Part 433, Subpart D State Agencies that administer the Medicaid program are to
insure if there is Third Party Liability, i.e., other insurance covering
prescription drugs, and see that TPL is billed to the full extent it is liable
before medicaid / Medical Assistance is billed. Medicaid is invariably a
secondary insurance.
Minnesota has a statute, administration rules and a pharmacy policy
manual aligned to federal law. The primary insurer must be billed to the extent
possible before billing Medical Assistance. That is the prime directive. In
processing pharmacy claims, however, pharmacies are only billing medical
assistance in some cases where a primary insurer should cover most of the cost.
A wonderful thing for the bottom line of private insurance companies.
Many insurers will only pay for 90 day supplies of routine prescriptions.
Medical Assistance will not pay for more than 34 day supplies as a rule, but
there are exception. If a pharmacist gets approval for a 90 day supply from the
primary insurer, MA refuses to pick up the copay that they are liable for. The
pharmacist sees a screen that says "exceeds 34 day supply limitation." Then the
pharmacist or pharmacy tech tries to bill the primary insurance, and is
informed that the primary insurance won't pay for less than a 90 day supply.
Then MA is billed for the full amount and pays the full amount without anyone
at the state throwing a switch. The pharmacists are not informed that MA will
pay the coinsurance on a 90 day supply if they request an over-ride and send in
some supporting documentation. And even if enlightened to do so, the pharmacy
prefers to bill MA for the whole thing because it is faster and cheaper for
them, and MA pays a set up fee. Why spend extra time for no extra compensation.
The pharmacists are not informed that there are exceptions to the 34 day rule,
including in situations where the primary insurer only pays for a 90 day
supply. The law is rarely followed.
There is a problem of having a computerized system with a default setting
that has to be repeatedly over-ridden in order to get payment from both the
primary insurer and medical assistance. Getting the primary insurer to pay its
share is the prime directive. However, on accounts where there is a primary
insurer, MA's automated system doesn't reject claims because the primary
insurer wasn't billed. To do so would create a dilemma in which the pharmacy
can't fill a prescription without getting an over-ride. There is a difference
between spending one or two minutes per order billing insurance for refills and
spending 15 to 20 minutes per order. So it is probably no coincidence that MA's
pre-authorization department keeps pharmacists blissfully ignorant of the law
they are supposed to follow. This process needs to be streamlined by MA's
pre-authorization department by changing the default setting for accounts with
primary insurers who don't pay for less than 90 day supplies for some
medications or charge premium copays for less than 90 day supplies. MA should
pick up the lowest possible copay instead of the entire cost. Primary insurance
coverage and dispensing rules always trump MA restrictions.
If the federal government should audit Minnesota MA's billing system, there
could be trouble. How much money is being improperly spent?
-Doug Mann, Minneapolis