Original Notice.

Preproposal statement of inquiry was filed as WSR 00-07-087.

Title of Rule: New WAC 388-530-1125 Drug rebate program, 388-530-1410 Federal upper limit (FUL) methodology, 388-530-1425 Payment methodology for drugs purchased under the Public Health Service (PHS) Act, 388-530-1625 Compliance packaging services; and amending WAC 388-530-300 General reimbursement methodology, 388-530-1350 Estimated acquisition cost methodology, 388-530-1400 Maximum allowable cost methodology, 388-530-1450 Dispensing fee information, 388-530-1500 Reimbursement for compounded prescriptions, 388-530-1550 Unit dose drug delivery systems, 388-530-1600 Unit dose pharmacy billing requirements, 388-530-1650 Reimbursement for pharmaceutical supplies, and 388-530-1700 Drugs and pharmaceutical supplies from nonpharmacy providers.

Purpose: To update rule to reflect current department policy and practice and to comply with the Governor's Executive Order 97-02.

Statutory Authority for Adoption: RCW 74.08.090, 74.04.050.

Statute Being Implemented: RCW 74.08.090, 74.04.050.

Summary: The proposed rules regarding pharmacy-related reimbursement reflect current department policy and practice. New sections codify current policy for the drug rebate program; payment methodology for federal upper limit (FUL), for drugs purchased under the Public Health Service (PHS) Act, and for compliance packaging. The amended sections reflect updated policy, and all sections have been written to comply with the clear writing standards in the Governor's Executive Order 97-02.

Reasons Supporting Proposal: To ensure current policy and practice is reflected in rule, and to comply with the Governor's Executive Order 97-02.

Name of Agency Personnel Responsible for Drafting: Ann Myers, DPS/RIP, P.O. Box 45533, Olympia, WA 98507-5533, (360) 725-1345; Implementation and Enforcement: Ayuni Wimpee, DOSS/PRS, P.O. Box 45510, Olympia, WA 98507-5510, (360) 725-1835.

Name of Proponent: Department of Social and Health Services, Medical Assistance Administration, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: The proposed rules codify existing department policy regarding pharmacy-related reimbursement methodology. The purpose is to comply with requirements to put reimbursement methodology in rule. The anticipated effect is to clearly reflect department policy so it is understood by those to whom it applies.

Proposal Changes the Following Existing Rules: The rules proposed update language and clarify existing policy.

No small business economic impact statement has been prepared under chapter 19.85 RCW. The department has analyzed the proposed rules and concludes that they will have a no more than a minor impact on the businesses affected by them; therefore no small business economic impact statement is required.

RCW 34.05.328 does not apply to this rule adoption. The department has analyzed the proposed rules and concludes that they do not meet the definition a "significant legislative rule."

Hearing Location: Lacey Government Center (behind Tokyo Bento Restaurant), 1009 College Street S.E., Room 104-B, Lacey, WA 98503, on September 26, 2000, at 10:00 a.m.

Assistance for Persons with Disabilities: Contact Kelly Cooper, Rules Coordinator, by September 19, 2000, phone (360) 664-6094, TTY (360) 664-6178, e-mail coopeKD@dshs.wa.gov.

Submit Written Comments to: Identify WAC Numbers, Kelly Cooper, Rules Coordinator, Rules and Policies Assistance Unit, P.O. Box 45850, Olympia, WA 98504-5850, fax (360) 664-6185, by September 26, 2000.

Date of Intended Adoption: No sooner than September 27, 2000.

July 8, 2000

Marie Myerchin-Redifer, Manager

Rules and Policies Assistance Unit

(1) MAA covers only those outpatient prescription drugs supplied by manufacturers who have a drug rebate contract with the Health Care Financing Administration (HCFA). MAA may make exceptions on a case-by-case basis. Exceptions require prior authorization, refer to WAC 388-501-0165.

     (2) MAA may negotiate separate, additional discounts with manufacturers to facilitate formulary management.

