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Alabama Medicaid

Updates from Alabama Medicaid

Medicaid Alert: Claims for Non-Enrolled OPR Providers to Deny Effective 1.1.13  |  Posted 12.13.12

Federal law now requires any ordering, referring or prescribing providers to enroll with Medicaid, even if they do not accept Medicaid, to help prevent and detect fraud and abuse. Alabama Medicaid will comply with this law effective January 1, 2013, by denying all claims that require a referral, order or prescription from a physician or other licensed health care professional unless that physician or provider has a current enrollment record on file.  Get the full update here.



Durable Medical Equipment (DME) Program Changes
posted 11.26.12

The Alabama Medicaid Agency’s Durable Medical Equipment Program will make changes to:

· Reimbursement for CPAP

· Humidifier Reimbursement

· External Breast Prostheses Prior Authorization

· Home Medical Equipment (HME) License

· Wheelchairs Coverage Limit Change

Detailed information about each change is attached. Also there is a reminder regarding the procedure for manually priced DME items’ Prior Authorization (PA) Requests.

Medicaid Alert: Four (4) Brand-Name Limit
posted 7.20.12

Effective for drugs dispensed on or after August 1, 2012, the Alabama Medicaid Agency will reinstate the four (4) brand-name drug limit per month.

The one brand-name drug limit will remain in effect for June 1, 2012 through July 31, 2012. Allowances will remain for up to 10 brands per month for antipsychotics, antiretrovirals, and switchovers.Children (recipients under 21) and nursing facility recipients are excluded from the four brand-name limit.Generics and covered over the counters remain unlimited. Policy questions concerning this ALERT should be directed to the Pharmacy Program at (334) 242-5050.

Medicaid PDL Update - April

Effective April 1, 2011, the Alabama Medicaid Agency will update the Preferred Drug List (PDL) to reflect the recent Pharmacy and Therapeutics (P&T) Committee’s recommendations as well as quarterly updates. The updates are listed below:PDL Additions Dulera-Respiratory/Inhaled Corticosteroids
Ritalin SR-Behavioral Health/Cerebral Stimulants/Agents for ADD/ADHD-Short and Intermediate ActingPDL Deletions*Daytrana-Behavioral Health/Cerebral Stimulants for ADD/ADHD-Long Acting
Dexedrine-Behavioral Health/Cerebral Stimulants for ADD/ADHD-Short and Intermediate Acting
Pataday-EENT Preparations/Antiallergic Agents
Patanase- EENT Preparations/Antiallergic Agents
Patanol- EENT Preparations/Antiallergic Agents
* Denotes that these brands will no longer be preferred but are still covered by Alabama Medicaid and will require Prior Authorization (PA). Available covered generic equivalents (unless otherwise specified) will remain preferred.

For additional PDL and coverage information, visit the Alabama Medicaid drug look-up site at

Medicaid PDL Update - January

Effective January 3, 2011, the Alabama Medicaid Agency will update the Preferred Drug List (PDL) to reflect the recent Pharmacy and Therapeutics (P&T) Committee recommendations as well as quarterly updates.

The updates are listed below:

PDL Additions

PDL Deletions*

N/A Aceon—ACE Inhibitors
Eurax—Skin and Mucous Membrane
Agents/Scabicides and Pediculicides
Micardis HCT—ARBs
Teveten HCT—ARBs

*Denotes that these brands will no longer be preferred but are still covered by Alabama Medicaid and will require prior authorization (PA) for payment.
Available covered generic equivalents (unless otherwise specified) will remain preferred.

Medicaid Reimbursements on Vaccinations

Alabama Medicaid is now reimbursing Medicaid-enrolled pharmacy providers for the administration, to eligible recipients age 19 and older, of pneumococcal vaccine and Tdap vaccine. Alabama Medicaid will also continue to, in addition to the administration reimbursement, reimburse pharmacies for the pneumococcal and Tdap vaccines.
Pharmacy providers may bill the following NDC numbers on a pharmacy claim for reimbursement of vaccine administration:

• NDC 99999-9992-11 for pneumococcal vaccine administration
• NDC 99999-9993-11 for Tdap vaccine administration

Reimbursement is $5 per administration with no dispensing fee or co-pay applied.

Claims should be submitted with a dispense quantity of 1 for vaccine administration. There is a maximum quantity for each administration of 1 injection per recipient within a timeframe in accordance with the Centers for Disease Control (CDC) dosing regimen.

A prescription from a recipient’s Primary Medical Provider (PMP) is required for each Tdap and pneumococcal vaccine administration.

