APPENDIX B: VENDOR DRUG PROGRAM TEXAS MEDICAID PROVIDER PROCEDURES MANUAL: VOL. 1

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1 APPENDIX B: VENDOR DRUG PROGRAM TEXAS MEDICAID PROVIDER PROCEDURES MANUAL: VOL. 1 AUGUST 2015

2 TEXAS MEDICAID PROVIDER PROCEDURES MANUAL: VOL. 1 AUGUST 2015 APPENDIX B: VENDOR DRUG PROGRAM Table of Contents B.1 Vendor Drug Program B.1.1 VDP Benefits for Medicaid Fee-for-Service (FFS) Clients B.1.2 VDP Formulary Information B.1.3 Obtaining Outpatient Prescribed Drug Prior Authorization for FFS Clients B.1.4 Dispensing Life of Prescriptions B.1.5 National Drug Code (NDC) B.1.6 VDP Contact Information B Hour Emergency Supply B.1.8 Cost Avoidance Coordination of Benefits B.1.9 Schedule II Controlled Substances (CII) through Schedule V Controlled Substances (CV) B.1.10 Requirements for Early Refills of Certain Drugs B.1.11 Free Delivery of Medicaid Prescriptions for FFS Clients B.1.12 Delivery of Medicaid Prescriptions for MCO Clients B.1.13 Pharmacies Can Dispense Limited Home Health Supplies (LHHS) to Medicaid Clients B.1.14 Vitamin and Mineral Products B.2 Medicaid Children s Services Comprehensive Care Program (CCP) Available for Children and Adolescents B.3 Palivizumab (Synagis) Available Through the VDP B.3.1 Participating Palivizumab Distribution Pharmacies

3 B.1 Vendor Drug Program The Texas Medicaid Vendor Drug Program (VDP) makes payment for prescriptions of covered outpatient drugs to those pharmacy providers contracted with the VDP. In-state pharmacies licensed as Class A or C by the Texas State Board of Pharmacy are eligible for enrollment in the VDP. Out-of-state pharmacies and pharmacies holding any other class of pharmacy license are considered for inclusion in the program on a case-by-case basis, relative to the benefits made available to a client eligible for Texas Medicaid. Contracts are not granted to applicants unless additional benefits to the recipient are established. VDP provides statewide access to prescription drugs as prescribed by treating physician or other healthcare provider for clients eligible for: Medicaid fee-for-service Children with Special Health Care Needs (CSHCN) Services Program Kidney Health Care (KHC) VDP manages drug formulary for Children s Health Insurance Program (CHIP). VDP remains responsible as claims processor for Medicaid fee-for-service (FFS) clients and management of Medicaid drug formulary and preferred drug list. Note: Refer to: Pharmacy services rendered to Medicaid managed care clients are administered by the clients managed care organizations (MCOs). Medicaid Managed Care Handbook (Vol. 2, Provider Handbooks) for additional information about managed care prescription drug and pharmacy benefits. B.1.1 VDP Benefits for Medicaid Fee-for-Service (FFS) Clients The Medicaid drug benefit for Medicaid FFS clients is limited to three prescriptions per month with the following exceptions that have unlimited prescriptions: Clients enrolled in waiver programs such as Community Living Assistance (CLASS) and Community-Based Alternatives (CBA) Texas Health Steps (THSteps)-eligible clients (clients who are 20 years of age and younger) Clients in skilled nursing facilities Note: Prescriptions for family planning drugs and supplies are not subject to the three-prescription limit. The following categories of drugs do not count against the three prescription per month limit: Family planning drugs Smoking cessation drugs Insulin syringes FFS clients can be locked-in to a specific pharmacy. FFS clients who are locked-in to a primary care pharmacy have Lock-in printed on their Your Texas Benefits Medicaid card. Clients who are not locked-in to a specific pharmacy may obtain their drugs or supplies from any contracted Medicaid provider of pharmaceutical services. Refer to: Subsection 4.4.2, Client Lock-in Program in Section 4, Client Eligibility (Vol. 1, General Information) for more information about lock-in limitations. 3