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(1) ((Where the department has not contracted for pharmacy services through competitive procurement, the department shall ensure)) MAA's total reimbursement for a prescription drug ((does)) must not exceed the lowest of:

     (a) Estimated acquisition cost (EAC) plus a dispensing fee;

     (b) Maximum allowable cost (MAC) plus a dispensing fee; ((or))

     (c) Federal Upper Limit (FUL) plus a dispensing fee;

     (d) Actual acquisition cost (AAC) plus a dispensing fee for drugs purchased under section 340 B of the Public Health Service (PHS) Act and dispensed to medical assistance clients; or

     (e) The provider's usual and customary charge to the non-Medicaid population.

     (2) ((If the provider offers a discount, rebate, promotion or other incentive which directly relates to the reduction of the price of a prescription to the individual non-Medicaid customer, the provider shall similarly reduce its charge to the department for the prescription.

     (3) The department shall choose)) MAA selects the in-state pharmaceutical wholesalers used to set EAC and MAC.

     (((4) The department)) (3) MAA may solicit assistance from representative pharmacy providers ((in)) , through their state associations, when establishing ((MAC and/or)) EAC and/or MAC.

     (4) If the pharmacy provider offers a discount, rebate, promotion or other incentive which directly relates to the reduction of the price of a prescription to the individual non-Medicaid customer, the provider must similarly reduce its charge to MAA for the prescription.

     (5) If ((the)) a pharmacy gives a product ((is given)) free to the general public, the pharmacy ((shall)) must not submit a claim to ((the department if the product is given)) MAA when giving the free product to a medical assistance client.      ((If the product is sold at a discount to the general public, the pharmacy shall ensure any claim to the department for that product shall reflect the discounted charge.))

[Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1300, filed 10/9/96, effective 11/9/96.]

((The department shall determine estimated acquisition cost (EAC) as follows:

     (1) Periodically, the department shall)) MAA determines EAC as follows:

     (1) No more than once every three years and no less than once every ten years, MAA:

     (a) ((Take a sample of, at)) Takes a minimum((,)) sample of two hundred fifty of the top national drug codes (NDCs) paid ((for by the)) by MAA, excluding drugs under the MAC program; and

     (b) Determines pharmacies' average acquisition costs for these products.

     (2) ((The department shall decide the sampling frequency of the top drug products by dollar volume under medical assistance to determine EAC, but the frequency shall not be:

     (a) More than once every three years; and

     (b) Less than once every ten years.

     (3))) The pharmacies' average acquisition cost for the products in the NDC sample ((shall be)) is based on in-state wholesalers' ((published prices)) charges to pharmacy subscribers((, plus an average subscriber upcharge, if applicable.

     (4))).

     (3) MAA ((shall express)) represents the average acquisition cost for each product on the sample list ((during the period under study)) as a percentage of the average published wholesale price (AWP), determined for that product by ((the department's)) MAA's drug pricing file contractor.

     (((5))) (4) MAA ((shall)) averages the percentages obtained ((for)) from the sample, and ((the resulting percentage shall represent the estimated acquisition cost (EAC))) that average represents the EAC.

     (((6) MAA may base EAC on standard package size or the price of the actual package size dispensed.

     (7))) (5) MAA may set EAC for specified drugs or drug categories at a percentage of AWP ((percentages)) other than ((those)) that determined in subsection (((5))) (4) of this section when MAA ((deems)) considers it necessary.      MAA ends the ((department shall cease such)) exemption when it considers the necessity no longer exists.

     (((8) The department shall pay at EAC the brand name and generic drugs with an MAC established if the EAC)) MAA pays EAC for a drug with an established MAC when the EAC for the particular drug is lower than the MAC price.

     (6) MAA bases EAC drug reimbursement on the actual package size dispensed.

[Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1350, filed 10/9/96, effective 11/9/96.]

(1) ((When the department determines there is a likelihood that a cost savings will result the department may establish)) MAA establishes a maximum allowable cost (MAC) for a multiple-source drug which is available from at least three manufacturers/labelers.

     (2) ((The department)) MAA may exclude from MAC selected multiple-source drugs when clinical response significantly differs between brand and generic equivalents.

