MEDICARE PART D POLICY FORMULARY: TRANSITION PROCESS Policy Number: 6-C
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1 MEDICARE PART D POLICY FORMULARY: TRANSITION PROCESS Policy Number: 6-C Coverage Statement This Policy is applicable to: Medco PDP, Beneficiaries, Enhanced PDPs, Client PDPs and Client MA-PDs, to the extent covered under the Medco client agreement. Purpose This document outlines Medco s Transition Process that provides continued drug coverage to new and current enrollees. Definitions Maximum Daily Dose: The Maximum dosage recommended by manufacturer to be dispensed to a patient per day. Part D plan: (or Medicare Part D plan): means a prescription drug plan, an MA-PD plan, a PACE Plan offering qualified prescription drug coverage, or a cost plan offering qualified prescription drug coverage. Prescription Drug Plan: means prescription drug coverage that is offered under a policy, contract, or plan that has been approved and that is offered by a PDP sponsor that has a contract with CMS that meets the contract requirements. Quantity Level Limit: A benefit design option that identifies the unit or prepackaged quantity for a specific drug that will be covered with one co-payment or per prescription or claim. Quantity limit applies a limit at the drug-specific level and is frequently employed to support appropriate drug use and to reduce client costs by increasing the member cost share. Quantity limits are often applied to inhalers, injectables, patches, and other pre-packaged units, and to medications that are prescribed on an asneeded basis such as migraine therapy. Transition Period: The 90 day period following the initial effective date of enrollment in the Plan Sponsor s Part D plan. Transition Process: A Part D plan s process, policy, and procedure that meet CMS standards requiring temporary coverage of certain drugs during the transition phase of a member s benefit coverage. Transition Supply: Temporary supply of non-formulary Part D drugs provided during the Transition Process to applicable members. Transition Supply also includes covered formulary Part D drugs that require prior authorization, quantity limit, or step therapy under Medco s utilization management rules. Policy 6-C 1
2 Policy The Plan Sponsor covers, where applicable, a Transition Supply for new and existing enrollees. Medco s Transition Process provides new and current enrollees with continued access to needed drugs whose current drug therapies are not included in the Plan Sponsor s formulary, or whose drugs require prior authorization, quantity limit, or step therapy under the Plan Sponsor s utilization management rules. Transition Process The Transition Process serves two purposes: it provides 1) a temporary supply of drugs during the Transition Period; and 2) sufficient time for enrollees to work with their health care providers to switch to a therapeutically appropriate formulary alternative, or to request an exception on the grounds of medical necessity. Medco s systems allow for a temporary supply to be provided for non-formulary Part D drugs and formulary drugs that are on formulary but to which a prior utilization or step therapy restriction is on the drug in order to accommodate the immediate needs of an enrollee, as well as to allow the plan and/or the enrollee sufficient time to work with the prescriber to make an appropriate switch to a therapeutically equivalent medication or the completion of an exception request to maintain coverage of an existing drug based on medical necessity reasons. Transition Supply Medco covers a Transition Supply according to the following: Retail or Mail Pharmacy: For enrollees who obtain their drugs in a retail setting, home infusion setting, I/T/U, safety-net pharmacies, or at mail, a one-time, temporary day supply of at least 30 days (unless the prescription is written for less than 30 days in which case the enrollee will be allowed multiple fills to provide up to a total of 30 days of medication)is provided anytime during the first 90 days of enrollment. The transition period begins on the enrollee s effective date of coverage into the plan. Long-term Care Setting: For enrollees who obtain their drugs in a LTC setting, multiple fills of a temporary supply is provided during the 90 day Transition Period. The window for refills is defined by taking the allowed day supply and multiplying by 3. So, if the allowed day supply is 31, the refill window is a 93 day supply. The transition period begins on the enrollee s effective date of coverage into the plan. CMS indicates that in an LTC setting the day supply allowed for transition should be a 31 day supply (unless the prescription is written for a shorter duration). Transition supplies in LTC settings are able to be provided at the point of sale. Emergency Transition Supply is granted to LTC enrollees whose dates of service are outside of the 90-day transition period. Medco covers a one time emergency Transition Supply of non- formulary Part D drugs (or drugs that have a step therapy edit or require a prior authorization) for 31 (or the defined amount for a one month supply by the plan in their bid) during this exception process (unless the enrollee presents with a prescription for less than 31 (or the defined amount for a one month supply by the plan in their bid), while an exception or prior authorization is requested. The decision pursuant to an exception request will not affect this emergency supply already in place. Policy 6-C 2
