Magellan Health Services Provider Manual Version 1.1 January 1, 2014
Magellan Health Services Provider Manual Version 1.1 January 1, 2014 Provider Manual Revision History Document Version 1.0 1.1 Page 2 Date 09/17/13 12/23/12 Name Training and Development; Communication and Documentation Management Jennifer Goggin; Communication and Documentation Management Comments Initial creation of document Rebranded with Magellan Health Services template and logo Magellan Health Services Provider Manual Table of Contents Revision History .................................................................................................................................2 Table of Contents ...............................................................................................................................3 1.0 Introduction ..........................................................................................................................6 1.1 Magellan Pharmacy Program ...................................................................................................... 6 1.2 Contact Information .................................................................................................................... 7 1.3 Addresses..................................................................................................................................... 8 1.4 Websites ...................................................................................................................................... 8 2.0 Pharmacy Relations ...............................................................................................................9 2.1 Enrolling as an Approved Pharmacy ............................................................................................ 9 2.1.1 Pharmacy Network Application and Disclosure Process ......................................................... 9 2.1.2 Fraud, Waste, Abuse, and Program Integrity ........................................................................ 10 2.1.3 Right to Inspection by Government Entities ......................................................................... 13 2.1.4 Monthly Screening Requirements and Exclusion from Participation in Government Health Care Programs .................................................................................................................................... 14 2.1.5 Compliance with Legal Regulations ...................................................................................... 15 2.1.6 Incorporation by Reference of Federal and State Law/Regulation....................................... 15 2.1.7 HIPAA Compliance................................................................................................................. 15 2.2 Provider Credentialing ............................................................................................................... 18 2.3 Member Complaints .................................................................................................................. 19 2.4 Medication Error Reporting....................................................................................................... 19 2.5 Pharmacy Dispute Process ........................................................................................................ 20 2.6 Pharmacy Suspension Process................................................................................................... 21 3.0 Billing Information ...............................................................................................................23 3.1 Claim Formats and Plan – Specific Values ................................................................................. 23 3.2 Magellan Website Pharmacy Portal .......................................................................................... 23 4.0 Magellan Services Call Center ...............................................................................................24 4.1 Pharmacy Support Center ......................................................................................................... 24 4.2 Clinical Support Call Center ....................................................................................................... 24 4.3 Web Support Call Center ........................................................................................................... 24 5.0 Program Setup .....................................................................................................................26 5.1 Claim Format ............................................................................................................................. 26 5.2 Point-of-Sale – NCPDP Version D.0............................................................................................ 26 5.2.1 Supported POS Transaction Types ........................................................................................ 26 5.2.2 Required Data Elements........................................................................................................ 27 5.3 Paper Claims .............................................................................................................................. 30 6.0 Service Support....................................................................................................................31 6.1 Online Certification.................................................................................................................... 31 Provider Manual 6.2 Solving Technical Problems ....................................................................................................... 31 7.0 Online Claims Processing Edits .............................................................................................33 7.1 Paid, Denied, and Rejected Responses...................................................................................... 33 7.2 Duplicate Response ................................................................................................................... 33 8.0 Program Specifications .........................................................................................................34 8.1 Timely Filing Limits .................................................................................................................... 34 8.2 Mandatory Generic Requirements ............................................................................................ 34 8.3 Dispensing Limits/Claim Restrictions......................................................................................... 34 8.3.1 Days’ Supply .......................................................................................................................... 35 8.3.2 Quantity................................................................................................................................. 35 8.3.2.1 Minimum or Maximum Quantity Limits, Quantity Per Day, Quantity Over Time, and Maximum Daily Dose.......................................................................................................................... 35 8.3.3 Dollar Limit ............................................................................................................................ 35 8.3.4 Minimum/Maximum Age Limits ........................................................................................... 35 8.3.5 Refills ..................................................................................................................................... 35 8.4 Provider Reimbursement .......................................................................................................... 35 8.4.1 Provider Reimbursement Rates ............................................................................................ 35 8.5 Plan Co-Pays .............................................................................................................................. 36 8.6 Prior Authorizations................................................................................................................... 36 8.6.1 Clinical PAs ............................................................................................................................ 36 8.6.2 Emergency Protocols............................................................................................................. 36 8.6.3.1 Emergency Supply Override Process ................................................................................ 36 8.6.3.2 Pharmacy Override Summary ........................................................................................... 37 8.6.4 Preferred Drug List (PDL)/PA/Quantity/Duration Lists ......................................................... 38 8.7 ProDUR Drug Utilization Review (ProDUR) ............................................................................... 39 8.7.1 Drug Utilization Review (DUR) Edits...................................................................................... 39 8.7.2 ProDUR Overrides ................................................................................................................. 40 8.8 Retro DUR .................................................................................................................................. 43 8.9 Special Participant Conditions ................................................................................................... 44 8.9.1 Lock-In ................................................................................................................................... 44 8.10 Compound Claims...................................................................................................................... 44 8.10.1 Fields Required for Submitting Multi-Ingredient Compounds ......................................... 46 8.11 Partial Fills.................................................................................................................................. 46 9.0 Coordination of Benefits (COB) .............................................................................................47 9.1 COB General Instructions .......................................................................................................... 47 9.1.1 COB Process........................................................................................................................... 47 10.0 Appendix A – Plan D.0 Payer Specification ............................................................................51 11.0 Appendix B – Point-of-Sale Reject Codes and Messages ........................................................52 11.1 Version D.0 Reject Codes for Telecommunication Standard .................................................... 52 12.0 Appendix C – State Medicaid Regulatory Requirements ........................................................62 Provider Manual 12.1 Kentucky Regulatory Addendum ............................................................................................... 62 12.1.1 Article 1 – Kentucky Health Benefit Plan Requirements .................................................. 63 12.1.2 Article II – Kentucky Managed Care Plan Requirements .................................................. 64 12.1.3 Article III – Kentucky Health Maintenance Organization and Limited Health Service Benefit Plan Requirements................................................................................................................. 66 12.1.4 Article IV – Kentucky Managed Medicaid Requirements ................................................. 68 12.2 South Carolina Regulatory Addendum ...................................................................................... 69 12.2.1 Article I – In General ......................................................................................................... 70 12.2.2 Article II – SC DHHS Medicaid Requirements ................................................................... 70 12.3 Florida Regulatory Addendum................................................................................................... 80 13.0 Index ...................................................................................................................................84 Provider Manual 1.0 Introduction Magellan Health Services (“Magellan”) is the Pharmacy Benefit Manager (PBM) for the Plan. As the PBM, Magellan will administer the point-of-sale (POS) system to process pharmacy claim transactions. The POS will accept pharmacy transactions in the National Council for Prescription Drug Programs (NCPDP) standardized version D.0; lower versions will not be accepted. After submission, Magellan will respond to the pharmacy provider with information regarding member eligibility, the Plan allowed amount, applicable Prospective Drug Utilization Review (ProDUR) messages, and applicable rejection messages. ProDUR messages will be returned in the DUR response fields. Other important related information will appear in the free-form message area. In addition to POS claims, Magellan will accept claims from approved providers via electronic batch on diskettes or through file transfer protocol (FTP). The format for an electronic media is NCPDP Batch version 1.2. All arrangements with switching companies and software vendors should be handled directly by the provider with their preferred vendor. 1.1 Magellan Pharmacy Program This manual provides claims submission guidelines for the pharmacy program administered by Magellan. Important Plan coverage and reimbursement policies are available in this Magellan Health Services Provider Manual. The Magellan website contains a link to this document. Subsequent revisions to this document are available by accessing the link. • For the most current version of this manual, refer to the Magellan website at www.magellanhealthpharmacy.com. Provider Manual 1.2 Contact Information Contact/Topic Contact Numbers Magellan Health Services 800-651-8921; Pharmacy Support Center option 4, option 24/7/365 2, then option 3 for Pharmacy Magellan Health Services Clinical Call Center (Prior Authorizations) 24/7/365 Web Support Call Center 8:00 a.m. – 8:00 p.m., ET, Monday–Friday Mailing, E-mail, and Web Addresses Magellan Health Services P.O. Box 85042 Richmond, VA 23261-5042 Purpose/Comments Pharmacy calls for 800-651-8921; option 4, option 2, then option 2 for Prescriber Prescriber calls for PA requests and questions 800-651-8921; option 3 Pharmacy calls for Magellan Health Services Network Services Department 9:00 a.m. – 6:30 p.m., ET, Monday-Friday Contacts: 860-507-1864 csmaahs@magellanhealth.com 804-548-0112 gduncan@magellanhealth.com Magellan Health Services Member Call Center 800-651-8921; option 4, option 2, then option 1 Gerald Duncan: Manager, Government Programs 24/7/365 Member Appeals 24/7/365 FTP Assistance with UAC, WebRA, and WebPA; Password management; and Navigation. rxnetworksdept@magellanhealth Pharmacy Network .com Relations Issues Chris Maahs: VP Jim Schewe: Dir, Network Services ProDUR questions Non-clinical prior authorization (PA) and early refills Questions regarding Payer Specifications, etc. 860-507-1871 800-651-8921; option 4, option 2, then option 1 800-924-6741 jwschewe@magellanhealth.com Contractual requests, questions or issues Network communications questions / clarifications Secondary issue resolution if not provided by the Pharmacy Support Center NCPDP Batch 1.2 Provider Manual 1.3 Addresses Address Paper Claims Billing Address: Magellan Health Services Paper Claims Processing Unit P.O. Box 85042 Richmond, VA 23261-5042 Diskette Claims Address: Magellan Health Services 11013 W. Broad Street Suite 500 Glen Allen, VA 23060 FTP: Magellan Health Services 1-804-290-8371 (fax forms) 1.4 Format CMS 1500 NCPDP Batch 1.2 NCPDP Batch 1.2 Websites Magellan Health Services: https://magellanhealthpharmacy.com. Provider Manual 2.0 Pharmacy Relations The Magellan Health Services Provider Manual addresses the following for participating pharmacies: Orientation of new participating pharmacies Updates of network activities Changes in state/federal regulatory contracting provisions Provide information to pharmacies on how to obtain information regarding benefits, eligibility, formulary, dispute, and appeals information 2.1 How to obtain a current copy of this manual and other documents that describe the relationship between Magellan and participating pharmacies Enrolling as an Approved Pharmacy The Magellan Provider Network consists of contracted pharmacies. To enroll as a Magellan pharmacy provider, please follow the steps in Section 2.1.1. – Pharmacy Network Application and Disclosure Process. 2.1.1 Pharmacy Network Application and Disclosure Process All pharmacies interested in participating in the Magellan Pharmacy Network must submit the following: Provider Application and Agreement Pharmacy Disclosure Form Both documents are available for request at https://mhs.magellanpharmacysolutions.com/pharmacy/common/source/contact_us.shtml. 2.1.1.1 Instructions for Completing the Pharmacy Disclosure Form 1. Fill out all sections on the Disclosure of Ownership and Control Interest Statement upon request by Magellan. Note: Each pharmacy participating in the Group Purchasing Organization (GPO) or the Pharmacy Services Administration Organization (PSAO) MUST be monitored and reported to PBM by the PSAO entity on an annual basis and monitored against the List of Excluded Individuals and Entities (LEIE) maintained by the Office of Inspector General (OIG) and the System for Award Management (SAM) exclusion lists on a monthly basis. Any participating pharmacies or owners and their pharmacy confirmed as excluded must be removed from the PSAO Network immediately and reported to PBM upon removal. Return the completed form to PBM and fax to 1-888-656-4139: Provider Manual Magellan Health Services 11013 West Broad Street Suite 500 Glen Allen, VA 23060-5939 ATTN: Vice President Pharmacy Network Development COPY TO: General Counsel Should you have any questions or concerns, please contact the Pharmacy Network team at the following: Pharmacy Networks Department Magellan Health Services 11013 West Broad Street Suite 500 Glen Allen, VA 23060-5939 Department Fax Number: 1-804-548-0963 Department E-mail: RxNetworksDept@MagellanHealth.com Chris Maahs, Vice President, Pharmacy Network Development: 1-860-507-1864 csmaahs@MagellanHealth.com James Schewe, Director Pharmacy Network Operations: 1-860-507-1871 jwschewe@MagellanHealth.com Gerald Duncan, Manager, Pharmacy Networks Government Programs 1-804-548-0112 gduncan@MagellanHealth.com Kris Borchardt, Manager Commercial MAC Programs: 1-860-507-1878 kborchardt@MagellanHealth.com 2.1.2 Fraud, Waste, Abuse, and Program Integrity Magellan’s pharmacy audit process conducts extensive monitoring and auditing provider utilization as part of a Program Integrity Plan, and claims to detect and prevent fraud, waste, and abuse by enrollees, pharmacies, and prescribers. Magellan auditing capabilities are supported through systematic accumulations and reporting of the same, automated, and on-request reporting, dashboards, and results stratification to identify outliers for further review, analytics, or recovery/recoupment activity. Some of these processes include Reviewing prescription claims for children to screen for possible fraudulent attempts by adult recipients to obtain prescriptions for themselves; Provider Manual Contacting pharmacies with aberrant claims or trends to gain an acceptable explanation for the finding or to submit a corrected claim; and Maintaining a log of aberrant claim activities. Magellan summarizes and reports audit results, and meets with the Plan to review and address program revisions. Reports are provided to the Plan via secured communication. 