     (3) ((The department shall)) MAA determines the MAC for a multiple-source drug by:

     (a) ((Generating a manufacturers/labelers list for a multiple-source drug from data provided by the drug pricing file contractor;

     (b) Ensure the list is arranged by cost, showing wholesalers' national actual acquisition cost (NAAC) for the drug from each manufacturer/labeler;

     (c) If there is a Federal Upper Limit (FUL) for the multiple-source drug, the FUL shall be adopted, except, if the FUL is lower than the pharmacies' actual acquisition cost (AAC) for an available product based on information provided by representative pharmacy providers, a MAC shall be chosen in cooperation with the representative pharmacy providers.      The chosen fee shall be the lowest amount sufficient to cover in-state pharmacies' AAC based on information provided by the representative pharmacy providers;

     (d) Establish estimated acquisition cost (EAC) of the third lowest priced product as the recommend MAC, except:

     (i) If the MAC established is lower than pharmacies' AAC for the three lowest priced products, based on information provided by the representative pharmacy providers, a MAC shall be chosen in cooperation with the representative pharmacy providers.      The chosen fee shall be the lowest amount sufficient to cover in-state pharmacies' average acquisition cost based on information provided by the representative pharmacy providers; or

     (ii) A MAC may be established for a drug using the maximum allowable cost set by another third party for that drug)) Obtaining copies of in-state wholesalers' product catalogs;

     (b) Identifying what products are available from each in-state wholesaler for each MAC drug;

     (c) Determining the average pharmacy subscriber's acquisition costs for these products;

     (d) Ranking the products in descending order by acquisition cost; and

     (e) Establishing the MAC at a level which gives most pharmacists access to two products.

     (4) MAA may establish a MAC for a drug using the maximum allowable cost set by another third party for that drug.

     (5) The MAC established for a multiple-source drug ((shall)) does not apply if the ((prescriber certifies)) written prescription identifies that a specific brand is (("))medically necessary((")) for a particular client.      In such cases EAC ((shall apply)) for the particular brand applies, provided prior authorization is obtained from MAA as specified under WAC ((388-530-1250 (6)(a))) 388-530-1250(5), Prior authorization.

     (((5) The department shall))

     (6) The MAC established for a multiple-source drug applies to all package sizes of that drug, except those identified as unit dose NDCs by the manufacturer(s) of the drug.

     (7) MAA pays the EAC for a multiple-source product if the EAC for ((a multiple-source)) that product is less than the MAC established for ((that product)) the drug.

     (((6))) (8) The automated maximum allowable cost (AMAC) pricing ((shall apply)) applies to multiple-source drugs:

     (a) ((Not identified under subsection (2) of this section;

     (b))) Produced by three or more manufacturers/labelers ((under)) at least one of which must have a federal drug rebate agreement; and

     (((c))) (b) Which are not on the MAC list.

     (((7))) (9) AMAC reimbursement for all products within a generic code number (GCN) sequence ((shall be)) is at the EAC of the third lowest priced product in that sequence, or the EAC of the lowest priced drug under a federal rebate agreement in that sequence, whichever is higher.

     (((8) If the established AMAC price exceeds the FUL, the department shall set the price at the FUL.

     (9) The department shall pay the estimated acquisition cost (EAC)))

     (10) For a multiple-source product under AMAC, MAA pays the EAC if the EAC for ((a)) the multiple-source product is less than the AMAC established for that product.

     (((10) MAA shall))

     (11) MAA recalculates AMAC each time there ((are)) is a pricing update((s)) provided by the drug file contractor to any product in GCN sequences ((covered under the AMAC program.

     (11) The department shall ensure the maximum payment for multiple-source drugs for which HCFA has set a FUL does not exceed, in the aggregate, the prescribed upper limits plus the dispensing fees set by the department)).

[Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1400, filed 10/9/96, effective 11/9/96.]

(1) MAA adopts the federal upper limit (FUL) set by the Health Care Financing Administration (HCFA) unless a lower MAC is already in place for the multiple source drug.

     (2) MAA pays the EAC for a multiple source product if the EAC for that product is less than the FUL established for that drug.

     (3) MAA's maximum payment for multiple source drugs for which HCFA has set a FUL will not exceed, in the aggregate, the prescribed upper limits plus the dispensing fees set by MAA.

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(1) Drugs purchased under section 340B of the Public Health Service (PHS) Act and dispensed to medical assistance clients must be billed using the actual acquisition cost (AAC) of the drug plus the appropriate dispensing fee.

