NC Medicaid has learned some prepaid health plans (PHPs) are denying certain medications that are reimbursable under NC Medicaid Direct because the medication’s NDC number is not considered eligible for a rebate by CMS because it is not listed in the Drug Data Reporting for Medicaid (DDR) system. The PHP contract with NC Medicaid requires that:
b. The PHP shall:
i. Cover all covered outpatient drugs for which the manufacturer has a Centers for Medicare and Medicaid Services (CMS) rebate agreement and for which the Department provides coverage. 42 C.F.R. § 438.3(s)(1);
ii. Adhere to the Department’s defined preferred drug list (PDL); and
iii. Furnish covered benefits in an amount, duration and scope no less than the amount,
duration, and scope for the same services furnished to beneficiaries under the Medicaid
Fee-for-Service program. 42 C.F.R. § 438.210(a)(2).”
- NC Medicaid is directing PHPs to provide reimbursement for NDCs that are covered by NC Medicaid Direct, with eligibility determined at the manufacturer level. Coverage shall be provided during at least a 6-month grace period for new NDCs, allowing time for a NDC number to be added to the DDR. This approach conforms to the general principal under Section 1927 of the Social Security Act that all covered outpatient drugs of a manufacturer who has a rebate agreement with the Secretary are reimbursed by state Medicaid programs.
- This approach provides access for beneficiaries to medications covered under NC Medicaid Direct, including new medications awaiting publication on the DDR.
- It also incorporates CMS’ sub regulatory guidance to rely on the DDR when determining whether to reimburse for a particular drug (i.e., review for NDC numbers), while balancing any potential harm to beneficiaries who may be denied access to medications, because of the 6-month lag time in CMS updating the DDR for new NDCs.
PHPs are required to provide drug coverage to Medicaid beneficiaries consistent with the drug coverage determined by NC Medicaid under fee for service, pursuant to their contract. The PHPs’ capitation rate has built in the cost of coverage for all covered outpatient drugs from manufacturers that have rebate agreements. PHPs do not have a contractual obligation to check the DDR and in turn potentially reject payment for a drug whose NDC number does not appear. This is the role of the state Medicaid program.
Contact
NC Medicaid Contact Center, 888-245-0179