2.1.2.1 Reporting Fraud The Pharmacy shall report any suspicion or knowledge of fraud and/or abuse to the Plan’s Program Integrity Unit (PIU), including but not limited to, the false or fraudulent filings of claims and/or the acceptance or failure to return monies allowed or paid on claims known to be false, incorrect, inaccurate, or fraudulent. The Pharmacy shall not attempt to investigate or resolve the reported suspicion, knowledge, or action without informing the PIU, and must cooperate fully in any investigation by the PIU, or appropriate state and federal authorities, or a subsequent legal action that may result from such an investigation. The Pharmacy shall, upon request, make available all administrative, financial, and medical records relating to the delivery of items or services for which Plan monies are expended to the Plan. Additionally, the PIU and its auditors and subcontracted auditors, shall be allowed access to any place of business and to all records of the Pharmacy, Subcontractor, or any other entity during normal business hours, except under special circumstances when after-hour admission shall be allowed. Special circumstances shall be determined by the PBM Network Manager. 2.1.2.2 Desktop Audit Pharmacy claims are reviewed by the PIU and its auditors utilizing proprietary algorithms that are designed (and continuously improved upon) to find claims that may be fraudulently, erroneously, or suspiciously filed. We examine compound claims, controlled substance dispensing, and comparative metrics (benchmarked on network) to identify trends that are occurring outside the norms of the rest of the network. This information will also be used when selecting pharmacies for on-site audits. Findings are then forwarded directly to the provider. The pharmacy audit team will analyze the prescription data for any inconsistencies or unusual activity and patterns. Pharmacy claims data run through queries to find patterns, anomalies, errors, and potential fraudulent activity. The audit criteria utilized includes, but is not limited to Package size issues; Quantity discrepancies; Number of refills to drug mismatch; Excessively high dose per day; Total number of prescriptions; Duplication of therapies; and Mismatch between prescriber, pharmacy and member zip codes. Provider Manual The information reviewed in a desktop audit includes Average prescription price; Average amount paid; Low generic utilization and dispensing; Average quantity per prescription; Amount of controlled substance drugs per prescription; Accuracy of days’ supply information; Accuracy of physician identification; and Accuracy of member identification. Documentation mailed by a pharmacy in response to an audit will be imaged along with the envelope the documentation was sent in. Magellan will deliver a preliminary audit report (initial audit findings) to the pharmacy within 120 days after the conclusion of the audit and a final audit report (final audit findings) shall be delivered to the pharmacy within six months after receipt of the preliminary audit report or final appeal, whichever is later. All audit reports will be delivered to the pharmacy in the following manner: When no audit discrepancies are found, a congratulatory letter will be sent. When audit discrepancies are found, the audit findings report will be sent via certified mail with a signature required. When mailing audit notifications and audit reports, initial and final audit findings, the mailings will be postmarked the same date as the letter. 2.1.2.3 On-site Audit Magellan may initiate a field audit when desk audits consistently identify aberrations that cannot be explained by other means; or at the request of the Plan, upon requests from State, legal authorities and other regulatory agencies. The objective of the field audit shall include recommended financial recovery and/or elimination of the aberrant practice. Magellan uses these visits as opportunities to provide immediate training, and to verify the pharmacy provider has adequate processes in place to service the Plan’s enrollees (e.g., return to stock procedures, fulfilling OBRA ‘90 requirements, sanctioned provider notification, and other issues germane to this contract. On-site audits can be triggered by a high incidence of desk audits based on query findings, repeated recurrences of a similar audit issue, or egregious billing patterns and random selection. On-site audits may also be conducted upon individual requests from the Plan. Magellan generates and maintains pharmacy reports that identify pharmacies for on-site audits. The components of these scorecards include, but are not limited to Average prescription price; Provider Manual Generic utilization rate; and Accuracy of information supplied. Pharmacies will be given, at minimum, a one-week notice of an on-site audit: The audit will not be scheduled during the first seven days of a calendar month. The period covered by the audit will not exceed two years from the date the claim was adjudicated. Any issue involving clinical judgment will be discussed with the store’s pharmacist. Activities performed during the on-site audit include but are not limited to Questionable prescriptions are reviewed to pre-determined criteria to assess accuracy; Overall inspection of the pharmacy and pharmacy staff; Pharmacy and pharmacists’ licenses are checked to ensure they are present and in effect; Review of discrepant claims; and Review of the Plan’s policy and procedure for claim submission. Once the on-site audit is completed, Magellan will compile a report summarizing the findings of the audit, which will be sent to the pharmacy provider. Other activities performed during intensified on-site audits may include Stock and quantity on hand is compared to claims submitted and wholesaler records; Contacting prescribers either directly or through member chart reviews; and Send patient response letters. Magellan will refer a provider to the Program Integrity Unit section when a policy violation is found. Should you have any questions pertaining to Program Integrity, you may contact us at Program Integrity Unit 11013 West Broad St Suite 500 Glen Allen, VA 23060 PIU@MagellanHealth.com. 2.1.3 Right to Inspection by Government Entities Provide that Plan, Department of Health and Human Services (DHHS) OIG, Office of the Comptroller of the Treasury, OIG, Medicaid Fraud Control Units (MFCU), and Department of Justice (DOJ), as well as any authorized state or federal agency or entity, shall have the right to evaluate through inspection, evaluation, review or request, whether announced or unannounced, or other means any records pertinent to the Agreement, including but not limited to, Provider Manual Medical records; Billing records; Financial records, and/or any records related to services rendered, quality, appropriateness, and timeliness of services; and/or Any records relevant to an administrative, civil, and/or criminal investigation and/or prosecution. When performed or requested, the evaluation, inspection, review, or request, shall be performed with the immediate cooperation of the Pharmacy. Upon request, the Pharmacy shall assist in such reviews, including the provision of complete copies of medical records. Health Insurance Portability and Accountability Act of 1996 (HIPAA) does not bar disclosure of protected health information (PHI) to health oversight agencies, including but not limited to, OIG, MFCU, DHHS OIG and DOJ, so long as these agencies operate in compliance with applicable regulations. Provide that any authorized state or federal agency or entity, including, but not limited to, Plan, OIG, MFCU, OIG, DOJ, and the Office of the Comptroller of the Treasury may use these records and information for administrative, civil, or criminal investigations and prosecutions within the limitations set forth under HIPAA and Health Information Technology for Economic and Clinical Health (HITECH). 2.1.4 Monthly Screening Requirements and Exclusion from Participation in Government Health Care Programs For the purpose of the Exclusion and Screening Requirements, the following definitions shall apply: “Exclusion Lists” means the US DHHS’s OIG’s List of Excluded Individuals/Entities (located at https://oig.hhs.gov/exclusions/index.asp) and the General Services Administration’s List of Parties Excluded from Federal Programs (located at https://www.sam.gov/portal/public/SAM/) “Ineligible Persons” means any individual or entity who Is, as of the date such Exclusion Lists are accessed by the Provider, excluded, debarred, suspended, or otherwise ineligible to participate in Federal health care programs, or in Federal procurement or non-procurement programs; OR Has been convicted of a criminal offense that falls within the ambit of 42 U.S.C. § 1320(a)-7(a), but has not yet been excluded, debarred, suspended, or otherwise declared ineligible. The Pharmacy shall immediately notify the Pharmacy Network Vice President or Director should any pharmacist employed by the Pharmacy be sanctioned by the Federal OIG, the DHHS, or the Centers for Medicare & Medicaid Services (CMS). No pharmacists who have been excluded from participation in any government health care programs (Medicare, Medicaid, or other state or federal government health care programs) shall be permitted to participate in the Plan program unless they can document that Federal OIG, CMS, or DHHS has fully reinstated them as a Provider Manual participating provider. The Pharmacy shall immediately notify the PBM if it has been excluded from participation in the Medicare and/or Medicaid programs pursuant to Sections 1128 or 1156 of the Social Security Act, or is otherwise not in good standing with the Plan Program. Failure to notify the PBM shall constitute a material breach of the Agreement. Failure to provide the PBM with this information may also be cause for termination of the Pharmacy from participation in the Plan Program, and recoupment of any and all reimbursements made to the Pharmacy during the time period such excluded provider was providing Pharmaceutical Services to Plan enrollees. The Pharmacy shall screen its employees, owners, officers, and managing agents and contractors initially and on an ongoing monthly basis to determine whether any of them has been excluded from participation in Medicare, Medicaid, SCHIP, or any Federal health care programs (as defined in Section 1128B(f) of the Social Security Act), and are not employing or contracting with an individual or entity that has been excluded. The Pharmacy shall be required to immediately report to the PBM any exclusion information discovered. The Pharmacy shall be informed that civil monetary penalties may be imposed against providers who employ or enter into contracts with excluded individuals or entities to provide items or services to Plan enrollees. 2.1.5 Compliance with Legal Regulations Both the PBM and the Pharmacy agree to recognize and abide by all state and federal laws, rules, regulations, and guidelines applicable. The Agreement incorporates by reference the scope of the services provided or anticipated to be provided by the Agreement, including, but not limited to, the State Plan, 42 CFR § 431.107, 42 CFR 455 subpart B, and Plan rules. 2.1.6 Incorporation by Reference of Federal and State Law/Regulation By reference, the Agreement incorporates all applicable federal and state laws and regulations, and any applicable court orders or consent decrees; all revisions of such laws or regulations court orders or consent decrees shall automatically be incorporated into the Agreement as they become effective. The Pharmacy shall be compliant with Section 6032 of the Deficit Reduction Act of 2005 (DRA) with regard to policy development, employee training, and whistle blower protection related to The False Claims Act, 31 USCA § 3729-3733, et seq. 2.1.7 HIPAA Compliance In accordance with the HIPAA regulations, the Pharmacy shall at a minimum comply with the following requirements: As a party to this Agreement, the Pharmacy hereby acknowledges its designation as a covered entity under the HIPAA regulations. Provider Manual The Pharmacy shall comply with the transactions and code set, privacy, and security regulations of HIPAA. Compliance includes meeting all required transaction formats and code sets with the specified data partner situations required under the regulations. The Pharmacy shall transmit/receive from/to its provider, subcontractors, clearinghouses, and PBM all transactions and code sets required by the HIPAA regulations in the appropriate standard formats as specified under the law and as directed by the PBM so long as the PBM’s direction does not conflict with the law. The Pharmacy shall agree that if it is not in compliance with all applicable standards defined within the transactions and code sets, privacy, security, and all subsequent HIPAA standards, that it shall be in breach of the Agreement and shall then take all reasonable steps to cure the breach or end the violation as applicable. Since inability to meet the transactions and code sets requirements, as well as the privacy and security requirements can bring basic business practices between the PBM and the Pharmacy and between the Pharmacy and its providers and/or subcontractors to a halt, if for any reason the Pharmacy cannot meet the requirements of this Section, the PBM may terminate this Agreement in accordance in the Pharmacy Benefit Management Pharmacy Network Agreement. PHI data exchanged between the Pharmacy and the PBM is intended to be used only for the purposes of health care operations, payment, and oversight and its related functions. All PHI not transmitted for the purposes of health care operations and its related functions, or for purposes allowed under the HIPAA regulations shall be de-identified to protect the individual enrollee’s PHI under the privacy act. Disclosures of PHI from the Pharmacy to the PBM shall be restricted as specified in the HIPAA regulations and shall be permitted for the purposes of health care operation, payment, and oversight; obtaining premium bids for providing health coverage; and modifying, amending, or terminating the group health plan. Disclosures to the PBM from the Pharmacy shall be as permitted and/or required under the law. The Pharmacy shall report to PBM within 48 hours of becoming aware of any use or disclosure of PHI in violation of the Agreement by the Pharmacy, its officers, directors, employees, subcontractors, or agents or by a third-party to which the Pharmacy disclosed PHI. The Pharmacy shall specify in its agreements with any agent or subcontractor of the Pharmacy that shall have access to PHI that such agent or subcontractor agrees to be bound by the same restrictions, terms, and conditions that apply to the Pharmacy pursuant to this Section. The Pharmacy shall make available to Plan enrollees the right to amend their PHI in accordance with the HIPAA regulations. The Pharmacy shall also make information available to enrollees, educating them of their rights and necessary steps in this regard in their Notice of Privacy Practices. The Pharmacy shall make an enrollee’s PHI accessible to the Plan immediately upon request by Plan authorized staff. Provider Manual The Pharmacy shall make available to the PBM within 10 days of notice by the PBM to the Pharmacy, such information as in the Pharmacy’s possession, and is required for the PBM to make the accounting of disclosures required by 45 CFR § 164.528. At a minimum, the Pharmacy shall provide the PBM with the following information: A brief description of the PHI disclosed A brief statement of the purpose of such disclosure that includes an explanation of the basis for such disclosure. The Pharmacy shall create and adopt policies and procedures to periodically audit adherence to all HIPAA regulations, and for which Pharmacy acknowledges and promises to perform, including, but not limited to, the following obligations and actions: The name of the entity or person who received the HIPAA PHI, and if known, the address of such entity or person In the event that the request for an accounting of disclosures is submitted directly to the Pharmacy, the Pharmacy shall within two days forward such request to PBM. It shall be the PBM’s responsibility to prepare and deliver any such accounting requested. Additionally, the Pharmacy shall institute an appropriate record keeping process and procedures and policies to enable the Pharmacy to comply with the requirements of this section; l) The Pharmacy shall make its internal policies and procedures, records and other documentation related to the use and disclosure of PHI available to the Secretary of DHHS for the purposes of determining compliance with the HIPAA regulations upon request. The date of disclosure Safeguards – The Pharmacy agrees to use administrative, physical, and technical safeguards that reasonably and appropriately protect the confidentiality, integrity, and availability of the PHI that the Pharmacy creates, receives, maintains, or transmits on behalf of PBM and/or Plan. Pharmacy’s Agents – The Pharmacy agrees to ensure that any agent, including a subcontractor, to whom it provides PHI that was created, received, maintained, or transmitted on behalf of the PBM and/or Plan agrees to use reasonable and appropriate safeguards to protect the PHI. Notification of Security Incident – The Pharmacy agrees to report to the PBM within 48 hours of becoming aware of any use or disclosure of the Plan enrollee’s PHI or of any security incident of which the Pharmacy becomes aware. The Pharmacy shall implement all appropriate administrative, technical, and physical safeguards to prevent the use or disclosure of PHI other than pursuant to the terms and conditions of the Agreement, including but not limited to, confidentiality requirements in 45 CFR parts 160 and 164. The Pharmacy shall set up appropriate mechanisms to ensure minimum necessary access of its staff to PHI. Provider Manual The Pharmacy shall create and implement policies and procedures to address present and future HIPAA regulation requirements as needed to include use and disclosure of data; deidentification of data; minimum necessity access; accounting of disclosures; enrollees’ rights to amend, access, request restrictions; and the right to file a complaint. The Pharmacy shall provide an appropriate level of training to its staff and enrollees regarding HIPAA related policies, procedures, enrollee rights, and penalties prior to the HIPAA implementation deadlines and at appropriate intervals thereafter. The Pharmacy shall be allowed to use and receive PHI from the PBM and/or Plan where necessary for the management and administration of the Agreement and to carry out business operations. The Pharmacy shall be permitted to use and disclose PHI for the Pharmacy’s own legal responsibilities. The Pharmacy shall adopt the appropriate procedures and access safeguards to restrict and regulate access to and use by Pharmacy employees and other persons performing work for said Pharmacy to have only minimum necessary access to personally identifiable data within their organization. The Pharmacy shall continue to protect PHI relating to individuals who are deceased. The Pharmacy must make available PHI in accordance with 45 CFR § 164.524. The Pharmacy must make available PHI for amendment and incorporate any amendments to PHI in accordance with 45 CFR §164.526. In accordance with HIPAA regulations, the Pharmacy shall adhere, at a minimum, to the following guidelines: 2.2 The Pharmacy shall make its individually identifiable health information available to enrollees for amendment and access as specified and restricted under the HIPAA regulations. The Pharmacy shall adopt and implement policies and procedures for minimum necessary access to individually identifiable health information with its staff regarding plan administration and oversight. The Pharmacy shall adopt a mechanism for resolving any issues of non-compliance as required by law. The Pharmacy shall establish similar HIPAA trading partner and business associate agreements with its subcontractors, trading partners, and business associates. Provider Credentialing The following documents are requested and validated during the initial credentialing process: Provider State license, including state license number Provider federal Employee ID Number (EIN) Provider State Medicaid number Provider Manual Provider/Pharmacist Drug Enforcement Administration (DEA) number Certificate of Insurance Disclosure of ownership Recurring credentialing as required in the Plan contracts, or at a minimum every three years, is conducted and the following documents are requested from the Provider and validated: Provider State license, including state license number Provider federal EIN Provider State Medicaid number Provider/Pharmacist DEA number Certificate of Insurance In addition during initial Provider recruitment and recredentialing, the provider’s information will be searched through federal level data, state level data, and data available from all publishing jurisdictions in the United States for all publish disciplinary and licensing boards for all published professions within those jurisdictions. All excluded or sanctioned providers will be reviewed to determine whether any new providers for Medicaid or Medicare networks managed by Magellan are on the reviewed lists. The list will be provided by 2.3 The OIG (https://oig.hhs.gov/exclusions/exclusions_list.asp); General Services Administration (GSA) List of Parties Excluded from Federal Procurement Programs; State Medicaid Exclusions; DEA; Client Exclusions (if provided); and Numerous regulatory, licensing and registration agencies. Member Complaints Member complaints regarding specific network pharmacies are investigated fully working with the pharmacy and member. Member complaints regarding pharmacies may result in a site visit. Appropriate action is taken if any evidence of poor quality that could affect the health safety of members is found. Pharmacies may be required to submit evidence of corrective actions. 