     (2) Drugs provided or dispensed by other specified providers must be billed using AAC. See WAC 388-530-1700.

     (3) AAC includes allowances or discounts for volume purchases, purchasing cooperatives, and advertising or other promotional allowances.

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Subject to the provisions of WAC 388-530-1300, MAA ((shall pay)) pays a dispensing fee for each covered prescription.

     (1) ((The department shall adjust)) MAA adjusts the dispensing fee by ((weighing)) considering factors including, but not limited to:

     (a) Legislative appropriations for vendor rates;

     (b) Input from provider and/or advocacy groups;

     (c) Input from state-employed or contracted actuaries; and

     (d) Dispensing fees paid by other third-party payers, including, but not limited to, health care plans and other states' Medicaid agencies.

     (2) ((The)) MAA ((shall use)) uses a tiered dispensing fee system which reimburses ((large)) higher volume pharmacies at a lower fee and small volume pharmacies at a ((larger)) higher fee((.      In MAA's judgment such a system best preserves or enhances clients' access to services by promoting equitable payment to pharmacy providers)).

     (3) ((In a tiered dispensing fee system, the MAA shall use)) MAA uses total annual prescription volume (both Medicaid and non-Medicaid) reported to ((the department to determine each pharmacy's dispensing fee category)) MAA to determine each pharmacy's dispensing fee tier.

     (a) A pharmacy which fills more than thirty-five thousand ((and one or more)) prescriptions annually ((shall be)) is a high-volume pharmacy.

     (b) A pharmacy which fills between fifteen thousand ((and)) one and thirty-five thousand prescriptions annually ((shall be)) is a mid-volume pharmacy.

     (c) A pharmacy which fills fifteen thousand or fewer prescriptions annually ((shall be)) is a low-volume pharmacy.

     (4) ((The department shall)) MAA determines a pharmacy's annual total prescription volume as follows:

     (a) ((The department shall)) MAA sends out a prescription volume survey form to pharmacy providers during the first quarter of the calendar year;

     (b) Pharmacies ((shall)) return completed prescription volume surveys to ((the department)) MAA by the date specified ((by the department each year.      The department shall assign)). Pharmacy providers not responding to the survey by the specified date are assigned to the high volume category;

     (c) Pharmacies ((shall:

     (i))) must include all prescriptions dispensed from the same physical location in the pharmacy's total prescription count((; and

     (ii) Report totals from the same location to the department on the same form.      Hospital-based pharmacies which serve both inpatient and outpatient clients shall not include hospital inpatient doses/prescriptions in the total volume reported to the department.      The department shall deem prescriptions dispensed to nursing facility clients outpatient prescriptions;

     (d) If a pharmacy uses more than one provider number to bill MAA for pharmacy claims dispensed from the same physical location, the pharmacy shall list on one form all of the provider numbers contributing to the total volume being reported;

     (e) Reassignment to current or assignment to new dispensing fee categories shall be effective on the first of the month following the date specified by the department for receipt of completed prescription volume survey forms.

     (5) In a tiered dispensing fee system,));

     (d) Hospital based pharmacies which serve both inpatient and outpatient clients are not required to include hospital inpatient doses/prescriptions in the total volume reported to MAA;

     (e) MAA considers prescriptions dispensed to nursing facility clients as outpatient prescriptions;

     (f) Assignment to a new dispensing fee tier is effective on the first of the month following the date specified by MAA.

     (5) A pharmacy may request a change ((to a lower volume category)) in dispensing fee tier during the interval between the annual prescription volume surveys.      The pharmacy ((shall support)) must substantiate such a request with documentation showing that the pharmacy's most recent six-month dispensing data, annualized, would qualify the pharmacy for ((a lower volume category)) the new tier. If MAA receives the documentation by the twentieth of the month, assignment to a new dispensing fee tier is effective on the first of the following month.

     (6) ((MAA may adopt a uniform dispensing fee if in its judgment such a system would best preserve or enhance clients' access to services by promoting equitable payment to pharmacy providers.

     (7) The department shall grant)) MAA grants general dispensing fee rate increases only when authorized by the legislature.      Amounts authorized for dispensing fee increases may be distributed nonuniformly (e.g., tiered dispensing fee based upon volume)((, if necessary, to ensure client access)).

[Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1450, filed 10/9/96, effective 11/9/96.]

(1) ((Notwithstanding the definition in WAC 388-530-1050(7), the department shall)) MAA does not consider reconstitution to be compounding.

     (a) ((The department)) MAA may consider the act of combining two or more active ingredients or the adjustment of therapeutic strengths and/or forms by a pharmacist in the preparation of a prescription to be compounding if the client's drug therapy needs are unable to be met by commercially available dosage strengths and/or forms of the medically necessary drug.

     (b) The pharmacist ((shall)) must ensure the need for the adjustment of the drug's therapeutic strength and/or form is well documented in the client's file.

     (2) Compounded prescriptions ((shall be)) are reimbursed as follows:

     (a) ((The department shall allow)) MAA allows only the lowest cost for each formulary ingredient((.)) whether EAC, MAC, or amount billed ((shall apply)).

     (b) ((The department shall apply)) MAA applies current prior authorization requirements to drugs used as ingredients in compounded prescriptions, except as provided under subsection (2)(c) of this section.      MAA ((shall deny)) denies payment for a drug requiring prior authorization used((:

     (i))) as an ingredient in a compounded prescription((; but

     (ii) For which)) when prior authorization was not obtained.

     (c) ((The department)) MAA may designate selected drugs as not requiring prior authorization when used for compounded prescriptions, but requiring prior authorization for other uses((.      The department shall publish such lists periodically)) Refer to the pharmacy billing instructions.

     (d) ((The department shall give)) MAA reimburses a dispensing fee as described under WAC 388-530-1450 for:

     (i) Each formulary or prior authorized drug ingredient billed separately(( a dispensing fee set by the department as described under WAC 388-530-1450)); and

     (ii) Drugs used in compounding under subsection (2)(c) of this section ((a dispensing fee set by the department as described under WAC 388-530-1450)).

     (e) MAA ((shall)) does not pay a separate fee for compounding time.      ((MAA shall replace the fee for compounding time with a dispensing fee for each ingredient, as described under WAC 388-530-1450.))

     (3) In addition to reimbursement for ingredient and dispensing fees, MAA ((shall set)) may set maximum allowable fees, called compounded prescription preparation fees, for special procedures, equipment, or supplies used in compounding prescriptions((.      MAA shall call these fees compounded prescription preparation fees)).

     (a) The pharmacy ((shall)) must note in its records any necessary special procedures, equipment ((or)), supplies, or containers used in preparing the compounded prescription.

     (b) MAA ((shall adjust)) adjusts compounded prescription preparation fees by ((taking into account)) considering factors including, but not limited to:

     (i) Legislative appropriations for vendor rates;

     (ii) Input from provider and/or advocacy groups;

     (iii) Audit findings regarding costs of compounding equipment and supplies, as specified in subsection (((5))) (4) of this section; and

     (iv) Compounded prescription preparation fees paid by other third-party payers, including but not limited to health care plans and other states' Medicaid agencies.

     (c) MAA ((shall)) does not reimburse compounded prescription preparation fees for infusion ((productions)) products; MAA reimbursement for home infusion and other intravenous admixtures ((shall be for)) is limited to ingredient costs and dispensing fees only.

     (d) MAA ((shall reimburse)) reimburses pharmacies for only one preparation fee for each compounded prescription.

     (e) Pharmacies ((shall)) bill MAA for compounded prescription preparation fees using state-assigned drug codes, which MAA ((shall publish)) publishes periodically in the pharmacy billing instructions.

     (f) ((MAA shall ensure)) A separate dispensing fee does not apply to the state assigned drug preparation fee codes.

     (4) ((MAA shall periodically sample ten percent of pharmacy claims for compounded drugs.      The MAA pharmacist consultant shall review these claims to determine if the drugs were appropriately dispensed in compounded form, or if less costly equivalent alternative preparations were already available commercially.      If MAA finds that a pharmacy provider is inappropriately compounding or billing for compounded drugs, MAA shall take whatever corrective action it deems necessary, including but not limited to:

     (a) Education of the provider regarding the problem practice(s);

     (b) Recoupment of payment for the compounded drug, or the differential between the compounded form and its commercially available, less costly alternative form; and/or

     (c) Termination of the provider's core provider agreement in extreme cases.