3 Emergency Supplies for Members Entering a LTC facility - Medco also covers an emergency Transition Supply of 31 (or the defined amount for a one month supply by the plan in their bid) for current enrollees who are entering a LTC facility from other healthcare settings. Medco will not utilize early refill edits to limit appropriate access to the member s Part D benefit, and will allow access to refill upon admission or discharge. Medco will not require residents of long-term care facilities to request an exception or coverage determination in order to receive an emergency supply or first fill of a non-formulary drug (or drugs that have a step therapy edit or require a prior authorization) when the member is outside of the initial transition period.ltc pharmacies are permitted to use Emergency Boxes (E Box) when necessary. However the E Box should be replenished from the patient s monthly Rx claim. Further details around submitting claims can be found in Medco s Long Term Care contracting policy # 14B. During the Transition Period, Medco assures a transition supply is provided. The enrollee is notified so that he or she can begin the exception process. Transition Population Medco s Transition Process applies to the following types of enrollees: New enrollees enrolled in Medco or a Medco administered prescription drug plan following the Annual Coordinated Election Period (AEP); Newly eligible Medicare beneficiaries. Individuals who change plans. Current enrollees affected by formulary change (including Part D drugs that are on the formulary but require prior authorization or step therapy) for an upcoming contract year if applicable. Existing LTC Residents who are outside their transition window but change therapy to a non formulary drug or a drug that has a step therapy edit or requires a prior authorization. This is known as an Emergency Supply. Auto-effectuation of Transition Supplies Medco pays transition claims through automatic effectuation. This functionality fires a soft edit, as follows: 1. If TelePAID determines that a member is eligible for a transition supply (at retail or in a long term care facility) or an emergency supply in a long term care facility, Medco will automatically pay the claim and mark it as a transition fill. 2. The claim will still reject if the quantity exceeds the Maximum Daily Dose (MDD) alert for those clients that have elected hard edits, to ensure that the pharmacist addresses the safety edit. If the pharmacist addresses the safety edit, the claim will pay as a transition supply. 3. If the quantity does not exceed the MDD, the days supply and quantity will pay exactly as submitted (even if it exceeds the 30 or 31 transition day supply which is the minimum plans are required to provide). 4. The claim will reject if it exceeds plan benefit limits. Policy 6-C 3
4 Level of Care Changes Medco covers a Transition Supply for enrollees who have a level of care change which is defined as when enrollees: Enter LTC facilities from hospitals or other settings; Leave LTC facilities and return to the community; Are discharged from a hospital to a home; End a skilled nursing facility (SNF) stay covered under Medicare Part A (where all pharmacy charges are covered), and must revert to coverage under their Part D plan formulary; Revert from hospice status to standard Medicare Part A and B benefits; and Are discharged from psychiatric hospitals with medication regimens that are highly individualized. While Part A does provide reimbursement for a limited supply to facilitate beneficiary discharge, beneficiaries must be permitted to have a full outpatient supply available to continue therapy once this limited supply is exhausted. Level of Care supplies will be available for prescriptions, when appropriate, that are received at a retail settings. Early-refill Edit: Medco does not use an early-refill edit to limit appropriate and necessary access to an enrollee s Part D benefit. In instances where an enrollee is admitted to, or discharged from, an LTC facility, Medco allows the enrollee to access a refill upon admission or discharge. However, Medco may use early-refill edits for safety reasons. Formulary Changes for Upcoming Contract Plan Year The Plan Sponsor may change its formulary for an upcoming contract plan year. When this is the case, Medco provides notice by mailing an Annual Notice of Change (ANOC) to enrollees by October 31 prior to the upcoming contract year. CMS allows a plan sponsor to select one of two options to effectuate a transition for enrollees whose drugs will no longer be included in the formulary for an upcoming contract year and formulary drugs that remain on formulary but to which a new prior utilization or step therapy restriction is added from one contract year to the next. Option 1: Provide a transition process for current enrollees who are currently on the drug that is moving to a non-formulary status or will have a rule added to it (i.e. PA or Step Therapy) consistent with the transition process required for new enrollees beginning January 1 of the upcoming contract year. In order to prevent coverage gaps, plans choosing this option must provide a temporary supply of the requested prescription drug with the applicable Formulary Transition Guidance. In addition, plans must provide enrollees with notice that they must either switch to a drug on the plan s formulary, or get an exception to continue to receive coverage. Option 2: Effectuate a transition for current enrollees prior to January 1 of the upcoming contract year. Under this option, plans must aggressively work to: 1) prospectively transition current enrollees to a therapeutically equivalent formulary alternative; and 2) complete requests for formulary and tiering exceptions to the new formulary prior to January 1 of the upcoming contract year. If a plan sponsor approves such an exception request, the plan sponsor shall authorize payment prior to January 1, and provide Policy 6-C 4