2.4 Medication Error Reporting Using Magellan’s approved form, network pharmacies shall report all medication dispensing errors to the Pharmacy Network team within 24 hours of identification of the event(s). Reports shall include any corrective actions taken and include any known outcomes. A medication error includes near misses where the error was caught before the medication(s) were dispensed to the member. Provider Manual Appropriate action is taken if any evidence of poor quality that could affect the health safety of members is found. Pharmacies may be required to submit evidence of corrective actions. 2.5 Pharmacy Dispute Process The following procedures are followed during any network pharmacy dispute of actions taken by Magellan: 1. When a pharmacy corrective action and/or termination from the Magellan Pharmacy Network is related to licensure sanctions, or ongoing government/state disbarment lists, there is no dispute allowed. a. The pharmacy may obtain and submit information related to the incident, but the termination will stand as in the notification to the pharmacy. b. Once all sanctions have been lifted, the pharmacy may reapply for network inclusion. 2. When a network pharmacy disputes any request or action from Magellan as a result of Magellan’s quality/patient safety programs, the pharmacy has the right to submit additional information, or request clarification. 3. In cases where planned actions are expedited due to the potential severity to patient safety, the pharmacy must contact Magellan immediately or prior to any action date identified in the correspondence sent to the pharmacy. a. The pharmacy’s request will be acknowledged within eight business hours of receipt. b. Magellan will provide a final written response within three business days. c. Business day equals at least nine hours a day during normal business days in the time zone for the particular service area, typically 0800 – 1900, but may vary based on client agreement. 4. For standard dispute timeframes (i.e. corrective action plans requested however no change in pharmacy privileges is under consideration), the pharmacy has seven business days to respond to Magellan’s report with a request for additional information or clarification. a. Magellan will provide a final written response within seven business days of receipt of the additional information. 5. If the pharmacy still expresses dissatisfaction with Magellan’s findings, they may submit one appeal within ten calendar days of Magellan’s last determination. a. Magellan will render a final decision within five business days of receipt of the appeal request. b. The final decision will be binding and the corrective actions requested will stand. Provider Manual 6. The Network team shall document in writing all correspondence. Copies of all correspondence shall be maintained by the Network team and incorporated in any future credentialing process as appropriate. 2.6 Pharmacy Suspension Process The following outlines Magellan’s network pharmacy suspension process: 1. When the Magellan department or other Magellan department or individual identifies any concerns or issues related to licensure sanctions, Program Integrity audits, or ongoing government/state disbarment lists, the circumstances are fully investigated and recommendations made as it relates to the status of a participating pharmacy in a Magellan network. 2. Magellan may recommend to suspend/terminate a participating pharmacy that is found to be engaged in behavior or who is practicing in a manner that a. Poses a significant risk to the health, welfare, or safety of consumers; or b. Promotes fraud and abuse. 3. Investigation of circumstances due to the potential severity to patient safety or circumstances involving licensure sanctions or status on government/state disbarment lists, are expedited. a. Licensure sanctions – immediate action taken within one business day of identification of the sanctions. b. Disbarment list reviews – immediate action taken within one business day of identification of the sanctions. c. Significant risk to the health, welfare, or safety of consumers – immediate action taken within one business day of identification of the sanctions. d. Fraud and abuse – within three business days of final confirmed findings from Program Integrity or other auditing processes. e. For all other situations such as potential trends identified through the ongoing quality monitoring program – within 10 business days of final review and analysis of all available data and recommendations from the Chief Medical Officer (CMO) and/or QI Committee (QIC). 4. Pharmacies are provided access to a disputes resolution process. 5. The Network team shall document in writing all correspondence. Copies of all correspondence shall be maintained by the Network team and incorporated in any future credentialing process as appropriate. 6. When a decision has been made to suspend/terminate a pharmacy from the participating network, the following steps are taken: Provider Manual a. The pharmacy is notified in writing of the actions being taken and the rationale. b. As appropriate to the situation, additional verbal notification will be made. c. Appropriate coding changes to the Pharmacy Network tables are made to ensure no additional claims are processed during any suspension and/or following termination. d. The Member Web Portal tables for the Find a Pharmacy functionality are updated with any pharmacy network changes. e. A notice is posted to all member Web portals, noting the change in the pharmacy network. f. A claims review history is run to obtain all active member claims for the impacted pharmacy and members are contacted, offered assistance to locate a new pharmacy, and facilitate transfer of any active prescriptions. 7. While the steps outlined above may involve the work of a number of departments, the overall responsibility rests with the Network team. Provider Manual 3.0 3.1 Billing Information Claim Formats and Plan – Specific Values Pharmacy claims may be submitted online by POS (POS) or paper using the following National Council for Prescription Drug Programs (NCPDP) standards: 3.2 POS: NCPDP Version D.0 Batch: NCPDP Batch 1.2 (contact the Magellan EDI Help Desk at 1-800-924-6741) Paper: Claims submitted (after the fact). Refer to Section 5.1 – Claim Format for further details on acceptable claim formats and specifications. Magellan Website Pharmacy Portal Announcements, provider forms, drug information, provider manuals, Medicaid policies, and bulletins will be posted on the Magellan website from time to time at https://mhs.magellanpharmacysolutions.com/pharmacy. Provider Manual 4.0 Magellan Services Call Center Magellan has a Pharmacy Support Center, Clinical Support Center, and Web Support Call Center to assist pharmacies, prescribers, and members. 4.1 Pharmacy Support Center 1-800-651-8921 (Nationwide Toll-Free Number); option 4, option 2, then option 3 for Pharmacy Magellan provides a toll-free number for pharmacies available 7 days a week, 24 hours a day, and 365 days a year. The Pharmacy Support Center responds to questions on coverage, claims processing, and Plan eligibility. Examples of issues addressed by the Pharmacy Support Center staff include, but are not limited to, the following: 4.2 Questions on Claims Processing Messages – If a pharmacy needs assistance with alert or denial messages, it is important to contact the Pharmacy Support Center at the time of dispensing drugs. Magellan’s staff is able to provide claim information on all error messages, including messaging from the ProDUR system. Clinical Issues – The Pharmacy Support Center is not intended to be used as a clinical consulting service, and cannot replace or supplement the professional judgment of the dispensing pharmacist. However, a second level of assistance is available if a pharmacist’s question requires a clinical response. To address these situations, the Clinical Support Call Center will provide assistance with initiating clinical prior authorizations (PAs). Clinical Support Call Center 1-800-651-8921 (Nationwide Toll-Free Number); option 4, option 2, then option 2 for Prescriber 1-888-272-1349 (Fax) Magellan provides a toll-free number for prescribers available 7 days a week, 24 hours a day, and 365 days a year. The Clinical Support Center responds to questions about clinical PAs. 4.3 Web Support Call Center 1-800-651-8921 (Nationwide Toll-Free Number); option 3 for Web support Magellan provides a toll-free number for providers. This toll-free line is staffed Monday–Friday, 8:00 a.m.–8:00 p.m., Eastern Time (ET). The Web Support Call Center responds to questions concerning access to various Web applications, password management, navigation, and general questions. Provider Manual Examples of issues addressed by the Web Support Call Center staff include, but are not limited to, the following: Questions on changing passwords in the User Administration Console (UAC) – If providers need assistance with changing their passwords or are if they are getting an alert that their password is locked out. Questions on navigating the various web applications – If providers need assistance in navigating through various web applications, the Web Support Call Center can assist by explaining how to access the applications, log in, and maneuver the systems. Provider Manual 5.0 Program Setup 5.1 Claim Format While Magellan strongly recommends claims submission by POS, paper claims, batch, and Web claims submission are also allowed. The following standard formats are accepted. Each is explained in subsequent sections. Table 5.1.1 – Claim Formats Accepted by Magellan Billing Media NCPDP Version Comments POS Version D.0 Online POS and web claims submission is preferred. Batch NCPDP Batch 1.2 Contact Magellan with questions in regards to processing batch claims. Paper Claims Universal Claim Form (D.0 UCF) Web Claims Submission 5.2 NCPDP D.0 PUCF_D02PT for Standard Version D.0 Point-of-Sale – NCPDP Version D.0 As part of claims processing, Magellan uses an online POS system to provide submitters with realtime online information regarding Plan eligibility; Drug coverage; Dispensing limits; Pricing; Payment information; and ProDUR. The POS system is used in conjunction with a pharmacy’s in-house operating system. While there are a variety of different pharmacy operating systems, the information contained in this manual specifies only the response messages related to the interactions with the Magellan online system and not the technical operation of a pharmacy’s in-house-specific system. Pharmacies should check with their software vendors to ensure their system is able to process as per the payer specifications listed in Section 10.0 – Appendix A – Plan D.0 Payer Specifications of this manual. 5.2.1 Supported POS Transaction Types Magellan has implemented the following NCPDP Version D.0 transaction types. A pharmacy’s ability to use these transaction types depends on its software. At a minimum, pharmacies should Provider Manual have the capability to submit original claims (B1), reversals (B2), and re-bills (B3). Other transactions listed in Table 5.2.1.1 – NCPDP Version D.0 Transaction Types Supported are also supported. Original Claims Adjudication (B1) – This transaction captures and processes the claim and returns the dollar amount allowed under the program’s reimbursement formula. The B1 transaction is the prevalent transaction used by pharmacies. Claims Reversal (B2) – This transaction is used by a pharmacy to cancel a claim that was previously processed. To submit a reversal, a pharmacy must void a claim that has received a PAID status and select the REVERSAL (Void) option in its computer system. Claims Re-Bill (B3) – This transaction is used by the pharmacy to adjust and resubmit a claim that has received a PAID status. A “claim re-bill” voids the original claim and resubmits the claim within a single transaction. The B3 claim is identical in format to the B1 claim with the only difference being that the transaction code (Field # 1Ø3) is equal to B3. The following fields must match the original paid claim for a successful transmission of a B2 (Reversal) or B3 (Re-bill): Service Provider ID – NPI Number Prescription Number Date of Service (Date Filled) National Drug Code (NDC) Table 5.2.1.1 – NCPDP Version D.0 Transaction Types Supported NCPDP D.0 Transaction Code Transaction Name B1 Billing B3 Re-bill B2 Reversal E1 5.2.2 Required Data Elements Eligibility Inquiry A software vendor needs Magellan’s payer specifications to set up a pharmacy’s computer system to allow access to the required fields and to process claims. The Magellan Claims Processing system has program-specific field requirements; e.g., Mandatory, Situational, and Not Required. Table 5.2.2.1 – Definitions of Field Requirements Indicators Used in Payer Specifications lists abbreviations that are used throughout the payer specifications to depict field requirements. Table 5.2.2.1 – Definitions of Field Requirements Indicators Used In Payer Specifications Code M Description MANDATORY Designated as MANDATORY in accordance with the NCPDP Telecommunication Provider Manual Code Description Implementation Guide Version D.0. The fields must be sent if the segment is required for the transaction. R REQUIRED Fields with this designation according to this program’s specifications must be sent if the segment is required for the transaction. RW QUALIFIED REQUIREMENT “Required when” the situations designated have qualifications for usage (“Required if x,” “Not required if y”). Claims are not processed without all of the required (or mandatory) data elements. Required (or mandatory) fields may or may not be used in the adjudication process. Also, fields not required at this time may be required at a future date. Claims are edited for valid format and valid values on fields that are not required. If data are submitted in fields not required for processing as indicated by the payer specifications, the data are subjected to valid format/valid value checks. Failure to pass those checks result in claim denials. Required Segments – The transaction types implemented by Magellan have NCPDP-defined request formats or segments. Table 5.2.2.2 – Segments Supported for B1, B2, and B3 Transaction Types lists NCPDP segments used. Table 5.2.2.2 – Segments Supported for B1, B2, and B3 Transaction Types Transaction Type Codes Segment B1 B2 B3 Header M M M Insurance M S M Pharmacy Provider S N S Patient Claim S S S M M Prescriber M S M Worker’s Comp S N S COB/Other Payments DUR/PPS S N S S Pricing M Compound S Coupon Prior Authorizations M S S S M N S S N S N S S Provider Manual Transaction Type Codes Segment Clinical Facility M = Mandatory S = Situational B1 B2 B3 S N S S N N = Not Used S Payer Specifications – A list of transaction types and their field requirements is available in Section 10.0 – Appendix A – Plan D.0 Payer Specifications. These specifications list B1 and B3 transaction types with their segments, fields, field requirement indicators (mandatory, situational, optional), and values supported by Magellan. Program Setup – Table 5.2.2.3 – Important Required Values for Program Set Up lists required values unique to Plan programs. Table 5.2.2.3 – Important Required Values for Program Set Up Fields Description Comments BIN# Processor Control # Group PLAN Cardholder ID # Plan Assigned Number Provider ID # Prescriber ID # Product Code NPI 10 bytes (numeric) NPI number 10 bytes (numeric) An algorithm validation will be performed to verify NPI is valid. National Drug Code (NDC) Up to 20 bytes (numeric) 11 digits Provider Manual 5.3 Paper Claims All paper pharmacy claims must be submitted to Magellan on a Universal Claim Form (UCF, version PUCF_D02PT) to the following address unless noted on the member ID card or other Plan documentation provided by the member. Magellan Health Services Attn: Paper Claims Department Post Office Box 85042 Richmond, VA 23261-5042 Information is available at http://www.ncpdp.org/products.aspx regarding the UCF. Provider Manual 6.0 6.1 Service Support Online Certification The Software Vendor/Certification Number (NCPDP Field # 11Ø-AK) of the Transaction Header Segment is required for claims submission under NCPDP Version D.0; providers should submit the value that is assigned to them when being certified. Magellan certifies software vendors, not an individual pharmacy’s computer system. A pharmacy should contact its vendor or Magellan to determine if the required certification has been obtained. For assistance with software vendor certification, contact Magellan. Refer to Section 1.2 – Contact Information for other contact information. 6.2 Solving Technical Problems Pharmacies receive one of the following messages when the Magellan POS system is unavailable (see Table 6.2.1 – Host System Problem Messages and Explanations): Table 6.2.1 – Host System Problem Messages and Explanations NCPDP Message Explanation 90 Host Hung Up Host disconnected before session completed. 93 Planned Unavailable Transmission occurred during scheduled downtime. Scheduled downtime for file maintenance is Saturday, 11:00 p.m., ET–Sunday, 6:00 a.m., ET. 92 99 System Unavailable/Host Unavailable Host Processing Error Processing host did not accept transaction or did not respond within time out period. Do not retransmit claims. Magellan strongly recommends that a pharmacy’s software has the capability to submit backdated claims. Occasionally, a pharmacy may also receive messages that indicate its own network is having problems communicating with Magellan. If this occurs, or if a pharmacy is experiencing technical difficulties connecting with the Magellan system, pharmacies should follow the steps outlined below: 1. Check the terminal and communication equipment to ensure that electrical power and telephone services are operational. 2. Call the telephone number that the modem is dialing and note the information heard (i.e., fast busy, steady busy, recorded message). 3. Contact the software vendor if unable to access this information in the system. 4. If the pharmacy has an internal technical staff, forward the problem to that department, then the internal technical staff should contact Magellan to resolve the problem. Provider Manual 5. If unable to resolve the problem after following the steps outlined above, directly contact the Magellan Pharmacy Support Center. Refer to Section 1.2 – Contact Information for contact information. Provider Manual 7.0 7.1 Online Claims Processing Edits Paid, Denied, and Rejected Responses After an online claim submission is made by a pharmacy, the POS system returns a message to indicate the outcome of the processing. If the claim passes all edits, a PAID message is returned with the allowed reimbursement amount. A claim that fails an edit and is REJECTED (or DENIED) also returns with an NCPDP rejection code and message. Refer to Section 11.0 – Appendix B – Pointof-Sale Reject Codes and Messages for a list of POS rejection codes and messages. 