     (5) MAA may audit selected pharmacies dispensing compounded prescriptions to determine acquisition or estimated costs of equipment and/or supplies used in compounding)) MAA may audit selected pharmacies dispensing compounded prescriptions, to determine acquisition or estimated costs of equipment and/or supplies used in compounding.

[Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1500, filed 10/9/96, effective 11/9/96.]

(1) ((The department shall pay)) MAA pays for unit dose drug delivery systems only for clients residing in nursing facilities, except as provided in subsections (6) and (7) of this section.

     (2) ((The department shall pay)) Unit dose delivery systems may be true or modified.

     (3) MAA pays pharmacies that provide ((true)) unit dose delivery service ((the department's)) MAA's highest allowable dispensing fee for each prescription dispensed to clients in nursing facilities.      ((The department shall reimburse)) MAA reimburses ingredient costs for drugs under ((true)) unit dose systems at the appropriate MAC ((or EAC.      The department shall pay true)), FUL, AAC, EAC, or billed charge, whichever is lowest. MAA reimburses unit dose providers for drugs dispensed in manufacturers' unit dose packaging at the EAC for the specific unit dose NDCs.

     (((3) The department shall pay modified unit dose pharmacies the department's highest allowable dispensing fee for repackaged bulk drugs dispensed in unit dose form to clients in nursing facilities. The department shall reimburse ingredient costs for bulk drugs repackaged into unit dose form at the lesser of MAC or EAC.      The department shall deem creams, ointments, ophthalmic/otic preparations, and other liquids as not deliverable in this packaging system.))

     (4) MAA ((shall pay)) pays a pharmacy that dispenses drugs in bulk containers or multi-dose form to clients in nursing facilities the regular dispensing fee applicable to the pharmacy's total annual prescription volume ((category)) tier.      Drugs MAA considers not deliverable in unit dose form include, but are not limited to, ((oral)) liquids, creams, ointments, ophthalmic and otic solutions. ((The department shall reimburse)) MAA reimburses ingredient costs for such drugs at the ((lesser)) lowest of MAC ((or EAC)), FUL, AAC, EAC, or billed charge.

     (5) MAA ((shall pay)) pays a pharmacy that dispenses drugs prepackaged by the manufacturer in unit dose form to clients in nursing facilities the regular dispensing fee applicable to that pharmacy's total annual prescription volume ((category)) tier.      ((The department shall pay)) MAA reimburses ingredient costs at the EAC applicable to the unit dose ((national drug code ())NDC(())).

     (6) MAA ((shall pay)) reimburses for manufacturer-designated unit dose drugs dispensed to clients not residing in nursing facilities only when such drugs:

     (a) Are available in the marketplace only in manufacturer-designated unit dose packaging; and

     (b) Would otherwise have been covered outpatient drugs.      The unit dose dispensing fee ((shall)) does not apply in such cases.      MAA pays the pharmacy ((shall be paid)) the dispensing fee applicable to the pharmacy's total annual prescription volume ((category)) tier.

     (7) MAA may pay for ((modified)) unit dose delivery systems for developmentally disabled (DD) clients residing in approved community living arrangements.

[Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1550, filed 10/9/96, effective 11/9/96.]

(1) To be eligible for a unit dose dispensing fee, a pharmacy ((shall)) must:

     (a) Notify MAA in writing of its intent to provide unit dose service;

     (b) ((Specify the type of unit dose service to be provided;

     (c))) Identify the nursing facility(ies) to be served;

     (((d))) (c) Indicate the approximate date unit dose service to the facility(ies) will commence; and

     (((e))) (d) Sign an agreement to follow department requirements for unit dose reimbursement.

     (2) Under a ((true or modified)) unit dose delivery system, a pharmacy ((may)) must bill ((MAA)) only for the number of drug units ((dispensed)) actually used by the medical assistance client in the nursing facility, except as provided in subsections (3) and (4) of this section.

     (3) The pharmacy ((shall)) must submit an adjustment form or claims reversal of the charge to MAA for the cost of all unused drugs returned to the pharmacy from the nursing facility on or before the sixtieth day following the date the drug was dispensed, except as provided in subsection (4) of this section.      Such adjustment ((shall)) must conform to the nursing facility's monthly log as described in subsection (6).