4 Family planning services are excluded from lock-in limitation. Though TMHP reimburses family planning agencies and physicians for family planning drugs and supplies, the following family planning drugs and supplies are also available through the VDP and are not subject to the three-prescription limit: Oral contraceptives Long-acting injectable contraceptives Vaginal ring Hormone patch Certain drugs used to treat sexually transmitted diseases (STDs) Refer to: The VDP website at for more information. The VDP does not reimburse claims for nutritional products (enteral or parenteral), medical supplies, or equipment other than limited home health supplies (LHHS). B.1.2 VDP Formulary Information VDP drug formulary information is available to health-care providers to help their clients efficiently get their medications. Information includes which state health-care program covers the drug, whether a drug is on the Medicaid Preferred Drug List (PDL), whether a Medicaid non-preferred prior authorization or clinical prior authorization is required, and other important drug information. VDP drug formulary information is available: Online at (All state health-care program formulary information with prior authorization type (PDL or clinical) required indicator) Online at Here providers can find Medicaid drug formulary and PDL information with links attached to selected non-preferred drugs that will guide providers to the preferred drugs in that therapeutic class. Providers are eligible to register for Epocrates, which is a free drug information service that can be downloaded to the provider s mobile device. In addition to listing a drug s preferred status, Epocrates includes drug monographs, dosing information, and warnings. For more information, go to B.1.3 Obtaining Outpatient Prescribed Drug Prior Authorization for FFS Clients To obtain prior authorization for any VDP medication for FFS clients, prescribing providers or their representatives should call the Texas Prior Authorization Hotline at PA-TEXAS ( ). The Hotline is available Monday through Friday, 7:30 a.m. to 6:30 p.m. Central Time. To submit an online VDP prior authorization request for non-preferred drugs, prescribing providers must first register online at https://paxpress.txpa.hidinc.com. For Synagis prior authorization, see subsection B.3, Palivizumab (Synagis) Available Through the VDP in this appendix. Note: Pharmacists cannot obtain prior authorization for medications. If the client arrives at the pharmacy without prior authorization for a non-preferred drug, the pharmacist will alert the provider s office and ask the provider to get prior authorization. B.1.4 Dispensing Life of Prescriptions Medicaid prescriptions for noncontrolled substances are valid one year and up to 11 refills if authorized by prescriber. Medicaid prescriptions for controlled substances in drug classes C3-C5 are valid for six months and up to 5 refills if authorized by prescriber provider. 4

5 Medicaid prescriptions controlled substances in C2 drug class have no refills and must be dispensed within 21 days of the date on which the prescription was written. Refer to: VDP Pharmacy Provider Procedure Manual at txvendordrug.com/downloads/index.asp. Texas State Board of Pharmacy website at rules about issuance of identical sets of C2 prescriptions. B.1.5 National Drug Code (NDC) All Texas Medicaid providers must submit a rebateable NDC for professional or outpatient claims submitted to TMHP with a physician-administered prescription drug procedure code. The NDC is an 11-digit number on the package or container from which the medication is administered. Providers must enter modifier N4 before the NDC code. The NDC unit and the NDC unit of measure must be entered on all professional or outpatient claims that are submitted to TMHP. Note: Procedure codes in the A-code series do not require an NDC on claims that are submitted to TMHP. A list of drugs that require an NDC for Texas Medicaid reimbursement is available on the TMHP website at under the Topics section. Physician-administered drugs that do not have a rebateable NDC will not be reimbursed by Texas Medicaid. Refer to: Subsection 6.3.4, National Drug Code (NDC) in Section 6, Claims Filing (Vol. 1, General Information) for additional information on claims filing using NDC. B.1.6 VDP Contact Information Vendor Drug Area Telephone Number Covered outpatient drugs and billing: The 800 number is for pharmacy use only and can be used to reach anyone in the VDP. Pharmacy contracts Program management Policy Field administration Drug formulary (Texas listing of national drug codes) Texas Prior Authorization Center Hotline B Hour Emergency Supply Federal and Texas law requires that a 72-hour emergency supply of a prescribed drug be provided when a medication is needed without delay and prior authorization is not available. This rule applies to nonpreferred drugs on the Preferred Drug List (PDL) and any drug that is affected by a clinical prior authorization edit and needs the prescriber s prior approval. Some preferred drugs on the Medicaid formulary may also be subject to clinical edits that require additional prior authorization. Drugs not on the PDL may also be subject to clinical edits. Refer to: VDP website at B.1.8 Cost Avoidance Coordination of Benefits Cost avoidance coordination of benefits (COB) for pharmacy claims ensures compliance with the Centers for Medicare & Medicaid Services (CMS) regulations. Under federal rules, Medicaid agencies must be the payer of last resort. The cost avoidance model checks for other known insurance at the point of sale, preventing Medicaid from paying a claim until the pharmacy attempts to obtain payment from the client s third party insurance. Refer to: VDP Pharmacy Provider Procedure Manual at txvendordrug.com/downloads/index.asp. 5