7.2 Duplicate Response A duplicate disposition occurs when there is an attempt to submit a claim that has already gone through the adjudication process with either some or all of the previous claims information. An exact match on the following fields results in a duplicate disposition: Same Patient/Member Same Service Provider ID Same Date of Service Same Product/Service ID Same Prescription/Service Reference Number Same Fill Number In situations where there are matches on some of the above data elements, Magellan returns an NCPDP Error Code # 83 – Duplicate Paid Claim to indicate a possible suspected duplicate. There are situations where the provider sends the transaction request and Magellan receives the request and processes the transaction. Then, due to communication problems or interruptions, the response is not received by the provider. In these cases, the provider should resubmit the transaction request. Magellan responds with the same information as the first response, but the transaction response is marked as duplicate. Provider Manual 8.0 Program Specifications 8.1 Timely Filing Limits Most pharmacies that utilize the POS system submit their claims at the time of dispensing the drugs. However, there may be mitigating reasons that require a claim to be submitted retroactively. 8.2 For all original claims and adjustments, the timely filing limit is 366 days from the date of service (DOS). For reversal transactions, the filing limit is unlimited. Claims that exceed the prescribed timely filing limit will deny and return NCPDP error code – 81“Timely Filing Exceeded”. Requests for overrides on claims and adjustments billed past the timely filing limits of 366 days or more, the pharmacy must contact Plan for consideration. Providers should contact the Pharmacy Support Center at 1-800-651-8921. Mandatory Generic Requirements The Magellan Plan may have a mandatory generic program where: Multi-source brand products submitted with a DAW code of ‘1,’ Physician requested brand be dispensed (Physician writes “Dispense as Written” on Rx when there is a generic equivalent available) may require a prior authorization to bypass the MAC pricing. Member may have to pay the cost difference between the brand rates versus the generic rate, plan option. Multi-source brand products submitted with a DAW code of ‘2,’ Member requests brand be dispensed. Member may have to pay the cost difference between the brand rates versus the generic rate, plan option. Exceptions to the mandatory generic policy may exist where Magellan prefers a brand product over a generic. Enrollees are not charged their brand co-pay. For a current detailed listing of these drugs, please see the Branded Drugs Classified as Generics list on the Magellan website at http://magellanhealthpharmacy.com. 8.3 Dispensing Limits/Claim Restrictions The Magellan Plan may have dispensing limits/claim restrictions. Please review the reject responses on the claim and contact the Pharmacy Support Center if further information is needed at 1-800-651-8921. Provider Manual 8.3.1 Days’ Supply The standard days’ supply maximum is defined by the Plan. The Plan may allow for up to a 102-day supply at retail. Pharmacy must be participating in the Magellan 90-day at retail network to participate. If pharmacy received a reject for days’ supply, please contact the Pharmacy Support Center at 1-800-651-8921 or refer to the Magellan website at https://mhs.magellanpharmacysolutions.com/pharmacy to request a contract for participation. 8.3.2 Quantity 8.3.2.1 Minimum or Maximum Quantity Limits, Quantity Per Day, Quantity Over Time, and Maximum Daily Dose. All quantity limits are established by the Plan or plan specific. Please refer to the specific reject response or contact the Pharmacy Support Center for assistance at 1-800-651-8921. 8.3.3 Dollar Limit All dollar limits are established by the Plan. Please refer to the specific reject response or contact the Pharmacy Support Center for assistance at 1-800-651-8921. 8.3.4 Minimum/Maximum Age Limits All Age limits are established by the Plan. Please refer to the specific reject response or contact the Pharmacy Support Center for assistance at 1-800-651-8921. 8.3.5 8.4 Refills DEA = 0: Original plus up to 99 refills within 366 days from original Date Rx Written DEA = 2: No refills DEA = 3–5: Original plus 5 refills within 183 days from original Date Rx Written 8.4.1 Provider Reimbursement Provider Reimbursement Rates Provider Reimbursement rates including dispense fees, compounding fees, specialty drug reimbursement rates, or LTC rates are established by the specific fee schedules agreed to within the Magellan Health Services Participating Pharmacy Agreement, which may be renegotiated or added to from time to time. Please refer to your signed pharmacy agreement or contact the Magellan Pharmacy Networks Department at RxNetworksDept@MagellanHealth.com for a copy of most recent pharmacy contract or refer to https://mhs.magellanpharmacysolutions.com/pharmacy. Provider Manual 8.5 Plan Co-Pays The Plan determines their own co-pay structure for all categories of medications, including but not limited to Preferred Brand; Non-Preferred Brand; Generic; and Specialty Medications. Please refer member to their Plan documents, member portal, or the paid claim response for applicable co-pay. 8.6 Prior Authorizations 8.6.1 Clinical PAs The Magellan Clinical Call Center will receive PA requests for products that have clinical edits for the Magellan program. PA request(s) are made by the prescribing physician or the prescribing physician’s agent. Requests may be initiated by telephone, fax, mail, or WebPA. 8.6.2 Emergency Protocols The Plan pays for a 72-hour emergency supply of medications that require a clinical PA (formulary edits do not qualify) if a PA request has not been processed and it is after hours, a weekend, or a designated holiday. An example of when this may occur is when the prescriber is unavailable to provide sufficient information required to complete the prior authorization. The appropriate PA process must be utilized during regular business hours. All of the following conditions must be met for an emergency supply: The participant is Plan-eligible on the date of service. The medication requires clinical PA (Formulary edits do not qualify). The medication is not an excluded product for the Plan. The days’ supply for the emergency period does not exceed three days. 8.6.3.1 Emergency Supply Override Process Claim denied for requiring a clinical PA. Non Formulary medications do not qualify. The dispensing pharmacist should determine if an immediate threat of severe adverse consequences exists should the patient not receive an emergency supply. Provider Manual In the dispensing pharmacist’s judgment, if the dispensing of an emergency supply is warranted, determine the appropriate amount for a three-day supply. For unbreakable packages, the full package can be dispensed. Resubmit the adjusted claim to Magellan, including both a Prior Authorization Type Code of “8” (NCPDP Field # 461-EU) and Prior Authorization Number NCPDP Field # 462-EV of “88888888888” to override the POS denial. 8.6.3.2 The enrollee is not charged a co-pay for the emergency supply. Only one emergency supply is provided per drug (HSN) per member per year. Recipients are not permitted to receive, nor will Plan pay for the remainder of the original prescription at any pharmacy unless the prescriber has received a clinical PA. Pharmacy Override Summary Table 8.6.3.2.1 – Pharmacy Override Summary Pharmacy Override Summary Override Type Override NCPDP Field Code Emergency 3-Day Supply of Formulary Prior Authorization Type Code Products requiring clinical edit. (Field # 461-EU) 8 Filling the Remainder of an Emergency Submission clarification Code 3-Day Supply after a PA is obtained (NCPDP Field # 42Ø-DK) 5 Prior Authorization Number (Field # 462-EV) Hospice Patient Pregnant Patient Eleven 8s Patient Residence Field (NCPDP 11 Field # 384-4X) Pregnancy Indicator Field (NCPDP Field # 335-2C) 2 Provider Manual 8.6.4 Preferred Drug List (PDL)/PA/Quantity/Duration Lists All claims are interrogated against the Preferred Drug List (PDL), benefit requirements, and DUR criteria. A complete listing of PA criteria, step therapy requirements, quantity limits, and duration of therapy edits may be requested on the Magellan website at https://mhs.magellanpharmacysolutions.com/pharmacy/common/source/contact_us.shtml All claims are interrogated for compliance with state and federal requirements. Prescriptions must be dispensed pursuant to the orders of a physician or legally authorized prescriber. Any subsequent refills may be dispensed not more than one year from the date the prescription was written (or earlier whenever legally dictated). CIIs may not be refilled; a new prescription is required for each fill. Controlled drugs other than CIIs may be refilled, pursuant to the order of a physician or legally authorized prescriber, up to five refills or six months, whichever comes first. Non-controlled drugs may be refilled, pursuant to the order of a physician or legally authorized prescriber, up to one year. Provider Manual 8.7 ProDUR Drug Utilization Review (ProDUR) ProDUR encompasses the detection, evaluation, and counseling components of pre-dispensing drug therapy screening. The ProDUR system of Magellan assists in these functions by addressing situations in which potential drug problems may exist. ProDUR performed prior to dispensing assists the pharmacists to ensure that their patients receive the appropriate medications. Because the Magellan ProDUR system examines claims from all participating pharmacies, drugs that interact or are affected by previously dispensed medications can be detected. Magellan recognizes that the pharmacists use their education and professional judgments in all aspects of dispensing. 8.7.1 Drug Utilization Review (DUR) Edits The following ProDUR edits will deny for the Plan: Early Refill (ER) Non-controlled Products Early Refill Tolerance: 75–85 percent For non-controlled products, the system will automatically check for an increase in dose and when an increase in dosage is detected, the system will not deny the current claim for early refill. Controlled Products Early Refill Tolerance: 85–95 percent The Call Center may assist in overriding this reject if one of the following circumstances exists: Dosage/Therapy change has occurred Patient is no longer taking the original dosage Dosage Time/Frequency Change has occurred Two strengths of the same drug are used to make strength of that medication not currently manufactured Therapeutic Duplication ProDUR edits involving: Narcotic Analgesics, Sedative Hypnotics, Benzodiazepines, or Skeletal Muscle Relaxants require a telephone call to the Pharmacy Support Center to obtain an override. Minimum/Maximum Daily Dosing (LD, HD) High Dose HD Only – tolerance at 225 percent Drug-to-Gender (SX) Severity level 1 interaction will deny and require a call to the Pharmacy Support Center for override consideration. Severity level 2 interactions will return ProDUR message. Provider Manual Drug-to-Pregnancy Precautions (PG) Drug to Geriatric Precautions (PA) Drug to Pediatric Precautions (PA) 8.7.2 ProDUR Overrides The following are the NCPDP interactive Professional Service, Result of Service, Reason for Service, and Submission Clarification codes. These codes may be used to override ProDUR denials at the POS. Problem/Conflict Type: The following override codes may be used by providers in any condition where a provider-level override is allowed for ProDUR denials. Professional Service Codes Allowed for Submission Professional Service Code/Description All codes are Select one: allowed for all AS/Patient conflict types. Assessment CC/Coordination of Care DE/Dosing Evaluation/ Determination FE/Formulary Enforcement GP/Generic Product Selection M0/Prescriber Consulted MA/Medication Administration MR/Medication Review PH/Patient Medication History PM/Patient Monitoring P0/Patient Result of Service Codes Allowed for Submission Submission Clarification Reason for Code/Description Service Code (Listed as reference only, not required on claims) Result of Service Code/Description All codes are Select one: allowed for 1A/filled as is, all conflict false positive types. 1B/filled prescription as is 1C/filled, with different dose 1D/filled, different direction 1E/filled, with different drug 1F/filled, different quantity 1G/filled, Prescriber approved 1H/brand,-togeneric change 1J/Rx-to OTC change 1K/filled, ER DD TD SX Select one: 01/No Override 02/Other Override 03/Vacation supply 04/Lost prescription 05/Therapy change 06/Starter Dose 07/Medically necessary Provider Manual Professional Service Codes Allowed for Submission Professional Service Code/Description Consulted PE/Patient Education/Instru ction PT/Perform Laboratory Test RO/Physician Consulted Other Source RT/ Recommended Laboratory Tests SC/Self Care Consultation SW/Literature Search/Review TC/Payer/Proces sor Consulted TH/Therapeutic Product Interchange Result of Service Codes Allowed for Submission Result of Service Code/Description different dosage form 2A/ prescription not filled 2B/not filled – direction clarified 3A/ recommendatio n accepted 3B/ recommendatio n not accepted 3C/discontinue d drug 3D/regimen changed 3E/therapy changed 3F/therapy chg –cost inc accepted 3G/drug therapy unchanged 3H/follow-up report 3J/Patient referral 3K/ instructions understood 3M/compliance aid provided 3N/medication administered Submission Clarification Reason for Code/Description Service Code (Listed as reference only, not required on claims) All ProDUR alert messages appear at the end of the claims adjudication transmission. Provider Manual Alerts appear in the following format: Format Field Definitions Reason for Service Up to three characters. Code transmitted to pharmacy when a conflict is detected (e.g., ER, HD, TD, DD). Other Pharmacy Indicator One character. Indicates if the dispensing provider also dispensed the first drug in question. Severity Index Code One character. Code indicates how critical a given conflict is. Previous Date of Fill Quantity of Previous Fill Database Indicator Other Prescriber 1 = Your Pharmacy 3 = Other Pharmacy Eight characters. Indicates previous fill date of conflicting drug in YYYY/MM/DD format. Five characters Indicates quantity of conflicting drug previously dispensed. One character. Indicates source of ProDUR message. 1 = First DataBank 4 = Processor Developed One character. Indicates the prescriber of conflicting prescription. 0 = No Value 1 = Same Prescriber 2 = Other Prescriber Provider Manual 8.8 Retro DUR All standard retrospective DUR (RetroDUR) programs adhere to current standards of drug-based screening elements for medications that have limited clinical documentation supporting combination use, carry high risk warnings for concomitant drug therapy, identify overuse, identify underuse or sub-therapeutic dosing of medication, suggest possible fraud, and abuse potential or offer other opportunities to improve patient care. The Magellan RetroDUR systems logic identifies and profiles members, pharmacy providers, prescribers, and disease states. Program‐specific historical data are used to identify trends of interest and variables that can be used as reliable predictors of subsequent outcomes. After interventions are made to either pharmacy providers or prescribers, follow‐up ensures that members receive quality care, as well as cost‐effective and therapeutically‐sound treatment. Magellan clinical staff detects therapeutically inappropriate treatment trends that are then targeted for intervention. Magellan’s RetroDUR programs include the standard member exceptionbased program, as well as pharmacy provider, prescriber, and disease state profiling. The RetroDUR system is supported by a fully integrated data warehouse of both pharmacy and medical data, including diagnosis, procedure, hospital, and laboratory claims data when available. Criteria are revised as therapeutic problems are identified and/or eliminated and new drug products are released. The program promotes therapeutic appropriateness of medications by checking for, but not limited to, early refills, brand versus generic utilization, drug-to-drug interactions, and therapeutic duplication. These RetroDUR edits detect potential adverse drug consequences of incorrect drug utilization. The RetroDUR system detects excessive use of medication and insufficient daily doses by comparing drugs selected for review to the submitted daily doses and the duration of therapy. This RetroDUR edit detects errors in dosage and duration and also monitors member compliance. Clinical abuse/misuse can be determined so that remedial strategies can be introduced to improve quality of care and conserve program funds. Magellan’s standard Therapeutic Criteria Catalogue contains medically-accepted standards of practice that have been identified and are continually updated to reflect current medical literature. The criteria are designed to reduce the incidence of drug therapy failure and drug-induced illness. The system detects drug-to-diagnosis contraindications, treatment failure, adverse reactions, and iatrogenic effects by evaluating drug, diagnostic, and laboratory procedural information, when available. Other factors, such as the patient’s age, gender, location, co-morbidities, and those members receiving mental health and/or substance abuse treatment, are also incorporated into criteria as medically relevant. Magellan also has the ability to develop criteria that look for opportunities to improve adherence to established and new evidence-based guidelines — for example, a criterion that looks for members with diabetes who could benefit from initiation of an angiotensin converting enzyme inhibitor (ACEI) to reduce the risk of diabetic complications. Confidential and Proprietary Page 43 Provider Manual The appropriate medical references are documented for each therapeutic criterion. When new criteria are developed, the information regarding approved dosage forms, approved indications, doses, duration of therapy, adverse reactions, and drug interactions is collected and carefully evaluated. These criteria are translated into sophisticated computer algorithms and entered into the Therapeutic Criteria Catalogue for additional analysis by team members. Extensive automated testing is then performed using broad patient populations. The resulting exception profiles are then evaluated, and changes are made as necessary. Magellan will use these tools to evaluate the level and quality of care provided to the program’s members and to identify possible overpayment as a result of inappropriate utilization. Magellan’s DUR Program shall include policies and/or procedures that address criteria for Identifying the drug use that is outside the standard of practice; Evaluating the available drug submission data; Comparing between optimal (based on best available science)/appropriate and actual use in order to address discrepancies; Coordinating intervention when treatment alternatives are warranted; and Evaluating the effectiveness of the drug utilization management program; and Timeliness of the reviews; Disclosure of the clinical oversight process to the Plans; and 8.9 Disclosure of the clinical oversight process to prescribers, upon request. Special Participant Conditions 8.9.1 Lock-In A member may be locked in to a prescriber, pharmacy provider, or both; the Plan guidelines will vary. Refer to the rejection code on the claim and contact the Pharmacy Support Center at 1-800651-8921. Enrollees may be locked into a designated pharmacy. Claims submitted for these individuals will deny NCPDP EC 50 – “Non-matched Pharmacy Number” with an additional supplemental message when the claim is submitted by an unauthorized pharmacy. In the event of an emergency, contact the Magellan Pharmacy Support Center for override consideration. 