacies, and conversatio
ongoing.
For more details on implementing this new CMS policy, download the Compliance Tool: “I
Medicare Part D into the Hospice Admissions and Medication Management Process” (PDF
For questions, please contact [email protected].