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Self-administered drugs may cause trouble

Pharmacy Regulation Resource, October 26, 2005

Hospital outpatient departments are in for a rude shock on the first day of the new Medicare Part D prescription drug plan: Patients complaining that their outpatient self-administered drugs aren't covered under the new benefit.

It's a serious operational and public relations issue, and one that Valerie Rinkle, MPA, revenue cycle director for Asante Health System in Medford, OR, knows all too well. Rinkle has spent the last several months trying to warn the Centers for Medicare & Medicaid Services (CMS) and her local congressman of the impending problem as the January 1, 2006, deadline approaches, but to no avail.

"Hospitals should anticipate beneficiary phone calls with patient complaints," Rinkle says.

Rinkle says most hospitals will assume that these drugs are an out-of-network benefit, which means the beneficiary pays the hospital, then takes the invoice and sends it to the prescription drug plan to receive reimbursement.

But here's the catch-most hospital invoices read simply "Pharmacy, unit of five, $15," for example, and without detail about the drugs themselves, the prescription drug plan won't reimburse them.

Tip: Develop a letter that prints out each time a Medicare outpatient registers at your facility. The letter should disclose that the self-administered drugs won't be covered.

Rinkle recommends the letter state something to the effect of: "We're excited that you may have elected to enroll in the new Part D Medicare prescription drug plan. Please be aware that our hospital is still obligated to bill you directly for prescription and over-the-counter drugs administered to you during your visit to our hospital. You can file an out-of-network claim to your new prescription drug plan to be reimbursed for these drugs."

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