8.10 Compound Claims All compounds must be submitted using the NCPDP version D.0 standard multi-ingredient compound functionality. Therefore, all ingredients must be identified, their units must be indicated, and the ingredient cost for each ingredient must be submitted on the claim. At least one item in the compound must be a covered drug. If an excluded or non-PDL agent is included in the compound, the claim will reject for “invalid compound.” The pharmacy may place an 8 in the Page 44 Magellan Health Services Provider Manual submission clarification code field and resubmit the claim; however, be advised that any component of a compound requiring a PA will necessitate an approval prior to receiving payment from the Plan Pharmacy Program. Important Notes: The Claim Segment Product ID (i.e., National Drug Code [NDC]) is defined as a mandatory field and, therefore, must be submitted for all claims, including multi-ingredient compounds. A non-blank space value is expected in the Claim Segment Product ID field for field validation. The pharmacy submits a single zero in this field for a multi-ingredient compound. For compound segment transactions, the claim is rejected if a single zero is not submitted as the Product ID. A Submission Clarification Code value of “8” only allows a claim to continue processing if at least one ingredient is covered. Non-rebateable ingredients will process with the submission clarification code; but only rebateable ingredients are eligible for reimbursement. The Compound Type, NCPDP Field # 996-G1, is required to be submitted on all compound claims. If this field is not submitted, the claim will reject. Each multi-ingredient compound claim counts as one claim towards the Brand Rx fill limits, if applicable. Pharmacies must transmit the same NDC numbers that are being used to dispense the medication. If total cost is not equal to the sum of the ingredients’ cost, the claim will deny. Multiple instances of an NDC within a compound will not be allowed. Duplicate edits are applied regardless of the compound status of the claim. Confidential and Proprietary Page 45 Provider Manual 8.10.1 Fields Required for Submitting Multi-Ingredient Compounds On Claim Segment Enter Compound Code (NCPDP Field # 4Ø6-D6) of “2.” Enter Product Code/NDC (NCPDP Field # 4Ø7-D7) as “0” on the claim segment to identify the claim as a multi-ingredient compound. Enter Product/Service ID Qualifier (NCPDP Field # 436-E1) as “00” to identify the product as a multi-ingredient compound. Enter Quantity Dispensed (NCPDP Field # 442-E7) of entire product. Enter Gross Amount Due (NCPDP Field # 43Ø-DU) for entire product. Submission Clarification Code (NCPDP Field # 42Ø-DK) = Value “8” will only be permitted for POS (not valid for paper claims) and should be used only for compounds. On Compound Segment Compound Dosage Form Description Code (NCPDP Field # 45Ø-EF) Compound Dispensing Unit Form Indicator (NCPCP Field # 451-EG) Compound Route Of Administration (NCPCP Field # 452-EH) Compound Ingredient Component Count (NCPCP Field # 447-EC) (Maximum of 25) For Each Line Item Compound Product ID Qualifier (NCPCP Field # 488-RE) of “00” Compound Product ID (NCPDP Field # 489-TE) Compound Ingredient Quantity (NCPDP Field # 448-ED) Compound Ingredient Cost (NCPDP Field # 449-EE) 8.11 Partial Fills In those cases where a pharmacy provider does not dispense the full amount per the prescriber’s directions because of a drug shortage, the pharmacy provider should submit the claim as a partial fill and indicate as such on the claim transaction. Standard NCPDP fields required for partial fills will be supported and required. The dispense fee will be paid on the initial fill The co-payment, if applicable, will be collected on the initial fill. Refer to the Payer Specification document on the Magellan website at https://mhs.magellanpharmacysolutions.com/pharmacy for specific requirements of the program. Page 46 Magellan Health Services Provider Manual 9.0 Coordination of Benefits (COB) Typically, the Magellan Plan is the primary payer. In the event they are the secondary payer, please follow the subsequent guidelines. Coordination of benefits is the mechanism used to designate the order in which multiple carriers are responsible for benefit payments, and thus, prevention of duplicate payments. Third-party liability (TPL) refers to An insurance plan or carrier; A program; and A commercial carrier. The plan or carrier can be An individual; A group; Employer-related; Self-insured; and A self-funded plan. The program can be Medicare, which has liability for all or part of an enrollee’s medical or pharmacy coverage. The terms third-party liability and other insurance are used interchangeably to mean any source other than the Plan that has a financial obligation for health care coverage. 9.1 COB General Instructions 9.1.1 COB Process The Magellan COB process does require a match on Other Payer ID and submission of the Other Payer Date. Online COB (cost avoidance) is required. COB edits will be applied when TPL exists for the enrollee and claim DOS. The Plan is always the payer of last resort. Providers must bill all other payers first and then bill the Plan. This requirement also applies to compounds. COB processing requires that the Other Payer Amount Paid, Other Payer ID, Other Payer Date, and Other Payer Patient Responsibility be submitted on the claim to the Plan. Pharmacy providers are asked to submit the TPL carrier code when coordinating claims for payment with a primary payer. Confidential and Proprietary Page 47 Provider Manual System returns Other Payer details in “COB Response Segment” (items returned are subject to information received on the recipients COB records): Other Payer Coverage Type Other Payer ID Qualifier Other Payer ID Other Payer Processor Control Number Other Payer Cardholder ID Other Payer Group ID Other Payer Person Code Other Payer Help Desk Phone Number Other Payer Patient Relationship Code Other Payer Benefit Effective Date Other Payer Benefit Termination Date Reimbursement will be calculated to pay the lesser of the Plan allowed amount or the Other Payer Patient Responsibility as reported by the primary carrier, less the thirdparty payment. Plan co-payments will also be deducted for participants subject to Plan co-pay. In some cases, this may result in the claim billed to the Plan being paid at $0.00. Note: Magellan will not send a negative amount in the Amount Paid field if the TPL and copayment are greater than the Plan allowable. Co-pay Only Claims, Other Coverage Code = 8, are not allowed. Refer to the Payer Specification document on the Magellan website at https://mhs.magellanpharmacysolutions.com/pharmacy for specific requirements of the program. Following are values and claim dispositions based on pharmacist submission of the standard NCPDP TPL codes. Where applicable, it has been noted which Other Coverage Code (NCPDP Field # 308-C8) should be used based on the error codes received from the primary. Page 48 Magellan Health Services Provider Manual Table 9.1.1.1 – TPL Codes NCPDP Field #308-C8 O – Not Specified 1 – No Other Coverage When to Use OCC 0 is allowed; submit when member does not have TPL. Submission Requirements/Responses Claim will reject with a 41 error if member record has TPL. Additional fields in the NCPDP COB segment should not be submitted with this OCC. Claim should be submitted to TPL and then resubmitted with proper OCC and COB required fields. OCC 1 is allowed; This code can be used when the pharmacy cannot determine the valid TPL identity. 2 – Exists Payment Collected OCC 2 is used when any positive amount of money is collected from another payer. Submit the amount collected from the primary payer (TPL), along with the date the claim was adjudicated to the primary payer (TPL) in order override the TPL denial. Additional fields in the NCPDP COB segment should not be submitted with this OCC. Claim should be submitted to TPL and then resubmitted to the Plan with proper OCC and COB required fields. Verify TPL information provided. When the enrollee has TPL on file and the OCC 1 is submitted, the claim will continue to reject for NCPDP 41. Paid claim and completed COB segment inclusive of the following fields: Other Payer Amount Paid (Field # 431-DV) that is > $0 Other Payer Amount Paid Qualifier (Field # 342HC) must be a valid value Other Payer-Patient Responsibility Amount Submitted (Field # 352-NQ) if >/= $0 Other Payer Date (Field # 443-E8) that is compliant with timely filing. Other Payer ID (Field # 340-7C) that is valid Other Payer ID Qualifier (Field # 339-6C) that is valid Claims submitted without required COB fields will reject with NCPDP code 13 or other specific reject codes Confidential and Proprietary Page 49 Provider Manual NCPDP Field #308-C8 When to Use 3 – Exists Claim Not Covered OCC 3 is used when the Plan beneficiary has TPL, but the particular drug is not covered by the specific plan(s). 4 – Exists Payment Not Collected OCC 4 is used when a patient’s TPL is active, but there is no payment collected from the primary insurer (i.e., the beneficiary has not met their primary payer’s deductible obligation, plan capitation, etc.). OCC 4 should also be used if the total cost of the claim is less than the patient’s TPL co-pay requirement and the primary insurance plan made no payment. Submission Requirements/Responses Requires submission of: Other Payer Date (Field # 443-E8) Other Payer ID (Field # 340-7C) Other Payer ID Qualifier (Field # 339-6C) And the reject code generated after billing the other insurer(s) in the “Other Payer Reject Code (472-6E). Claim will pay only if the following Other Payer Reject codes are submitted: 60, 61, 63, 65, 66, 67, 68, 69, 70, 3Y Claims submitted without required COB fields will reject with NCPDP code 13 or other specific reject codes Paid claim; also requires submission of: Other Payer Amount Paid (Field # 431-DV) that = $0 Other Payer Amount Paid Qualifier (Field # 342HC) Other Payer-Patient Responsibility Amount Submitted (Field # 352-NQ) this is = $0 Other Payer Date (Field # 443-E8) that is valid Other Payer ID (Field # 340-7C) that is valid Other Payer ID Qualifier (Field # 339-6C) Claims submitted without required COB fields will reject with NCPDP code 13 or other specific reject codes 8 – Claim Billing for a Co-pay OCC 8 is not accepted Page 50 Magellan Health Services Provider Manual 10.0 Appendix A – Plan D.0 Payer Specification To access the Payer Specification document, visit https://mhs.magellanpharmacysolutions.com/pharmacy/common/documents/payer_sheet.pdf. Confidential and Proprietary Page 51 Provider Manual 11.0 Appendix B – Point-of-Sale Reject Codes and Messages The following table lists the rejection codes and explanations, possible B1, B2, B3 fields that may be related to denied payment, and possible solutions for pharmacies experiencing difficulties. All edits may not apply to this program. Pharmacies requiring assistance should call the Magellan Pharmacy Support Center. Refer to Section 1.2 – Contact Information for contact information. 11.1 Version D.0 Reject Codes for Telecommunication Standard All edits may not apply to this program. Table 11.1.1 – Point-of-Sale Reject Codes and Messages Reject Code Explanation ØØ “M/I” Means Missing/Invalid Ø2 M/I Version Number Ø1 Ø3 Ø4 Ø5 Ø6 Ø7 Ø8 Ø9 1C 1E 1Ø 11 12 13 14 15 16 17 19 2C 2E Page 52 Field Number Possibly in Error M/I BIN 1Ø1 M/I Transaction Code 1Ø3 M/I Processor Control Number M/I Pharmacy Number M/I Group Number M/I Cardholder ID Number M/I Person Code M/I Birth Date M/I Smoker/Non-Smoker Code M/I Prescriber Location Code M/I Patient Gender Code M/I Patient Relationship Code M/I Patient Location M/I Other Coverage Code M/I Eligibility Clarification Code M/I Date of Service M/I Prescription/Service Reference Number M/I Fill Number M/I Days Supply M/I Pregnancy Indicator M/I Primary Care Provider ID Qualifier 1Ø2 1Ø4 2Ø1 3Ø1 3Ø2 3Ø3 3Ø4 334 467 3Ø5 3Ø6 3Ø7 3Ø8 3Ø9 4Ø1 4Ø2 4Ø3 4Ø5 335 468 Magellan Health Services Provider Manual Reject Code Explanation Field Number Possibly in Error 2Ø M/I Compound Code 4Ø6 22 M/I Dispense as Written (DAW)/Product Selection Code 4Ø8 21 23 25 26 28 29 3A 3B 3C 3D 3E 3F 3G 3H 3J 3K 3M 3N 3P 3R 3S 3T 3W 3X 3Y 32 33 34 35 38 M/I Product/Service ID M/I Ingredient Cost Submitted M/I Prescriber ID M/I Unit of Measure M/I Date Prescription Written M/I Number Refills Authorized M/I Request Type M/I Request Period Date-Begin M/I Request Period Date-End M/I Basis of Request M/I Authorized Representative First Name M/I Authorized Representative Last Name M/I Authorized Representative Street Address M/I Authorized Representative City Address M/I Authorized Representative State/Province Address M/I Authorized Representative Zip/Postal Zone M/I Prescriber Phone Number M/I Prior Authorized Number Assigned M/I Authorization Number Prior Authorization Not Required M/I Prior Authorization Supporting Documentation Active Prior Authorization Exists Resubmit at Expiration of Prior Authorization Prior Authorization In Process 4Ø7 4Ø9 411 6ØØ 414 415 498-PA 498-PB 498-PC 498-PD 498-PE 498-PF 498-PG 498-PH 498-PJ 498-PK 498-PM 498-PY 5Ø3 4Ø7 498-PP Authorization Number Not Found 5Ø3 M/I Level of Service 418 M/I Submission Clarification Code 42Ø Prior Authorization Denied M/I Prescription Origin Code M/I Primary Care Provider ID M/I Basis of Cost Confidential and Proprietary 419 421 423 Page 53 Provider Manual Reject Code Explanation Field Number Possibly in Error 39 M/I Diagnosis Code 424 4E M/I Primary Care Provider Last Name 57Ø 4C 4Ø 41 5C 5E 5Ø 51 52 53 54 55 56 58 6C 6E 6Ø 61 62 63 64 65 66 67 68 69 7C 7E 7Ø 71 72 73 Page 54 M/I Coordination of Benefits/Other Payments Count Pharmacy Not Contracted With Plan On Date of Service Submit Bill to Other Processor or Primary Payer M/I Other Payer Coverage Type M/I Other Payer Reject Count Non-Matched Pharmacy Number Non-Matched Group ID Non-Matched Cardholder ID Non-Matched Person Code Non-Matched Product/Service ID Number Non-Matched Product Package Size Non-Matched Prescriber ID Non-Matched Primary Prescriber M/I Other Payer ID Qualifier M/I Other Payer Reject Code Product/Service Not Covered for Patient Age Product/Service Not Covered for Patient Gender Patient/Card Holder ID Name Mismatch Institutionalized Patient Product/Service ID Not Covered 337 None None 338 471 2Ø1 3Ø1 3Ø2 3Ø3 4Ø7 4Ø7 411 421 422 472 3Ø2, 3Ø4, 4Ø1, 4Ø7 3Ø2, 3Ø5, 4Ø7 31Ø, 311, 312, 313, 32Ø Claim Submitted Does Not Match Prior Authorization 2Ø1, 4Ø1, 4Ø4, 4Ø7, 416 Patient Age Exceeds Maximum Age 3Ø3, 3Ø4, 3Ø6 Patient Is Not Covered Filled Before Coverage Effective Filled After Coverage Expired Filled After Coverage Terminated M/I Other Payer ID M/I DUR/PPS Code Counter Product/Service Not Covered Prescriber Is Not Covered Primary Prescriber Is Not Covered Refills Are Not Covered 3Ø3, 3Ø6 4Ø1 4Ø1 4Ø1 34Ø 473 4Ø7 411 421 4Ø2, 4Ø3 Magellan Health Services Provider Manual Reject Code Explanation Field Number Possibly in Error 74 Other Carrier Payment Meets or Exceeds Payable 4Ø9, 41Ø, 442 76 Plan Limitations Exceeded 4Ø5, 442 75 77 78 79 8C 8E 8Ø 81 82 83 84 85 86 87 88 89 9Ø Prior Authorization Required Discontinued Product/Service ID Number Cost Exceeds Maximum Refill Too Soon M/I Facility ID M/I DUR/PPS Level Of Effort Drug-Diagnosis Mismatch Claim Too Old Claim Is Post-Dated Duplicate Paid/Captured Claim Claim Has Not Been Paid/Captured Claim Not Processed Submit Manual Reversal Reversal Not Processed DUR Reject Error Rejected Claim Fees Paid Host Hung Up 91 Host Response Error 92 System Unavailable/Host Unavailable 95 Time Out Confidential and Proprietary 462 4Ø7 4Ø7, 4Ø9, 41Ø, 442 4Ø1, 4Ø3, 4Ø5 336 474 4Ø7, 424 4Ø1 4Ø1 2Ø1, 4Ø1, 4Ø2, 4Ø3, 4Ø7 2Ø1, 4Ø1, 4Ø2 None None None Host Disconnected Before Session Completed Response Not In Appropriate Format To Be Displayed Processing Host Did Not Accept Transaction/Did Not Respond Within Time Out Period Refer to (Section 5.2 – Solving Technical Problems for additional information) Page 55 Provider Manual Reject Code Explanation Field Number Possibly in Error 96 Scheduled Downtime Refer to Solving Technical Problems for additional information 97 Payer Unavailable Refer to Solving Technical Problems for additional information 98 Connection to Payer Is Down Refer to Solving Technical Problems for additional information 99 Host Processing Error Do Not Retransmit Claim(s) AB Date Written Is After Date Filled AA AC AD AE AF AG AH AJ AK AM A9 BE B2 CA CB CC CD CE CF CG CH CI Page 56 Patient Spend Down Not Met Product Not Covered Non-Participating Manufacturer Billing Provider Not Eligible To Bill This Claim Type QMB (Qualified Medicare Beneficiary) – Bill Medicare Patient Enrolled Under Managed Care Days’ Supply Limitation for Product/Service Unit Dose Packaging Only Payable for Nursing Home Recipients Generic Drug Required M/I Software Vendor/Certification ID 11Ø M/I Transaction Count 1Ø9 M/I Segment Identification M/I Professional Service Fee Submitted M/I Service Provider ID Qualifier M/I Patient First Name M/I Patient Last Name M/I Cardholder First Name M/I Cardholder Last Name M/I Home Plan M/I Employer Name M/I Employer Street Address M/I Employer City Address M/I Employer State/Province Address 111 477 2Ø2 31Ø 311 312 313 314 315 316 317 318 Magellan Health Services Provider Manual Reject Code Explanation Field Number Possibly in Error CJ M/I Employer Zip Postal Zone 319 CL M/I Employer Contact Name 321 CK CM CN CO CP CQ CR CW CX CY CZ DC DN DQ DR DT DU DV DX DY DZ EA EB EC ED EE EF EG EH EJ EK M/I Employer Phone Number M/I Patient Street Address M/I Patient City Address M/I Patient State/Province Address M/I Patient Zip/Postal Zone M/I Patient Phone Number M/I Carrier ID M/I Alternate ID M/I Patient ID Qualifier M/I Patient ID M/I Employer ID M/I Dispensing Fee Submitted M/I Basis of Cost Determination M/I Usual And Customary Charge M/I Prescriber Last Name M/I Unit Dose Indicator M/I Gross Amount Due M/I Other Payer Amount Paid M/I Patient Paid Amount Submitted M/I Date of Injury M/I Claim/Reference ID M/I Originally Prescribed Product/Service Code M/I Originally Prescribed Quantity M/I Compound Ingredient Component Count M/I Compound Ingredient Quantity M/I Compound Ingredient Drug Cost M/I Compound Dosage Form Description Code M/I Compound Dispensing Unit Form Indicator M/I Compound Route of Administration M/I Originally Prescribed Product/Service ID Qualifier M/I Scheduled Prescription ID Number Confidential and Proprietary 32Ø 322 323 324 325 326 327 33Ø 331 332 333 412 423 426 427 429 43Ø 431 433 434 435 445 446 447 448 449 45Ø 451 452 453 454 Page 57 Provider Manual Reject Code Explanation Field Number Possibly in Error EM M/I Prescription/Service Reference Number Qualifier 445 EP M/I Associated Prescription/Service Date 457 EN ER ET EU EV EW EX EY EZ E1 E3 E4 E5 E6 E7 E8 E9 FO GE HA HB HC HD HE HF HG H1 H2 H3 H4 H5 Page 58 M/I Associated Prescription/Service Reference Number M/I Procedure Modifier Code M/I Quantity Prescribed M/I Prior Authorization Type Code M/I Prior Authorization Number Submitted M/I Intermediary Authorization Type ID M/I Intermediary Authorization ID M/I Provider ID Qualifier M/I Prescriber ID Qualifier M/I Product/Service ID Qualifier M/I Incentive Amount Submitted M/I Reason for Service Code M/I Professional Service Code M/I Result of Service Code M/I Quantity Dispensed M/I Other Payer Date M/I Provider ID M/I Plan ID M/I Percentage Sales Tax Amount Submitted M/I Flat Sales Tax Amount Submitted M/I Other Payer Amount Paid Count M/I Other Payer Amount Paid Qualifier M/I Dispensing Status M/I Percentage Sales Tax Rate Submitted M/I Quantity Intended to Be Dispensed M/I Days Supply Intended to Be Dispensed M/I Measurement Time M/I Measurement Dimension M/I Measurement Unit M/I Measurement Value M/I Primary Care Provider Location Code 456 459 46Ø 461 462 463 464 465 466 436 438 439 44Ø 441 442 443 444 524 482 481 341 342 343 483 344 345 495 496 497 499 469 Magellan Health Services Provider Manual Reject Code Explanation Field Number Possibly in Error H6 M/I DUR Co-Agent ID 476 H8 M/I Other Amount Claimed Submitted Qualifier 479 H7 H9 JE J9 KE M1 M2 M3 M4 M5 M6 M7 M8 ME MZ NE NN PA PB PC PD PE PF PG PH PJ PK PM PN PP PR M/I Other Amount Claimed Submitted Count M/I Other Amount Claimed Submitted M/I Percentage Sales Tax Basis Submitted M/I DUR Co-Agent ID Qualifier M/I Coupon Type Patient Not Covered In This Aid Category 478 48Ø 484 475 485 Recipient Locked In Host PA/MC Error Prescription/Service