Specialty The New Frontier. Craig S. Stern, PharmD., MBA, FMCP, CSP President Pro Pharma Pharmaceutical Consultants, Inc. September 19, 2015
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1 Specialty The New Frontier Craig S. Stern, PharmD., MBA, FMCP, CSP President Pro Pharma Pharmaceutical Consultants, Inc. September 19, 2015
2 Attendance Code (Please leave blank)
3 Disclosure Craig Stern reports having no financial relationships with any commercial interests during the past 12 months.
4 COURSE DESCRIPTION This session will describe today s opportunities and challenges with Ambulatory Pharmacy entering the Specialty Medication Market. Pharmacists will be called upon to provide expertise, management and education to mark their role in this opportunity. Of particular importance is the role of utilization and management of Specialty Pharmaceuticals.
5 OUTLINE I. Introduction and Definitions II. Provider Competition III. Medical vs. Pharmacy Coding IV. Claims Submission Requirements V. Management Approaches VI. The Future & Opportunities
6 DEFINITIONS OF SPECIALTY Rx Definitions All Injectable Medications Self-Administered (usually Pharmacy) Provider Administered (usually Medical) Facility Administered (includes Acute Care Hospital, SNF, LTC) Medicare Part B covered includes enteral feeding (EN), HIV/AIDS medications, diagnostics Medication cost / dose >= $500 Limitations Miscellaneous Coding ( noc codes) Administrative Fees Disposable Medical Equipment (DME) Radio-Labeled Medications
7 SPECIALTY PHARMACY PROVIDERS Medical Sub-Channels Ambulatory Clinics Emergency Medicine Home Care Infusion Centers Inpatient Hospital Outpatient Hospital Physician s Office Surgery Centers Pharmacy Sub-Channels PBMs Retail Pharmacy Network Specialty Pharmacies
8 HOW DOES MEDICAL BILLING DIFFER FROM PHARMACY BILLING? PHARMACY BILLING Expect drug/strength Expect quantity Expect days supply Expect prescriber ID Assume ambulatory LOS As a consequence claims require: NDC Quantity in packages Days supply for prescription Prescriber NPI MEDICAL BILLING J Code Dose vs. Dispensed Date Range often missing Prescriber ID = taxid, NPI, etc. LOS is variable As a consequence, note that: Many-2-Many NDC / J Code Quantity / J Code unit Date of service only Prescriber has many IDs LOS = POV, EM, Hosp, Clinic, etc.
9 HCPCS CODES Level I -- CPT Author: CMS Includes: DMEPOS, ambulance, supplies, Rx, dental procedures, outpatient prospective payment system (OPPS) CPT-4 codes for hospital providers Quality Data Codes: preventive vs. diagnostic or therapeutic HCPCS Modifiers: service/procedure altered by specific circumstances Level II -- HCPCS Author AMA Includes: services & supplies Codes for hospitals, physicians, and other health professionals who bill Medicare A-codes: ambulance, radio-rx C-codes G-codes J-codes Q-codes S-codes
10 CLAIMS SUBMISSION ISSUES: Bill Review Considerations Quantity matches quantity approved, data sources, HCPCS unit, package unit Quantity submitted greater than vial size Submitted price > package price Rules for pending claims: Require J-Code, NDC, Drug Name, Strength, Quantity Miscellaneous Codes J3490, J3590, J9999 required information
11 PRICING OPTIONS AWP / SWP National Pricing Standards AAC, NADAC ASP Specialty MAC Vendor Pricing Options WAC / DP
12 MANAGEMENT APPROACHES
13 GENERAL MANAGEMENT APPROACHES Plan Design Considerations Formularies Tiered Design / Value-Priced Tiers Step Therapy Therapeutic Category Restrictions / Therapeutic Substitution Mandatory Substitution Biosimilars Biobetters Hybrid Models Network Management Location of Service Optimization Oversight of Bounty Hunters Revenue Enhancement Up-Coding NOC Coding Spend Management COGS / Formularies Pricing Formulae Reference Pricing Rebates Generic vs. Therapeutic Trend Management Cost Utilization New Entrants Contracting Adherence Contracts Discontinuance Rate Limitations
14 UTILIZATION MANAGEMENT APPROACHES Utilization Management Restriction Techniques First Fill: 1-2 week supply & Refill Limits Quantity Limits and High Dosage Limitations Specialist Only Spread Treatment over Multiple Years Cost Shifting Pharmacy vs. Medical Coverage Tests Part B vs D Coverage Tests Clinical Management Genotyping Side Effect Profiling Scatter Approaches Lowest Cost Alternatives Price Differential by Dose Choice Management, e.g., Lower Medical Waiver Probability
15 CLINICAL ASSESSMENT: MEDICAL / PHARMACY The following summaries illustrate potential clinical problems addressed in each channel The relative magnitude of each problem is estimated by the PMPM Pharmacy Clinical Assessment Paid per Utilizer per PMPM Category Month Drug Interactions between JCode and Pharmacy Claims $4, $0.08 Specialty Drug Adherence and Holiday $1, $1.66 Specialty Drug Induced Disease and Adverse Events $36, $8.53 Medical Clinical Assessment Category Paid per Utilizer per Month PMPM Drug Interactions between JCode and Pharmacy Claims $1, $0.04 Specialty Drug Adherence and Holiday $1, $1.44 Specialty Drug Induced Disease and Adverse Events $11, $1.74
16 FUTURE & OPPORTUNITIES
17 CHANNEL COMPETITION Medical Sub-Channels Sub-Channel Competition: POV vs. Infusion Center vs. Hospital Outpatient vs. Acute Care Best-in-Class Centers of Excellence Pricing Competition 340b National Bases of Cost (ASP, NADAC) Pharmacy Sub-Channels Access Service Price
18 INFORMATION SUPERMARKET Standardization Biosimilar Naming and Coding Metric standardization and publication Uniform Coding Implementation RxNorm Unified Medical Language System (UMLS) Does not change with NDC EMRs can talk to each other SnoMed Laboratory Data standardized Standardization Information market for Specialty Prices State Medicaid MACs ASP NADAC / AAC Quality Performance across channels Information sharing across ACOs Data sharing across Providers
19 REFERENCES
20 DATA VENDORS VENDOR FEATURES First Data Bank HCPCS Select Medi-Span / Wolters Kluwer Manufacturers Noridian Admin Services NovoLogix J Code Calculator / Pro Pharma JR Red Book / Truven NDC/HCPCS, pricing link - WAC/SWP/ASP/PAL, Part B All HCPCS values, map to NDC/UPC/HRI, Qty map Lists of NDCs and HCPCS Codes NDC/HCPCS crosswalk NDC/HCPCS crosswalk NDC/HCPCS crosswalk, Unit/Package calc., AWP/WAC/ASP, Brand/Generic, Part B/D, Qty map, Usage Map NDC, HCFA J-Codes, AWP/WAC, Brand/Generic
21 PRO PHARMA PHARMACEUTICAL CONSULTANTS, INC. P.O. Box Northridge, CA (818) (818) Fax Visit our website at: Make sure to follow, like and subscribe!
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