6 B.1.9 Schedule II Controlled Substances (CII) through Schedule V Controlled Substances (CV) Pharmacies must report all CIII, CIV, and CV prescriptions to the Texas Department of Public Safety (DPS) in addition to the CII prescriptions that are already being reported. This DPS process requires reporting by the DPS registration number of the practitioner issuing the prescription. The prescription forms for Schedule CII controlled substances that are issued by the Texas Department of Public Safety (DPS) under the Texas Prescription Program meet the baseline standards set forth above. Refer to: The DPS website at Tamper-Resistant Prescription Pads Providers are required by federal law (Public Law ) to use a tamper-resistant prescription pad when writing a prescription for any drug for Medicaid clients. Pharmacies are required to ensure that all written Medicaid prescriptions submitted for payment to the VDP were written on a compliant tamper resistant pad. CMS has stated that special copy-resistant paper is not a requirement for electronic medical records (EMRs) or eprescribing-generated prescriptions. These prescriptions may be printed on plain paper and will be fully compliant if they contain at least one feature from each of the following three categories: Prevents unauthorized copying of completed or blank prescription forms Prevents erasure or modification of information written on the prescription form Prevents the use of counterfeit prescription forms Two features that can be incorporated into computer-generated prescriptions printed on plain paper to prevent passing a copied prescription as an original prescription are as follows: Use a very small font that is readable when viewed at 5x magnification or greater and illegible when copied. Use a void pantograph accompanied by a reverse Rx, which causes a word such as Void to appear when the prescription is photocopied. Refer to: VDP Pharmacy Provider Procedure Manual at txvendordrug.com/downloads/index.asp. B.1.10 Requirements for Early Refills of Certain Drugs Medicaid fee-for-service and the Children with Special Health Care Needs (CSHCN) Services Program clients must exhaust 90 percent of the prescribed of certain controlled substances, including tramadol, before a Medicaid Vendor Drug Program (VDP)- enrolled pharmacy may refill a prescription or fill a new prescription for the same drug. Note: Some drugs, such as attention deficit hyperactivity disorder drugs and certain seizure medications, are excluded from this change. The 90% Utilization Drug List, which contains a complete list of the affected drugs, is available in the Downloads section of the VDP website at Justifications for early refills include, but are not limited to, the following: A verifiable dosage increase An anticipated prolonged absence from the state 6

7 If a client requests an early refill of a drug on the VDP list, the dispensing pharmacy must contact the VDP Pharmacy Resolution help desk to request an override of the early refill restriction. Prescribing providers may be asked to verify the reason for the early refill by the dispensing pharmacy or VDP staff. Note: Providers who are members of Medicaid managed care plans should contact the appropriate managed care organization (MCO) and/or Pharmacy Benefit Manager for specific requirements and processes related to dispensing early refills. B.1.11 Free Delivery of Medicaid Prescriptions for FFS Clients Many Medicaid pharmacies across the state offer free delivery of prescriptions to Medicaid FFS clients. To find out which pharmacies offer home delivery, refer FFS clients to the HHSC website at Contracted Medicaid pharmacy providers are reimbursed a delivery fee that is included in the medication dispensing fee formula. The delivery fee is paid to HHSCapproved pharmacy providers that have certified that delivery services meet minimum conditions for payment of the delivery fee. The conditions include: Making deliveries to individuals rather than to institutions, such as nursing homes. Offering no-charge prescription delivery to all Medicaid clients who request it in the same manner as to the general public. Displaying publicly the availability of prescription delivery services at no charge in a prominent place in the pharmacy store (window or door). Providing the delivery service without requiring retention of the Your Texas Benefits Medicaid card. This delivery fee is not applicable for mail-order prescriptions. For more information, call the Vendor Drug Resolution Help Desk at and ask for Pharmacy Contracts. B.1.12 Delivery of Medicaid Prescriptions for MCO Clients Medicaid and CHIP MCOs pay local pharmacies to deliver pharmaceuticals to clients. Each MCO develops its own participating pharmacy network for this delivery service. Pharmacies that are interested in receiving payment for the delivery of pharmaceuticals to MCO clients should contact their MCOs to request information on how to apply. The VDP website at has several managed care expansion resources for pharmacies. The Enrollment Chart at includes the pharmacy contract telephone number for each MCO. B.1.13 Pharmacies Can Dispense Limited Home Health Supplies (LHHS) to Medicaid Clients Pharmacies that are enrolled with VDP can dispense LHHS that are commonly found in a pharmacy to fee-for-service Medicaid clients. Pharmacies can also dispense LHHS to clients who are enrolled in a Medicaid MCO if the pharmacy is enrolled in the client s MCO. The home health supplies that can be dispensed include the following: Diabetic insulin syringe with needle 1 cc or less Diabetic insulin needles Diabetic blood glucose test strips Diabetic lancets Spring-powered device for lancet 7