Reference Number/Time Limit Exceeded Requires Manual Claim Host Eligibility Error Host Drug File Error Host Provider File Error M/I Coupon Number 486 M/I Coupon Value Amount 487 Error Overflow Transaction Rejected at Switch or Intermediary PA Exhausted/Not Renewable Invalid Transaction Count for This Transaction Code 1Ø3, 1Ø9 M/I Clinical Segment 111 M/I Claim Segment M/I COB/Other Payments Segment M/I Compound Segment M/I Coupon Segment M/I DUR/PPS Segment M/I Insurance Segment M/I Patient Segment M/I Pharmacy Provider Segment M/I Prescriber Segment M/I Pricing Segment M/I Prior Authorization Segment Confidential and Proprietary 111 111 111 111 111 111 111 111 111 111 111 Page 59 Provider Manual Reject Code Explanation Field Number Possibly in Error PS M/I Transaction Header Segment 111 PV Non-Matched Associated Prescription/Service Date 457 PT PW PX PY PZ P1 P2 P3 P4 P5 P6 P7 P8 P9 RA RB RC RD RE RF RG RH RJ RK RM RN Page 60 M/I Workers’ Compensation Segment Non-Matched Employer ID Non-Matched Other Payer ID Non-Matched Unit Form/Route of Administration Non-Matched Unit of Measure to Product/Service ID Associated Prescription/Service Reference Number Not Found Clinical Information Counter Out of Sequence 111 333 34Ø 451, 452, 6ØØ 4Ø7, 6ØØ 456 493 Compound Ingredient Component Count Does Not Match Number 447 of Repetitions Coordination of Benefits/Other Payments Count Does Not Match Number of Repetitions 337 Date Of Service Prior to Date of Birth 3Ø4, 4Ø1 Coupon Expired Diagnosis Code Count Does Not Match Number of Repetitions DUR/PPS Code Counter Out of Sequence Field Is Non-Repeatable 486 491 473 PA Reversal Out of Order Multiple Partials Not Allowed Different Drug Entity Between Partial and Completion Mismatched Cardholder/Group ID – Partial To Completion M/I Compound Product ID Qualifier Improper Order of Dispensing Status Code On Partial Fill Transaction M/I Associated Prescription/Service Reference Number On Completion Transaction M/I Associated Prescription/Service Date On Completion Transaction Associated Partial Fill Transaction Not On File Partial Fill Transaction Not Supported Completion Transaction Not Permitted With Same “Date Of Service” As Partial Transaction Plan Limits Exceeded On Intended Partial Fill Values 3Ø1, 3Ø2 488 456 457 4Ø1 344, 345 Magellan Health Services Provider Manual Reject Code Explanation Field Number Possibly in Error RP Out Of Sequence “P” Reversal On Partial Fill Transaction RT M/I Associated Prescription/Service Reference Number On Partial 456 Transaction RS RU R1 R2 R3 R4 R5 R6 R7 R8 R9 SE TE UE VE WE XE ZE M/I Associated Prescription/Service Date On Partial Transaction 457 Mandatory Data Elements Must Occur Before Optional Data Elements In a Segment Other Amount Claimed Submitted Count Does Not Match Number 478, 48Ø Of Repetitions Other Payer Reject Count Does Not Match Number of Repetitions 471, 472 Procedure Modifier Code Invalid for Product/Service ID 4Ø7, 436, 459 Procedure Modifier Code Count Does Not Match Number of Repetitions Product/Service ID Must Be Zero When Product/Service ID Qualifier Equals Ø6 Product/Service Not Appropriate for This Location Repeating Segment Not Allowed in Same Transaction Syntax Error 458, 459 4Ø7, 436 3Ø7, 4Ø7, 436 Value in Gross Amount Due Does Not Follow Pricing Formulae 43Ø M/I Compound Product ID 489 M/I Procedure Modifier Code Count M/I Compound Ingredient Basis of Cost Determination M/I Diagnosis Code Count M/I Diagnosis Code Qualifier M/I Clinical Information Counter M/I Measurement Date Confidential and Proprietary 458 49Ø 491 492 493 494 Page 61 Provider Manual 12.0 Appendix C – State Medicaid Regulatory Requirements This section provides the State Medicaid Regulatory Requirements for which Magellan may represent over time based on the Magellan Health Services Participating Pharmacy Agreement. 12.1 Kentucky Regulatory Addendum This KENTUCKY REGULATORY ADDENDUM (“Addendum”) effective, _______________, 20___ to a Participating Pharmacy Agreement (defined below) is made and entered into between Magellan Health Services, for itself and on behalf of its current and future subsidiaries and Affiliates (“PBM”) and ______________________________________, on behalf of itself and all of its retail pharmacy provider subsidiaries and affiliates (“PHARMACY”). This Addendum shall be automatically effective as of the date of the Addendum, unless Pharmacy provides written objection to PBM prior to the effective date. WHEREAS, PHARMACY is duly licensed by the applicable state licensing board(s) to perform the services contemplated herein; and WHEREAS, PBM has previously entered into a Participating Pharmacy Agreement (“Agreement”) with _____________________ and/or other Payors; WHEREAS, PBM wishes to offer PHARMACY an opportunity to participate in its MCO Program network as a Participating Provider, subject to compliance with applicable Kentucky laws; and WHEREAS, by entering into this Agreement, PHARMACY intends to provide quality health care services to PBM Members (as more fully-defined herein) in the MCO Program. WHEREAS, this Addendum is intended to extend basic principles set forth in the Agreement, in order to comply with the applicable Kentucky legal requirements, including but not limited to the Department for Medicaid Services’ requirements of the Kentucky State Plan for Medical Assistance. WHEREAS, notwithstanding that the Agreement in its present form may already contain many of the applicable regulatory requirements, this Addendum to such Agreement shall supersede and replace any conflicting terms or conditions of the Agreement as of the Effective Date to the extent of such conflict. NOW THEREFORE, in consideration of the premises and the mutual covenants promises made herein, the Parties have agreed and do hereby enter into this Addendum according to the provisions set forth herein with respect to health insurance plans that are regulated by the Commonwealth of Kentucky unless a narrower applicability is indicated by a specific section or provision: The provisions in this Addendum shall be primary and supersede any provision to the contrary which may occur in any other section of this Agreement. Page 62 Magellan Health Services Provider Manual 12.1.1 Article 1 – Kentucky Health Benefit Plan Requirements The following terms and conditions shall supersede and replace anything to the contrary in the Agreement with respect to Pharmacy Services provided in connection with any Kentucky Health Benefit Plan and/or Health Maintenance Organizations. A. Definitions “Health Benefit Plan” means any hospital or medical expense policy or certificate; nonprofit hospital, medical-surgical, and health service corporation contract or certificate; provider sponsored integrated health delivery network; a self-insured plan or a plan provided by a multiple employer welfare arrangement, to the extent permitted by ERISA; health maintenance organization contract; or any health benefit plan that affects the rights of a Kentucky insured and bears a reasonable relation to Kentucky, whether delivered or issued for delivery in Kentucky, and does not include policies covering only accident, credit, dental, disability income, fixed indemnity medical expense reimbursement policy, long-term care, Medicare supplement, specified disease, vision care, coverage issued as a supplement to liability insurance, insurance arising out of a workers' compensation or similar law, automobile medical-payment insurance, insurance under which benefits are payable with or without regard to fault and that is statutorily required to be contained in any liability insurance policy or equivalent self-insurance, short-term coverage, student health insurance offered by a Kentucky-licensed insurer under written contract with a university or college whose students it proposes to insure, medical expense reimbursement policies specifically designed to fill gaps in primary coverage, coinsurance, or deductibles and provided under a separate policy, certificate, or contract, or coverage supplemental to the coverage provided under Chapter 55 of Title 10, United States Code, or limited health service benefit plans (as such definition may be amended from time to time under KRS 304.17A-005(22)). B. Participation in Other Benefit Plans PBM shall not require PHARMACY, as a condition of participation under the Agreement, to participate in any of PBM’s other Health Benefit Plans. (KRS §304.17A-150) C. Any Willing Provider PBM shall not discriminate against any provider who is located within the geographic coverage area of the PBM and is willing to meet the terms and conditions for participation established by the PBM, including the Kentucky state Medicaid program and Medicaid partnerships, or relevant benefit plan. (KRS §304.17A-270) D. Claims Payment PBM will comply with the Prompt-Pay statute, codified within KRS 304.17A-700-730, as may be amended, and KRS 205.593, and KRS 304.14-135 and 99-123, as may be amended (KRS §304.17A700 et al.). Confidential and Proprietary Page 63 Provider Manual The PBM shall notify PHARMACY of any decision to deny a claim, or to authorize a service in an amount, duration, or scope that is less than requested. E. Discounted Fee Reimbursement PBM shall not reimburse PHARMACY on a discounted fee basis other than the discounts disclosed in this Agreement (KRS §304.17A-728). F. Audits of Pharmacy Records Pharmacy shall allow PBM access to its records and to conduct audits in compliance with KRS §304.17A-740 through KRS §304.17A-743, inclusive (KRS §304.17A-740 through KRS §304.17A740 et al.). 12.1.2 Article II – Kentucky Managed Care Plan Requirements The following terms and conditions shall supersede and replace anything to the contrary in the Agreement with respect to Pharmacy Services provided in connection with any Managed Care Plan. A. Definitions “Managed Care Plan” means a health insurance policy that integrates the financing and delivery of appropriate health care services to enrollees by arrangements with participating providers who are selected to participate on the basis of explicit standards to furnish a comprehensive set of health care services and financial incentives for enrollees to use the participating providers and procedures provided for in the plan (as such definition may be amended from time to time under KRS 304.17A-500(9)). “Material Change” means a change to a contract, the occurrence and timing of which is not otherwise clearly identified in the contract, that decreases the health care provider's payment or compensation or changes the administrative procedures in a way that may reasonably be expected to significantly increase the provider's administrative expense (as such definition may be amended from time to time under KRS 304.17A-578). Page 64 Magellan Health Services Provider Manual B. Hold Harmless PHARMACY shall not, under any circumstance, including (1) nonpayment of moneys due the PHARMACY by the PBM or MCO, (2) insolvency of the PBM or MCO, or (3) breach of this Agreement, bill, charge, collect a deposit, seek compensation, remuneration or reimbursement from, or have any recourse against the subscriber, dependent of subscriber, enrollee, or any persons acting on their behalf, for services provided in accordance with this Agreement other than the collection of deductible amounts, copayment amounts, coinsurance amounts, and amounts for noncovered services (KRS §304.17A-527). C. Continuation of Care Provider shall, upon termination of the Agreement for reasons other than a quality of care issue or fraud, continue to provide and be compensated for PHARMACY’s services to Covered Persons under the terms and conditions of the Agreement until the earlier of such time that such Covered Person has completed his/her course of treatment; or reasonable and medically appropriate arrangements have been made for a participating provider to render health care services to the Covered Person. In the case of a pregnant woman, PHARMACY shall continue to provide services through the end of the post-partum period if the pregnant woman is in her fourth or later month of pregnancy (KRS §304.17A-527). D. Survivorship Section II(B) (Hold Harmless) and Section II(C) (Continuation of Care) of this Addendum shall survive the termination of this Agreement (KRS §304.17A-527). E. Fee Schedules Upon PHARMACY request, PBM shall provide or make available to PHARMACY, when contracting or renewing an existing contract with PHARMACY, the payment or fee schedules or other information sufficient to enable the PHARMACY to determine the manner and amount of payments under this Agreement for PHARMACY’s services prior to the final execution or renewal. If PBM decides to make any changes to the fee schedule or payment for PHARMACY’s services, PBM shall provide PHARMACY at least 90 days notice prior to the effective date of the change (KRS §304.17A-527). F. Provider Subcontracts In the event PHARMACY enters into any subcontract agreement with another provider to provide their licensed health care services to a Covered Person, the subcontract agreement must meet all applicable requirements of this Addendum and all such subcontract agreements shall be filed with the Kentucky Commissioner of Insurance (KRS §304.17A-527). Confidential and Proprietary Page 65 Provider Manual G. Provider’s Disclosure to Covered Persons PBM shall not limit PHARMACY’s disclosure to a Covered Person, or to another person on behalf of the Covered Person, of any information relating the Covered Person’s medical condition or treatment options. PBM shall not limit, penalize or terminate the Agreement due to PHARMACY’s disclosure to a Covered Person who is PHARMACY’s patient for discussing (i) all treatment options with the Covered Person; (ii) any information that the PHARMACY determines to be in the best interest of the Covered Person; and (iii) financial incentives and financial arrangements between the Provider and PBM. Upon request, PBM shall inform its Covered Persons in writing of the type of financial arrangements between the plan and participating providers if those arrangements include an incentive or bonus (KRS §304.17A-530). H. Most Favored Nation Nothing in the Agreement shall be interpreted as a “most favored nation” provision (KRS 304.17A560). I. Material Changes If PBM makes any Material Changes to the Agreement or any attachments, addenda and exhibits thereto, PBM will provide written notice to PHARMACY within 90 days of the material change. The notice shall include a description of the Material Change and a statement that PHARMACY has the option to withdraw from the agreement prior to the Material Change becoming effective. In the event PHARMACY wishes to opt out of any Material Change to the Agreement, PHARMACY shall send a written notice of withdrawal to the PBM no later than 45 days prior to the effective date of the Material Change. If PBM makes changes to prior authorization, precertification, notification, or referral programs, PBM shall provide PHARMACY 15 days prior notice to such change (KRS §304.17A-578). 12.1.3 Article III – Kentucky Health Maintenance Organization and Limited Health Service Benefit Plan Requirements The following terms and conditions shall supersede and replace anything to the contrary in the Agreement with respect to Pharmacy Services provided in connection with any Kentucky Health Maintenance Organization or Limited Health Service Benefit Plan. A. Definitions “Health Maintenance Organization” (or “HMO”) means any person who undertakes to provide, directly or through arrangements with others, health care services to individuals enrolled with such an organization on a per capita or a predetermined, fixed prepayment basis. A health Page 66 Magellan Health Services Provider Manual maintenance organization is authorized to provide all health care services (as such definition may be amended from time to time unde KRS 304.38-30(5)). “Limited Health Service Benefit Plan” (or “LHSBP”) means any policy or certificate that provides services for dental, vision, mental health, substance abuse, chiropractic, pharmaceutical, podiatric, or other such services as may be determined by the commissioner to be offered under a limited health service benefit plan. A limited health service benefit plan shall not include hospital, medical, surgical, or emergency services except as these services are provided incidental to the plan (as such definition may be amended from time to time under KRS §304.17C-010). (Per KRS § 304.38200, Health Maintenance Organizations are subject to the requirements applicable to Limited Health Service Benefit Plans.) B. Hold Harmless PHARMACY shall not, under any circumstance, including (1) nonpayment of moneys due the PHARMACY by the PBM, HMO, or LHSBP, (2) insolvency of the PBM, HMO, or LHSBP, or (3) breach of this Agreement, bill, charge, collect a deposit, seek compensation, remuneration or reimbursement from, or have any recourse against the subscriber, dependent of subscriber, enrollee, or any persons acting on their behalf, for services provided in accordance with this Agreement other than the collection of deductible amounts, copayment amounts, coinsurance amounts, and amounts for noncovered services. (KRS §304.17C-060) C. Continuation of Care Provider shall, upon termination of the Agreement for reasons other than a quality of care issue or fraud, continue to provide and be compensated for PHARMACY’s services to Covered Persons under the terms and conditions of the Agreement until the earlier of such time that such Covered Person has completed his or her course of treatment; or reasonable and medically appropriate arrangements have been made for a participating provider to render health care services to the Covered Person. D. Survivorship Section III (B) (Hold Harmless) and Section III (C) (Continuation of Care) of this Addendum shall survive the termination of this Agreement (KRS §304.17C-060). E. Provider Subcontracts In the event PHARMACY enters into any subcontract agreement with another provider to provide their licensed health care services to a Covered Person, the subcontract agreement must meet all requirements of this Addendum and that all such subcontract agreements shall be filed with the Commissioner of Insurance (KRS §304.17C-060). Confidential and Proprietary Page 67 Provider Manual F. Provider’s Disclosure to Covered Persons PBM shall not limit PHARMACY’s disclosure to a Covered Person, or to another person on behalf of the Covered Person, of any information relating the Covered Person’s medical condition or treatment options. PBM shall not limit, penalize or terminate the Agreement due to PHARMACY’s disclosure to a Covered Person who is PHARMACY’s patient for discussing (i) all treatment options with the Covered Person; (ii) any information that the PHARMACY determines to be in the best interest of the Covered Person; and (iii) financial incentives and financial arrangements between the Provider and PBM. Upon request, PBM shall inform Covered Persons in writing of the type of financial arrangements between the plan and participating providers if those arrangements include an incentive or bonus (KRS §304.17C-070). 