5 coverage beginning January 1 of the upcoming contract year. If, however, plans have not successfully transitioned affected enrollees to a therapeutically equivalent formulary alternative or processed an exception request by January 1, plans will be expected to provide a transition supply beginning January 1 of the upcoming contract year, and until such time as they have effected a meaningful transition. If Medco can identify objective information demonstrating that a meaningful transition has occurred (such as the processing of an exception request), then access to a transition supply in the new contract year for that beneficiary does not need to be provided. However, lacking such objective evidence, Medco will provide a transition supply in the new contract year and provide the corresponding transition notice. Medco will extend their transition policies across contract years should a beneficiary enroll into a plan with an effective enrollment date of either November 1 or December 1 and need access to a transition supply. For example, if a beneficiary enrolls effective December 1, in a plan whose transition policy affords a 90-day transition period for enrollees and that beneficiary requires a transition supply in mid- December, Medco will offer a full 90-day transition period beginning December 1 (including a one-time transition supply) and extending into the following contract year. In addition, Medco will send beneficiaries with a November 1 or December 1 effective enrollment date an ANOC as soon as practicable after the effective enrollment date. This ANOC will serve as advance notice of any formulary or benefit changes in the following contract year. Transition Period Extension Medco will continue to provide coverage for necessary Part D drugs to enrollees via an extension of the Transition Period, on a case-by-case basis, to the extent that their exception requests or appeals have not been processed by the end of the minimum Transition Period. The extension ends when a transition has been made, through a switch to an appropriate formulary drug, or a decision has been made on an exception request. For LTC beneficiaries, Medco will cover an emergency supply of non-formulary Part D drugs (including Part D drugs that are on the formulary but require a prior authorization or step therapy) for LTC facility residents as part of their transition process. During the first 90 days after a beneficiary's enrollment, he or she will receive a transition supply. However, to the extent that an enrollee in an LTC setting is outside his or her 90-day transition period, Medco will still provide an emergency supply of non-formulary Part D drugs including Part D drugs that are on the formulary that would otherwise require prior authorization or step therapy under a sponsor's utilization management rules while an exception or prior authorization is requested. Cost Sharing Medco may charge cost-sharing for the Transition Supply. For low-income subsidy (LIS) eligibles, cost-sharing for the Transition Supply shall not exceed the statutory maximum co- payment amounts. For non-lis enrollees, Medco charges cost-sharing consistent with its approved drug cost- sharing tiers. This cost-sharing is consistent with the cost-sharing of nonformulary drugs approved under a coverage exception. Policy 6-C 5
6 Network Pharmacy Messaging Any additional new network pharmacy messaging approved through NCPDP to address clarifying information needed to adjudicate a Part D claim will be promptly implemented in system changes or alternative approaches that achieve the messaging needed at network pharmacies for transition processes. Medco monitors transition supplies at retail pharmacies to ensure that members that are eligible for a transition supply receive their medication. Medco makes outbound phone calls to pharmacies when members did not receive their transition supply and inform the pharmacy to pay the claim and contact the member to obtain their medication. Utilization Management Edits 1. Medco may implement certain edits during the Transition Process. Such edits may include the following: Edits to help determine Part B vs. Part D coverage; Edits to prevent coverage of non-part D drugs (i.e., excluded drugs); and Edits to promote safe utilization of a Part D drug (e.g., quantity limits based on maximum recommended daily dose; early refill edits). Early Refill Edit:Medco does not use an early refill edit to limit appropriate and necessary access to a member s Part D benefit during a Transition Period. 2. In addition, Medco may apply the following edits, so long as such edits are resolved at Point of Sale (POS): Edits for additional step therapy; or Edits for prior authorization. 3. Transition Supply on quantity limit rules allows the full script amount up to the maximum days supply allowed, so refills are only necessary when the script is written for less than the required transition supply for members in their transition window. + Note: For members who receive transition supplies as a result of quantity limit rules, Medco issues a transition notice with the CMS model prior authorization explanation. This reason code is the most appropriate since the model quantity limit language indicates that the quantity was cut back. All edits are subject to the exceptions and appeals process. Enrollees are made aware of these edits, and the exception process relative to the edits. New Prescriptions vs. Refill Prescription Where Medco cannot distinguish at POS between a new prescription and a refill prescription involving Part D drugs that were previously covered as a Transition Supply, Medco applies the same transition process standards to the new prescription for a Part D drug pursuant to the Transition Supply section of this Policy. Transition Notices Medco sends a written notice, via U.S. mail, to each enrollee who receives a Transition Supply within 3 business days of the fill. The notice includes the following information: 1. Explanation of the temporary nature of the enrollee s Transition Supply; Policy 6-C 6