Pharmacies may also be reimbursed for administration of the seasonal influenza vaccine to Medicaid eligible persons ages 19 and older. Pharmacists should submit the NDC of 99999-9999-10 on a pharmacy claim for the administration of the vaccine for reimbursement. Pharmacists will also be reimbursed for the cost of the vaccine.

Alabama Medicaid Phase III Overview

The Alabama Medicaid Agency is now in the process of establishing the guidelines for the Pharmacy Professional Service Reimbursement Program (Phase III of the Pharmacy Reimbursement Modification Initiative). The aim of the program is to develop shared savings reimbursements to pharmacy providers for services (outside of those included in CMS’ dispensing fee definition) rendered to Alabama Medicaid recipients.

The primary goals of Phase III are to:

1. Decrease pharmaceutical and medical costs to Agency
2. Maintain and possibly increase recipients’ health outcomes
3. Identify professional services provided by pharmacy providers, and
4. Provide a financial incentive (when possible) to pharmacy providers who participate in cost savings initiatives.

The proposed components of the program include Pharmacist Vaccine Administration, Long Term Maintenance Program, Tablet Splitting, and Short Term Starter Therapy. Generic Dispensing and ePrescribing are other components being considered.

Pharmacist Vaccine Administration

The projected implementation date for this program is November 1, 2010. In addition to the current vaccines, the recommendation is to reimburse pharmacy providers for administration of Agency specified vaccines to eligible recipients 19 and older. The plan recommendation is to reimburse pharmacy providers for administration of the pneumococcal and Tdap (tetanus) vaccines to eligible adult recipients (outside of the VFC program). The administration reimbursement fee would be $5.00.

Long-term Maintenance

The long-term maintenance program has a projected implementation date of March 1, 2011. This program would allow pharmacies to be reimbursed for a 90-day supply of preferred maintenance medication (in Agency specified drug classes) as opposed to the current 34-day period. The program would target low-cost maintenance medication drugs used to treat chronic illnesses. An additional professional service fee of $10.00 would be paid for each qualifying 90-day supply dispensed. An alternative to this would be to pay participating providers quarterly, minus any outstanding recoupments due to the Agency.

Tablet Splitting

Tablet-splitting is another facet of the program with a projected implementation date of May 1, 2011. The concept is to target flat-priced preferred drugs that can be split and remain therapeutically effective as identified by the Agency. The pharmacist would split and dispense medication and possibly receive an incentive, while decreasing the Agency’s cost by up to 50%. A $10.00 professional service reimbursement would apply in addition to the current dispensing fee. Participation would be voluntary, and the prescription would need to be coordinated with the physician. Patient consultation would also need to be documented and the provider would need to submit the appropriate NCPDP field/description on claim to receive professional service fee reimbursement.

Short-term Starter Therapy

The projected implementation date for this program is August 1, 2011. In certain disease states (such as mental health) a 34-day supply of medication may not be completely consumed by the patient due to the physician changing the medication as a result of unfavorable treatment outcomes or negative side effects. The concept is to target high-cost drugs that commonly require adjustment with the initial therapy. Limited dispensing would avoid medication waste and decrease spending. Providers would receive an additional dispensing fee for starter medication, as specified by the Agency, for up to a 30-day supply. Participation would be voluntary.

Changes to the State Plan, Administrative Code, Provider Billing Manual, MMIS and Provider Education documents were submitted on October 15, 2010 for internal review and approval. State Plan Amendments will be submitted CMS on November 1, 2010 with an effective date of February 1, 2011. For more details on this program check the Alabama Medicaid Agency Web site.

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New Website to Help with Drug/NDC Questions

This website helps providers to determine what drugs/NDCs are covered, how much the reimbursement rate is, and whether or not the drug requires a prior authorization.

Average Acquisition Cost (AAC) Reimbursement for Drug Ingredient Cost

The Alabama Medicaid Agency has moved to an Average Acquisition Cost (AAC) reimbursement for drug ingredient cost, plus a modified dispensing fee, for outpatient pharmacy claims as of September 22, 2010. Pharmacy providers are not required to take any new or additional action when submitting claims. 

The new federally-approved change in how Alabama Medicaid reimburses pharmacies for drugs provided to Medicaid recipients now makes it possible for the Agency to implement a reimbursement system that more accurately reflects the true estimated acquisition costs for drug ingredients.

The Centers for Medicare and Medicaid Services (CMS) notified the Agency September 16 that the state’s request to remove Average Wholesale Price (AWP) from the “lower of” reimbursement methodology now in use, and add the invoice-based Average Acquisition Cost (AAC) method for brand and generic drug ingredient costs was approved. CMS also approved a companion request to increase the Agency’s dispensing fee from $5.40 per prescription to $10.64 per prescription based on an independent Cost of Dispensing (COD) survey.

Additional information can be found on the Agency AAC website at the link

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