12.1.4 Article IV – Kentucky Managed Medicaid Requirements The following terms and conditions shall supersede and replace anything to the contrary in the Agreement with respect to PHARMACY Services provided in connection with any provider partnership, health maintenance organization, or other managed care organization under contract with the Kentucky Cabinet for Health and Family Services Department for Medicaid Services (the “Department for Medicaid Services”) to manage care and process health care claims for services delivered to Medicaid recipients covered under Medicaid managed care (a “Managed Medicaid Plan”). A. Incorporation of Other Provisions Sections I.C (Claims Payment), I.E. (Audit), and I(F) (Any Willing Pharmacy) of this Addendum shall also apply with respect to a Managed Medicaid Plan as if such plan were a “Health Benefit Plan”). B. Indemnification PHARMACY shall indemnify, defend and hold harmless the Commonwealth of Kentucky, its officers, agents, and employees, and each and every Covered person from any liability whatsoever arising in connection with this Agreement for the payment of any debt or the fulfillment of any obligation of PHARMACY. Page 68 Magellan Health Services Provider Manual 12.2 South Carolina Regulatory Addendum This SOUTH CAROLINA REGULATORY ADDENDUM (“Addendum”) effective, _______________, 20___ to a Participating Pharmacy Agreement (defined below) is made and entered into between Magellan Health Services, for itself and on behalf of its current and future subsidiaries and Affiliates (“PBM”) and ______________________________________, on behalf of itself and all of its retail pharmacy provider subsidiaries and affiliates (“PHARMACY”). This Addendum shall be automatically effective as of the date of the Addendum, unless Pharmacy provides written objection to PBM prior to the effective date. WHEREAS, PHARMACY is duly licensed by the applicable state licensing board(s) to perform the services contemplated herein; and WHEREAS, PBM has previously entered into a Participating Pharmacy Agreement (“Agreement”) with Community Health Solutions and/or other Payors, which hold a Managed Care Organization Contract (“MCO Contract”) with the South Carolina Department of Health and Human Services (“SC DHHS”) pursuant to which it provides health care services as a Medicaid MCO; and WHEREAS, PBM wishes to offer PHARMACY an opportunity to participate in its Medicaid MCO Program network as a Participating Provider, subject to SC DHHS’s credentialing requirements; and WHEREAS, by entering into this Agreement, PHARMACY intends to provide quality health care services to PBM Members (as more fully-defined herein) in the Medicaid MCO Program. WHEREAS, this Addendum is intended to extend basic principles set forth in the Agreement, in order to comply with the applicable South Carolina legal requirements, including South Carolina Department of Health and Human Service’s (SC DHHS) requirements of the South Carolina State Plan for Medical Assistance. WHEREAS, notwithstanding that the Agreement in its present form may already contain many of the applicable regulatory requirements, this Addendum to such Agreement shall supersede and replace any conflicting terms or conditions of the Agreement as of the Effective Date to the extent of such conflict. NOW THEREFORE, in consideration of the premises and the mutual covenants promises made herein, the Parties have agreed and do hereby enter into this Addendum according to the provisions set forth herein with respect to any Benefit Plans that are regulated by the State of South Carolina unless a narrower applicability is indicated by a specific section or provision. Confidential and Proprietary Page 69 Provider Manual 12.2.1 A. Article I – In General In General: The provisions in this Addendum shall be primary and supersede any provision to the contrary which may occur in any other section of this Agreement. B. Legal Consequences: Each of the Parties is responsible for the legal consequences and costs of their own acts or omissions, or both, and is not responsible for the acts or omissions, or both, of the other party. Nothing in the Agreement shall be interpreted to convey a contrary legal responsibility (S.C. Code Ann. §1740(A)(1)). C. Prohibited Limitations: PBM shall not limit PHARMACY’s: 1. Ability to discuss with a Covered Person the treatment options available to the covered Person, risks associated with treatments, utilization management decisions, and recommended course of treatment (S.C. Code Ann. §1740(A)(2)(a)); or 12.2.2 2. Legal obligations to Covered Persons as specified under PHARMACY’s professional license (S.C. Code Ann. §1740(A)(2)(a)). Article II – SC DHHS Medicaid Requirements The following terms and conditions shall supersede and replace anything to the contrary in the Agreement with respect to PHARMACY Services provided in connection with any Benefit Plan that is a managed Medicaid Plan offered under contract with South Carolina Department of Health & Human Services (“SC DHHS”). In addition, PHARMACY agrees to include the following provisions in materially similar form, in any subcontract for the provision of services hereunder. A. Definitions 1. Action – As related to Grievance, either (1) the denial or limited authorization of a requested service, including the type or level of service; (2) the reduction, suspension, or termination of a previously authorized service; (3) the denial, in whole or in part, of payment for a service; (4) the failure to provide services in a timely manner, as defined by SC DHHS; (5) the failure of the MCO to act within the timeframes provided in §9.7.1 of the MCO Contract with the SC DHHS; or (6) for a resident of a rural area with only one MCO, the denial of a Medicaid MCO Member's request to exercise his or her right, under 42 CFR §438.52(b)(2)(ii), to obtain services outside the MCO’s network. 2. Additional Service(s) – A service(s) provided by the MCO which is a non-covered service(s) by the South Carolina State Plan for Medical Assistance and is offered to Medicaid MCO Members in accordance with the standards and other requirements set forth in the MCO Contract with the SC DHHS which may be outlined in another section of this Agreement. 3. Clean Claim – A claim that can be processed without obtaining additional information from the PHARMACY of the service or from a third party. Page 70 Magellan Health Services Provider Manual 4. Continuity of Care – The continuous treatment for a condition (such as pregnancy) or duration of illness from the time of first contact with a healthcare provider through the point of release or long-term maintenance. 5. Emergency Medical Condition – A medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in: placing the health of the individual (or, with respect to a pregnant woman, the health of the woman and/or her unborn child) in serious jeopardy; serious impairment to bodily functions, or serious dysfunction of any bodily organ or part. 6. Emergency Services – Covered inpatient and outpatient services that are as follows: (1) furnished by a provider that is qualified to furnish these services under this title; and (2) needed to evaluate or stabilize an Emergency Medical Condition. 7. Federal Qualified Health Center (FQHC) – A South Carolina licensed health center certified by the Centers for Medicare and Medicaid Services that receives Public Health Services grants. An FQHC provides a wide range of primary care and enhanced services in a medically under-served area. 8. Grievance – An expression of dissatisfaction about any matter other than an Action. The term is also used to refer to the overall system that includes grievances and appeals handled at the MCO level. (Possible subjects for Grievances include, but are not limited to, the quality of care or services provided, and aspects of interpersonal relationships such as rudeness of a provider or employee, or failure to respect the Medicaid MCO Member’s rights.) 9. Healthcare Medicaid Provider – A provider of healthcare services or products which includes but is not limited to an institution, facility, agency, person, corporation, partnership, practitioner, specialty physician, group or association approved by SC DHHS, licensed and/or credentialed which accepts as payment in full for providing benefits to Medicaid MCO Members amounts pursuant to the MCO reimbursement provisions, business requirements and schedules. 10. Managed Care Organization – An entity that has, or is seeking to qualify for, a comprehensive risk contract that is (1) a Federally qualified HMO that meets the advance directive requirements of subpart I of 42 CFR Part 489; or (2) any public or private entity that meets the advance directives requirements and is determined to also meet the following conditions: (a) makes the services it provides to its Medicaid MCO Members as accessible (in terms of timeliness, amount, duration, and scope) as those services are to other Medicaid recipients within the area serviced by the entity; and (b) meets the solvency standards of 42 CFR §438.116. This includes any of the entity’s employees, affiliated providers, agents, or contractors. 11. Medically Necessary Service – Those medical services which: (a) are essential to prevent, diagnose, prevent the worsening of, alleviate, correct or cure medical conditions that Confidential and Proprietary Page 71 Provider Manual endanger life, cause suffering or pain, cause physical deformity or malfunction, threaten to cause or aggravate a handicap, or result in illness or infirmity of a Medicaid MCO Member; (b) are provided at an appropriate facility and at the appropriate level of care for the treatment of the Medicaid MCO Member's medical condition; and, (c) are provided in accordance with generally accepted standards of medical practice. 12. Medicaid MCO Member – An eligible person(s) who is enrolled with a SC DHHS approved Medicaid Managed Care Organization. For purpose of this subcontract, Medicaid MCO Member shall include the patient, parent(s), guardian, spouse or any other person legally responsible for the Medicaid MCO Member being served. 13. MCO – The Managed Care Organization who is requesting services under this Agreement (through the PBM). 14. Primary Care Provider (PCP) – The provider who serves as the entry point into the health care system for the Medicaid MCO Member. The PCP is responsible for providing primary care, coordinating and monitoring referrals to specialist care, authorizing hospital services, and maintaining Continuity of Care. B. 15. Rural Health Clinic (RHC) – A South Carolina licensed rural health clinic is certified by the Centers for Medicare and Medicaid Services and receiving Public Health Services grants. An RHC is eligible for state defined cost-based reimbursement from the Medicaid fee-forservice program. An RHC provides a wide range of primary care and enhanced services in a medically underserved area. Administration 1. SC DHHS retains the right to review any and all subcontracts entered into for the provision of any services under this Agreement. 2. SC DHHS does not require PHARMACY to participate in any other line of business (i.e., Medicare Advantage or commercial) offered by the MCO in order to participate in the MCO’s Medicaid network. 3. SC DHHS does not require PHARMACY to participate in the network of any other Managed Care Organization as a condition of participation in MCO’s network. 4. MCO and PHARMACY shall be responsible for resolving any disputes that may arise between the two parties, and no dispute shall disrupt or interfere with the Continuity of Care of a Medicaid MCO Member. 5. PHARMACY represents and covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of its services hereunder. PHARMACY further covenants that, in the performance of this Agreement, no person having any such known interests shall be employed. Page 72 Magellan Health Services Provider Manual 6. PHARMACY recognizes that in the event of termination of the MCO Contract between MCO and SC DHHS, the MCO is required to make available to SC DHHS or its designated representative, in a usable form, any and all records, whether medical or financial, related to the MCO's and PHARMACY’s activities undertaken pursuant to this Agreement. The PHARMACY agrees to furnish any records to the MCO which the MCO would need in order to comply with this provision. The provision of such records shall be at no expense to SC DHHS. 7. In the event of termination of this Agreement, SC DHHS will be notified of the intent to terminate this Agreement 120 calendar days prior to the effective date of termination. The date of termination will be at midnight on the last day of the month of termination. C. 8. If the termination of this Agreement is as a result of a condition or situation which would have an adverse impact on the health and safety of Medicaid MCO Members, the termination shall be effective immediately and SC DHHS will be immediately notified of the termination and provided any information requested by SC DHHS. Hold Harmless 1. At all times during the term of this Agreement, PHARMACY shall, except as otherwise prohibited or limited by law, indemnify and hold SC DHHS harmless from all claims, losses, or suits relating to activities undertaken pursuant to this Agreement. 2. If PHARMACY is not a political subdivision of the State of South Carolina, an affiliate organization, or otherwise prohibited or limited by law, PHARMACY shall indemnify, defend, protect, and hold harmless SC DHHS and any of its officers, agents, and employees from: a. Any claims for damages or losses arising from services rendered by any subcontractor, person, or firm performing or supplying services, materials, or supplies for the PHARMACY in connection with the performance of this Agreement; b. Any claims for damages or losses to any person or firm injured or damaged by erroneous or negligent acts, including disregard of state or federal Medicaid regulations or legal statutes, by PHARMACY, its agents, officers, employees, or subcontractors in the performance of this Agreement; c. Any claims for damages or losses resulting to any person or firm injured or damaged by PHARMACY, its agents, officers, employees, or subcontractors by the publication, translation, reproduction, delivery, performance, use, or disposition of any data processed under this Agreement in a manner not authorized by the Agreement or by federal or state regulations or statutes; d. Any failure of the PHARMACY, its agents, officers, employees, or subcontractors to observe the federal or state laws, including, but not limited to, labor laws and minimum wage laws; Confidential and Proprietary Page 73 Provider Manual e. Any claims for damages, losses, or costs associated with legal expenses, including, but not limited to, those incurred by or on behalf of SC DHHS in connection with the defense of claims for such injuries, losses, claims, or damages specified above; f. Any injuries, deaths, losses, damages, claims, suits, liabilities, judgments, costs and expenses which may in any manner accrue against SC DHHS or their agents, officers or employees, through the intentional conduct, negligence or omission of the PHARMACY, its agents, officers, employees or subcontractors. 3. As required by the South Carolina Attorney General, in circumstances where the PHARMACY is a political subdivision of the State of South Carolina, or an affiliate organization, except as otherwise prohibited by law, neither PHARMACY nor SC DHHS shall be liable for any claims, demands, expenses, liabilities and losses (including reasonable attorney's fees) which may arise out of any acts or failures to act by the other party, its employees or agents, in connection with the performance of services pursuant to this Agreement. 4. In accordance with the requirements of S.C. Code Ann. § 38-33-130(b) (Supp. 2001, as amended), and as a condition of participation as a Healthcare Medicaid Provider, PHARMACY hereby agrees not to bill, charge, collect a deposit from, seek compensation, remuneration or reimbursement from, or have recourse against, Medicaid MCO Members, or persons acting on their behalf, for health care services which are rendered to such Medicaid MCO Members by the PHARMACY, and which are covered benefits under the Medicaid MCO Member’s evidence of coverage. This provision applies to all covered health care services furnished to the Medicaid MCO Member for which SC DHHS does not pay the MCO or the MCO does not pay the PHARMACY. PHARMACY agrees that this provision is applicable in all circumstances including, but not limited to, non-payment by MCO and insolvency of MCO. PHARMACY further agrees that this provision shall be construed to be for the benefit of Medicaid MCO Members and that this provision supersedes any oral or written contrary agreement now existing or hereafter entered into between PHARMACY and such Medicaid MCO Members. D. 5. It is expressly agreed that PBM, the MCO, PHARMACY and agents, officers, and employees of the PBM, MCO or PHARMACY in the performance of this Agreement shall act in an independent capacity and not as officers and employees of SC DHHS or the State of South Carolina. It is further expressly agreed that this Agreement shall not be construed as a partnership or joint venture between the PBM, MCO or PHARMACY and SC DHHS and the State of South Carolina. Health Care Services 1. PHARMACY shall ensure adequate access to the services provided under this Agreement in accordance with the prevailing medical community standards. Page 74 Magellan Health Services Provider Manual 2. The services covered by this Agreement must be in accordance with the South Carolina State Plan for Medical Assistance under Title XIX of the Social Security Act, and PHARMACY shall provide these services to Medicaid MCO Members through the last day that this Agreement is in effect. All final Medicaid benefit determinations are within the sole and exclusive authority of SC DHHS or its designee. 3. PHARMACY may not refuse to provide Medically Necessary Services or covered preventive services to Medicaid MCO Members for non-medical reasons. 4. PHARMACY shall render Emergency Services without the requirement of prior authorization of any kind. 5. The PHARMACY shall not be prohibited or otherwise restricted from advising a Medicaid MCO Member about the health status of the Medicaid MCO Member or medical care or treatment for the Medicaid MCO Member’s condition or disease, regardless of whether benefits for such care or treatment are provided under the MCO Contract with SC DHHS, if PHARMACY is acting within the lawful scope of practice. 6. PHARMACY must take adequate steps to ensure that Medicaid MCO Members with limited English skills receive, free of charge, the language assistance necessary to afford them meaningful and equal access to the benefits and services provided under this Agreement in accordance with Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et. seq.) (2001, as amended) and its implementing regulation at 45 C.F.R. Part 80 (2001, as amended). 7. PHARMACY shall provide effective Continuity of Care activities, if applicable, that seek to ensure that the appropriate personnel, including the Primary Care Provider (PCP), are kept informed of the Medicaid MCO Member’s treatment needs, changes, progress or problems 8. PHARMACY must adhere to the Quality Assessment Performance Improvement and Utilization Management (UM) requirements as outlined by SC DHHS and/or its designee. 9. PHARMACY shall have an appointment system for Medically Necessary Services that is in accordance with prevailing medical community standards. 10. PHARMACY shall not use discriminatory practices with regard to Medicaid MCO Members such as separate waiting rooms, separate appointment days, or preference to private pay patients. 11. PHARMACY must identify Medicaid MCO Members in a manner that will not result in discrimination against the Medicaid MCO Member in order to provide or coordinate the provision of all core benefits and/or Additional Services and out of plan services. 12. PHARMACY agrees that no person, on the grounds of handicap, age, race, color, religion, sex, or national origin, shall be excluded from participation in, or be denied benefits of the MCO’s program or be otherwise subjected to discrimination in the performance of this Agreement or in the employment practices of PHARMACY. PHARMACY shall upon request show proof of such non-discrimination, and shall post in conspicuous places, available to all employees and applicants, notices of non-discrimination. Confidential and Proprietary Page 75 Provider Manual 13. If the PHARMACY performs laboratory services, the PHARMACY must meet all applicable state and federal requirements related thereto. 14. If PHARMACY is a hospital, PHARMACY shall notify the MCO and SC DHHS of the births when the mother is a Medicaid MCO Member. PHARMACY shall also complete SC DHHS Request for Medicaid ID Number (Form 1716 ME), including indicating whether the mother is a Medicaid MCO Member, and submit the form to the local/state SC DHHS office. 