7 2. Instructions to work with Medco and the enrollee s prescriber to identify appropriate therapeutic alternatives that are on Medco s formulary; 3. Explanation of the enrollee s right to request a formulary exception, including timeframes for processing and the right to request an appeal if the decision is unfavorable; and 4. Description of the procedures for requesting an exception. Medco utilizes the CMS model Transition Notice and submits for CMS review via file and use. Prior Authorization and Exceptions Medco alerts members who receive a transition supply of the plan s coverage determination process. For clients that delegate the coverage determination process to Medco, Medco s process includes medical review of non-formulary drug requests. Following receipt of a request for coverage of a non-formulary drug, Medco attempts to obtain a supporting statement from the member's physician. Medco uses the information provided by the physician in the supporting statement to make a coverage determination. If this review does not confirm an affirmative medical necessity determination, the member will need to follow instruction provided on the Transition Notification, which was sent within three days of the claim adjudication, to obtain a therapeutically appropriate formulary alternative. Public Notice Medco provides general information about the Transition Process to enrollees through various methods, including plan enrollment materials, the plan website and a required link from the Medicare Prescription Drug Plan Finder to Medco s Medicare website. Prior authorization or exceptions request forms are available upon request to both enrollees and prescribing physicians via a variety of mechanisms, including mail, fax, and on the plan web-site. Pharmacy & Therapeutics Committee s (P&T) Role The Plan has a process review of medical policies for switching new Part D sponsor enrollees to therapeutically appropriate formulary alternatives failing an affirmative medical necessity determination. See also Medco policy 6A, for role of Plan s P&T Committee. The P&T Committee performs the following functions relative to the transition process: Reviews and provides recommendations regarding the procedures and policies for the medical review of non-formulary drug requests; Reviews the appropriateness of procedures that limit access where an enrollee is already stabilized on a drug, or has already tried the lower step agents; Reviews drugs and drug categories that are included in the transition process, and the duration of Transition Supply provided. P&T committee helps ensure that transition decisions appropriately address situations involving enrollees stabilized on drugs that are not on the sponsor s formulary (or that are on the formulary but require prior authorization or step therapy under a sponsor's utilization management requirements) and which are known to have risks associated with any changes in the prescribed regimen. Policy 6-C 7
8 Attachments Attachment A References CFR (b) 2. Medicare Prescription Drug Benefit Manual Chapter 6: Part D Drugs and Formulary Requirements (February 19, 2010) 3. CMS CY 2010 Transition Process Attestation 4. CMS Memorandum: Critical Steps as Transition Period Ends (March 30, 2006) 5. CMS Memorandum: Next Steps on Formulary Policies (March 17, 2006) 6. CMS Part D Question and Answer Database ID: 7245 (May 15, 2006) 7. Medco Medicare Part D Policy 6-A Formulary - Development and Change Notification 8. Medco Medicare Part D Policy 14-B Long Term Care Contracting CMS Call Letter (03/30/09) 10. CMS Memorandum: Part D Transition Policy Reminder (August 27, 2010) Schedule Initial Effective Date 08/24/2006 Committee Approval Date 4/13/11 Replaces 12/16/10 Next Review Date 4/2012 Department Owner Retiree Solutions Operations Business Owner Debra Dullinger Woody Eisenberg-Chair The services described in Medco policies are subject to the terms, conditions and limitations of the Member s contract or certificate. Unless otherwise stated, Medco polices do not apply to Medco Medicare Members. Medco reserves the right, in its sole discretion, to modify policies as necessary without prior written notice unless otherwise required by Medco s administrative procedures. The term Medco includes Medco Containment Insurance Company of New York, Medco Containment Life Insurance Company and all of its subsidiaries as appropriate for these policies. Certain policies may not be applicable to Self-Funded Members and certain insured products. Refer to the Member s plan of benefits or Certificate of Coverage to determine whether coverage is provided or if there are any exclusions or benefit limitations applicable to any of these policies. If there is a difference between any policy and the Member s plan of benefits or Certificate of Coverage, the plan of benefits or Certificate of Coverage will govern. Policy 6-C 8
9 Attachment A POLICY REVISION RECORD Policy #6-C Date Version # Revised by Summary of Revision 9/9/ v9 Laura Leech Revisions to conform to new CMS requirements 11/22/ v1 0 Laura Leech Revised to include Auto-effectuation of transition supply 12/16/ v1 1 Eugene Napolitano 4/13/ v12 Eugene Napolitano Revised to add applicable formulary drugs for transition, adjust allowable days supply for emergencies and revise allowable amounts on refills Revised Prior Authorization and Exceptions section Policy 6-C 9
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