8 Home glucose disposable monitor (includes test strips) Talking diabetic blood glucose monitors Aerosol holding chamber Oral electrolytes Hypertonic saline solution Claims are subject to post-payment desk reviews to ensure claims from durable medical equipment (DME) providers and pharmacies do not result in either a client who exceeds the maximum quantity or a duplicate payment from HHSC for the same client and LHHS. More information about the provision of these supplies through a fee-for-service pharmacy can be found on the VDP website at Providers should contact the appropriate MCO or pharmacy benefit manager for more information about providing these supplies to Medicaid clients who are enrolled in a Medicaid managed care plan. B.1.14 Vitamin and Mineral Products Pharmacies that are contracted with VDP can dispense some vitamin and mineral products to Texas Medicaid fee-for-service clients who are 20 years of age and younger. Pharmacies can also dispense these covered vitamin and minerals products to clients who are enrolled in a Medicaid MCO, if the pharmacy is enrolled in client s MCO. VDP-contracted pharmacies can honor a physician s prescription for covered vitamins and minerals. To help expedite pharmacy claim processing, prescribing providers are encouraged to include the diagnosis on the prescription. VDP-contracted pharmacies are required to be enrolled with TMHP or have a CCP Prior Authorization Request Form to fill a prescription unless they intend to submit claims to TMHP instead of VDP. VDP-contracted pharmacies that are not enrolled with TMHP may submit claims for vitamin or mineral products to VDP. Claims are subject to post-payment desk reviews to ensure claims from DME providers and pharmacies do not result in duplicate payments for the same client or vitamin and mineral and to validate that prescribed products are appropriate for the client s medical condition. More information about the provision of these products and list of products for fee-for-service clients can be found on the VDP website at B.2 Medicaid Children s Services Comprehensive Care Program (CCP) Available for Children and Adolescents Medically necessary drugs and supplies that are not covered by the VDP may be available to children and adolescents (birth through 20 years of age) through the CCP (i.e., some over the counter drugs, nutritional products, diapers, and disposable or expendable medical supplies). The Prior Authorization fax number is Refer to: Subsection , Pharmacies (CCP) in the Children s Services Handbook (Vol. 2, Provider Handbooks) for more information about pharmacy enrollment in CCP. B.3 Palivizumab (Synagis) Available Through the VDP Palivizumab is available to physicians for administering to Medicaid clients only through the VDP. This option enables physicians to have palivizumab shipped directly to their office from a network pharmacy. Physicians will not need to purchase the drug. Physicians who obtain palivizumab through the VDP may not submit claims to Medicaid (TMHP) for the drug. 8

9 The administering provider may submit a claim to TMHP for an injection administration fee and any medically necessary office-based evaluation and management service provided at time of injection. For more information, refer to the HHSC Vendor Drug Synagis Program page at B.3.1 Participating Palivizumab Distribution Pharmacies For a list of participating pharmacies, refer to the HHSC Vendor Drug website at Palivizumab forms are updated every year. Providers must use the most current version of the forms to submit prior authorization requests. The Texas Medicaid/CHIP Vendor Drug Program Fee-For-Service Medicaid Synagis Request Form for Season is required when the prescribing provider obtains the drug through VDP. Note: Refer to: Palivizumab is also be available to Children with Special Health Care Needs (CSHCN) Services Program clients. Providers can refer to the CSHCN Services Program Provider Manual for details. Texas Medicaid/CHIP Vendor Drug Program Fee-For-Service Medicaid Synagis Request Form on the VDP website. 9

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