15. If PHARMACY is an FQHC/RHC, PHARMACY shall adhere to federal requirements for reimbursement for FQHC/RHC services. This Agreement shall specify the agreed upon payment from the MCO to the FQHC/RHC. Any bonus or incentive arrangements made to the FQHCs/RHCs associated with Medicaid MCO Members must also be specified and included this Agreement. E. 16. PHARMACY shall submit all reports and clinical information required by the MCO, including Early Periodic Screening, Diagnosis, and Treatment (if applicable). Laws 1. PHARMACY shall recognize and abide by all state and federal laws, regulations and SC DHHS guidelines applicable to the provision of services under the Medicaid MCO Program. PHARMACY must comply with all applicable statutory and regulatory requirements of the Medicaid program and be eligible to participate in the Medicaid program. 2. This Agreement shall be subject to and hereby incorporates by reference all applicable federal and state laws, regulations, policies, and revisions of such laws or regulations shall automatically be incorporated into the Agreement as they become effective. 3. PHARMACY represents and warrants that it has not been excluded from participation in the Medicare and/or Medicaid program pursuant to §§ 1128 (42 U.S.C. 1320a-7) (2001, as amended) or 1156 (42 U.S.C. 1320c5) (2001, as amended) of the Social Security Act or is not otherwise barred from participation in the Medicaid and/or Medicare program. 4. PHARMACY also represents and warrants that it has not been debarred, suspended or otherwise excluded from participating in procurement activities under the Federal Acquisition Regulation or from non-procurement activities under regulations issued under Executive Orders. 5. PHARMACY shall not have a Medicaid contract with SC DHHS that was terminated, suspended, denied, or not renewed as a result of any action of Center for Medicare and Medicaid Services (CMS), United States Department of Health and Human Services (HHS), or the Medicaid Fraud Unit of the Office of the South Carolina Attorney General. PHARMACYs that have been sanctioned by any state or federal controlling agency for Medicaid and/or Medicare fraud and abuse and are currently under suspension shall not be allowed to participate in the Medicaid MCO Program. In the event PHARMACY is suspended, sanctioned or otherwise excluded during the term of this Agreement, PHARMACY shall immediately notify MCO and PBM in writing. Page 76 Magellan Health Services Provider Manual 6. PHARMACY ensures that it does not employ individuals who are debarred, suspended, or otherwise excluded from participating in federal procurement activities and/or have an employment, consulting, or other contract with debarred individuals for the provision of items and services that are significant to the MCO’s contractual obligation. 7. PHARMACY shall check the Excluded Parties List Service administered by the General Services Administration, when it hires any employee or contracts with any subcontractor, to ensure that it does not employ individuals or use subcontractors who are debarred, suspended, or otherwise excluded from participating in federal procurement activities and/or have an employment, consulting, or other contract with debarred individuals for the provision of items and services that are significant to PHARMACY's contractual obligation. PHARMACY shall also report to the MCO any employees or subcontractors that have been debarred, suspended, and/or excluded from participation in Medicaid, Medicare, or any other federal program. 8. In accordance with 42 CFR §455.104 (2010, as amended), the PHARMACY agrees to provide full and complete ownership and disclosure information with the execution of this Agreement and to report any ownership changes within 35 calendar days to PBM and MCO. PHARMACY must download the appropriate form from the MCO website or request a printed copy be sent. Failure by the PHARMACY to disclose this information may result in termination of this Agreement. F. 9. It is mutually understood and agreed this Section of the Addendum shall be governed by the laws and regulations of the State of South Carolina both as to interpretation and performance by PHARMACY. Any action at law, suit in equity, or judicial proceeding for the enforcement of this Section of the Addendum or any provision thereof shall be instituted only in the courts of the State of South Carolina. Specific provisions related to dispute resolution between the MCO and PHARMACY related to the other sections of this Addendum and/or the Agreement are provided in those other sections. Billing a Medicaid MCO Member 1. PHARMACY may only bill a Medicaid MCO Member under the following conditions: a. When PHARMACY renders services that are non-covered services and are not Additional Services, as long as the PHARMACY: (A) provides to the Medicaid MCO Member a written statement of the services prior to rendering said services, which must include: (i) the cost of each service(s); and (ii) an acknowledgement of Medicaid MCO Member’s payment responsibility, and (B) obtains Medicaid MCO Member’s signature on the statement. 2. When the service provided has a co-payment, as allowed by the MCO, PHARMACY may charge the Medicaid MCO Member only the amount of the allowed co-payment, which cannot exceed the co-payment amount allowed by SC DHHS. Confidential and Proprietary Page 77 Provider Manual G. Audit, Records, and Oversight 1. PHARMACY shall maintain an adequate record system for recording services, service providers, charges, dates and all other commonly accepted information elements for services rendered to Medicaid MCO Members pursuant to this Agreement (including, but not limited to, such records as are necessary for the evaluation of the quality, appropriateness, and timeliness of services performed). Medicaid MCO Members and their representatives shall be given access to and can request copies of the Medicaid MCO Members’ medical records, to the extent and in the manner provided by S.C. Code Ann. §44115-10 et. seq., (Supp. 2000, as amended). 2. SC DHHS, HHS, CMS, the OIG, the State Comptroller, the State Auditor's Office, and the South Carolina Attorney General's Office shall have the right to evaluate, through audit, inspection, or other means, whether announced or unannounced, any records pertinent to this Agreement, including those pertaining to quality, appropriateness and timeliness of services and the timeliness and accuracy of encounter data and PHARMACY claims submitted to the MCO. The PHARMACY shall cooperate with these evaluations and inspections. PHARMACY will make office work space available for any of the above-mentioned entities or their designees when the entities are inspecting or reviewing any records related to the provision of services under this Agreement. 3. Whether announced or unannounced, PHARMACY shall participate and cooperate in any internal and external quality assessment review, utilization management, and Grievance procedures established by SC DHHS or its designee. 4. PHARMACY shall comply with any plan of correction initiated by the MCO and/or required by SC DHHS. 5. All records originated or prepared in connection with the PHARMACY's performance of its obligations under this Agreement, including, but not limited to, working papers related to the preparation of fiscal reports, medical records, progress notes, charges, journals, ledgers, and electronic media, will be retained and safeguarded by the PHARMACY in accordance with the terms and conditions of this Agreement. The PHARMACY agrees to retain all financial and programmatic records, supporting documents, statistical records and other records of Medicaid MCO Members relating to the delivery of care or service under this Agreement, and as further required by SC DHHS, for a period of five years from the expiration date of the Agreement, including any Agreement extension(s). If any litigation, claim, or other actions involving the records have been initiated prior to the expiration of the five-year period, the records shall be retained until completion of the action and resolution of all issues which arise from it or until the end of the five-year period, whichever is later. If PHARMACY stores records on microfilm or microfiche, PHARMACY must produce, at its expense, legible hard copy records upon the request of state or federal authorities, within 15 calendar days of the request. 6. SC DHHS and/or any designee will also have the right to: Page 78 Magellan Health Services Provider Manual a. Inspect and evaluate the qualifications and certification or licensure of PHARMACY; b. Evaluate, through inspection of PHARMACY’s facilities or otherwise, the appropriateness and adequacy of equipment and facilities for the provision of quality health care to Medicaid MCO Members; c. Audit and inspect any of PHARMACY’s records that pertain to health care or other services performed under this Agreement, determine amounts payable under this Agreement; d. Audit and verify the sources of encounter data and any other information furnished by PHARMACY or MCO in response to reporting requirements of this Agreement or the MCO Contract with SC DHHS, including data and information furnished by subcontractors. 7. PHARMACY shall release medical records of Medicaid MCO Members, as may be authorized by the Medicaid MCO Member or as may be directed by authorized personnel of SC DHHS, appropriate agencies of the State of South Carolina, or the United States Government. Release of medical records shall be consistent with the provisions of confidentiality as expressed in this Agreement. H. 8. PHARMACY shall maintain up-to-date medical records at the site where medical services are provided for each Medicaid MCO Member for whom services are provided under this Agreement. Each Medicaid MCO Member's record must be legible and maintained in detail consistent with good medical and professional practice which permits effective internal and external quality review and/or medical audit and facilitates an adequate system of followup treatment. SC DHHS representatives or designees shall have immediate and complete access to all records pertaining to the health care services provided to the Medicaid MCO Member. Safeguarding Information 1. PHARMACY shall safeguard information about Medicaid MCO Members according to applicable state and federal laws and regulations. 2. PHARMACY shall assure that all material and information, in particular information relating to Medicaid MCO Members, which is provided to or obtained by or through the PHARMACY’s performance under this Agreement, whether verbal, written, electronic file, or otherwise, shall be protected as confidential information to the extent confidential treatment is protected under state and federal laws. PHARMACY shall not use any information so obtained in any manner except as necessary for the proper discharge of its obligations and securement of its rights under this Agreement. 3. All information as to personal facts and circumstances concerning Medicaid MCO Members obtained by the PHARMACY shall be treated as privileged communications, shall be held confidential, and shall not be divulged to third parties without the written consent of SC Confidential and Proprietary Page 79 Provider Manual DHHS or the Medicaid MCO Member, provided that nothing stated herein shall prohibit the disclosure of information in summary, statistical, or other form which does not identify particular individuals. 4. The use or disclosure of information concerning Medicaid MCO Members shall be limited to purposes directly connected with the administration of this Agreement. I. 5. All records originated or prepared in connection with PHARMACY's performance of its obligations under this Agreement, including but not limited to, working papers related to the preparation of fiscal reports, medical records, progress notes, charges, journals, ledgers, and electronic media, will be retained and safeguarded by the PHARMACY and its subcontractors in accordance with the terms and conditions of this Agreement. Payment Timeframes 1. The PBM shall pay 90 percent of all Clean Claims from practitioners, either in individual or group practice or who practice in shared health facilities, within 30 days of the date of receipt. The MCO shall pay 99 percent of all Clean Claims from practitioners, either in individual or group practice or who practice in shared health facilities, within 90 days of the date of receipt. The date of receipt is the date the MCO receives the claim, as indicated by its data stamp on the claim. The date of payment is the date of the check or other form of payment. 2. The PBM and PHARMACY may, by mutual agreement, establish an alternative payment schedule to the one presented. 3. PHARMACY shall accept payment made by the PBM as payment-in-full for covered services and Additional Services provided and shall not solicit or accept any surety or guarantee of payment from the Medicaid MCO Member, except a specifically allowed by Subsection F, Member Billing, of this Section. 4. This Agreement shall not contain any provision which provides incentives, monetary or otherwise, for the withholding of Medically Necessary Services. Any incentive plans for providers shall be in compliance with 42 CFR Part 434 (2009, as amended), 42 CFR §417.479 (2008, as amended), 42 CFR §422.208 and 42 CFR §422.210 (2008, as amended). 12.3 Florida Regulatory Addendum This Addendum applies to all HMO, HMO Medicaid and/or Florida Medicaid Covered Person pharmacy services and otherwise as applicable in accordance with federal, state or local law. A. General Provisions 1. Pharmacy must give 60 days’ advance written notice to PBM and the Florida Department of Insurance before cancelling the Agreement for any reason. Nonpayment for goods or services rendered by Pharmacy to the PBM is not a valid reason for avoiding said 60 days’ advance notice of cancellation. Page 80 Magellan Health Services Provider Manual 2. Covered Persons are not liable to the Pharmacy for any services for which the PBM is liable. 3. PBM will provide 60 days' advance written notice to Pharmacy and the Florida Department of Insurance before canceling, without cause, the Agreement, except in a case in which a patient's health is subject to imminent danger or Pharmacy's ability to practice is effectively impaired by an action by the Board of Pharmacy or other governmental agency. 4. Upon receipt by PBM of a 60-day cancellation notice, PBM may, if requested by the Pharmacy, terminate the Agreement in less than 60 days if PBM is not financially impaired or insolvent. 5. The Agreement may be cancelled upon issuance of an order by the Florida Department of Insurance pursuant to applicable Florida law. 6. Pharmacy will not bill or otherwise see reimbursement from or recourse against any Covered Person, with the exception of any supplemental charges or coinsurance amounts as stated in the Covered Person’s Benefit Plan. 7. Claims by Pharmacy for pharmacy services are to be submitted in accordance with the Agreement. Pharmacy may call 1-800-651-8921 if Pharmacy has any questions and concerns regarding claims addressed PBM will provide no less than 30 calendar days’ (or such shorter period if allowed by law) prior written notice of any changes to the information contained in this paragraph. 8. Nothing in the Agreement shall be construed as restricting Pharmacy's ability to communicate information to a Covered Person regarding medical care or treatment options for the Covered Person when PBM deems knowledge of such information by the Covered Person to be in the best interest of the health of the Covered Person. 9. Authorization for pharmacy services to a Covered Person will be made in accordance with the Agreement. Unless allowed otherwise by law, PBM will give written notice to Pharmacy prior to any change in such authorization of pharmacy services procedures. 10. Pharmacy will comply with all flow-down provisions, as applicable, contained in any Florida Medicaid contract(s) entered into by PBM. 11. Pharmacy will post a consumer assistance notice prominently displayed in the service area of the Pharmacy and clearly noticeable by all Covered Persons. The consumer assistance notice must state the addresses and toll-free telephone numbers of the Florida Agency for Health Care Administration, the Subscriber Assistance Program and the Florida Department of Financial Services. The consumer assistance notice must also clearly state that the address and toll-free telephone number of PBM’s grievance department will be provided upon request. PBM’s grievance number is 1-800=651-8921. 12. Pharmacy represents and warrants it is eligible for participation in the Florida Medicaid program. Confidential and Proprietary Page 81 Provider Manual B. 13. Pharmacy will provide all information requested to substantiate its compliance with the requirements of the Agreement including without limitation this Addendum. Hernandez Settlement 1. Pharmacy will comply with the Hernandez Settlement Agreement (“HSA”). A HSA situation arises when a Covered Person attempts to fill a prescription at a participating pharmacy location and is unable to receive his/her prescription as a result of: a. An unreasonable delay in filling the prescription; b. A denial of the prescription; c. The reduction of a prescribed good or service; and/or d. The termination of a prescription. 2. The parties to the HSA recognized the importance of providing Florida Medicaid recipients with written information explaining why Medicaid reimbursement of a prescription claim has been rejected. It was further recognized in the HSA that in the vast majority of cases these rejections are due to reasons that can be promptly corrected, and that the Medicaid recipient needs to know the reason for the rejection and what she or he can do to resolve it. Accordingly, it is required by the HSA that the following be done by the Pharmacy and Pharmacy agrees to do the following: a. Pharmacy will post signs advising Medicaid recipients that if reimbursement for their prescription drug(s) is initially rejected, they will be given written information by the Pharmacy, including a pamphlet, that will tell them the reason their drug claim reimbursement was rejected and what they can do about it. b. Pharmacy will provide notice to Medicaid recipients whose claim reimbursement for a prescription drug is rejected by way of either a printed copy of the computer screen stating the reason(s) for the rejection or by writing the reason(s) for claim reimbursement rejection and the date of the rejection on the pamphlet which will be given to the Medicaid recipient. c. For those Medicaid recipients not physically present in the pharmacy when Medicaid claim reimbursement is rejected for the Medicaid recipient’s claim, such as Medicaid recipients who have a relative pick up medicines for them, Pharmacy must deliver the pamphlet (and copy of computer screen, where appropriate), containing the reason(s) for rejection to the Medicaid recipient via the same means by which the prescription medication would have delivered, e.g., mail, personal delivery. d. The above stated notice can either be provided to the Medicaid recipient or to a person acting on behalf of a Medicaid recipient as specified in the Health Page 82 Magellan Health Services Provider Manual Insurance Portability and Accountability Act of 1996 (“HIPAA”), and said notice shall be made in accordance with existing law and HIPAA procedures. e. Pharmacy will provide all Medicaid recipients whose prescription drug claim reimbursement has been rejected with a copy of the pamphlet, which pamphlet is available from the Agency for Health Care Administration of the State of Florida. Confidential and Proprietary Page 83 Provider Manual 13.0 Index A Appendix, 34, 37, 39, 44, 80, 81 B Billing Overview, 13 C Call Center, 9, 32, 33, 43 Claim Format, 30, 34 Claim Formats, 30, 34 Claims, 32, 34, 35, 36, 40, 44, 46, 69 Compound, 37, 69, 83, 87, 89, 90, 91 Contact, 9, 34, 42, 87 Coordination of Benefits, 73, 84 D Data Elements, 35, 91 Diagnosis, 84, 85, 90, 91 Dispensing, 34, 47, 87, 88, 90 Dispensing Limits, 47 E Enrolling, 13 P Point-of-Sale, 30, 34, 82 POS, 30, 34, 35, 42, 44, 46, 70 Prior Authorizations, 32, 37, 50 Program Specifications, 46 Page 84 Magellan Health Services Provider Manual Q Quantity, 47, 87, 88 S Support, 9, 32, 33, 42, 43, 82 T Transaction, 35, 36, 42, 82, 85, 86, 89, 90, 91 U Universal Claim Form, 34, 39 W Website, 30 Confidential and Proprietary Page 85
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