     (4) ((Modified)) Unit dose providers do not have to credit MAA for ((controlled substances)) federally designated schedule two drugs which are returned to the pharmacy. These returned drugs must be disposed of according to federal regulations.

     (5) Pharmacies ((shall)) must not charge clients or MAA a fee for repackaging a client's bulk medications in unit dose form.      The costs of repackaging ((shall be)) are the responsibility of the nursing facility when the repackaging is done:

     (a) To conform with a nursing facility's drug delivery system; or

     (b) For the nursing facility's convenience.

     (6) The pharmacy ((shall)) must maintain detailed records of medications dispensed under unit dose delivery systems.      The pharmacy ((shall)) must keep a monthly log for each nursing facility served, including but not limited to the following information:

     (a) Facility name and address;

     (b) Client's name and patient identification code (PIC);

     (c) Drug name/strength;

     (d) NDC ((or labeler information));

     (e) Quantity and date dispensed;

     (f) Quantity and date returned;

     (g) Value of returned drugs or amount credited;

     (h) Explanation for no credit given or nonreusable returns; and

     (i) Prescription number.

     (7) Upon MAA's request, the pharmacy ((shall)) must submit copies of the logs referred to in subsection (6) ((on a monthly, quarterly, or annual basis)).

     (8) When the pharmacy ((shall submit annually with)) submits the completed annual prescription volume survey to MAA((:

     (a) An updated list of nursing facilities served under unit dose systems; and

     (b) The nursing facilities' respective billing period start dates)) , it must include an updated list of nursing facilities served under unit dose systems.

[Statutory Authority: RCW 74.04.050, 74.08.090, 42 CFR 447.333 and Attachment 4.19-B, Page 2-b of the State Plan under Title XIX of the Social Security Act.      98-14-005, § 388-530-1600, filed 6/18/98, effective 7/19/98.      Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1600, filed 10/9/96, effective 11/9/96.]

(1) MAA reimburses pharmacies for compliance packaging services provided to clients considered at risk for adverse drug therapy outcomes. Clients who are eligible for compliance packaging services must not reside in a nursing home or other inpatient facility, and must meet (a) and either (b) or (c) of this subsection.

     (a) Have one or more of the following representative disease conditions:

     (i) Alzheimer's disease;

     (ii) Blood clotting disorders;

     (iii) Cardiac arrhythmia;

     (iv) Congestive heart failure;

     (v) Depression;

     (vi) Diabetes;

     (vii) Epilepsy;

     (viii) HIV/AIDS;

     (ix) Hypertension;

     (x) Schizophrenia; or

     (xi) Tuberculosis.

     (b) Concurrently consume two or more prescribed medications for chronic medical conditions, that are dosed at three or more intervals per day; or

     (c) Have demonstrated a pattern of noncompliance that is potentially harmful to their health.

     (2) Compliance packaging services include:

     (a) Reusable hard plastic containers of any type (e.g., medisets); and

     (b) Nonreusable compliance packaging devices (e.g., blister packs).

     (3) MAA pays a filling fee and reimburses pharmacies for the compliance packaging device or container. The frequency of fills and number of payable compliance packaging devices per client is subject to limits specified by MAA. MAA does not pay filling or preparation fees for blister packs.

     (4) Pharmacies must use the HCFA-1500 claim form to bill MAA for compliance packaging services.

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(1) The medical assistance administration (MAA) ((shall pay)) reimburses for covered pharmaceutical supplies not already included in other payment systems.

     (2) MAA ((shall base)) bases reimbursement of pharmaceutical supplies on MAA-published fee schedules.

     (3) MAA ((shall use)) uses any or all of the following methodologies to set the maximum allowable for a pharmaceutical device/supply:

     (a) Pharmacy provider's acquisition cost.      Upon review of the claim, MAA may require an invoice which must show the name of the drug, the manufacturer, drug strength, and cost;

     (b) Medicare's reimbursement for the item; or

     (c) A specified discount off the item's list price or manufacturer's suggested retail price (MSRP).

[Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1650, filed 10/9/96, effective 11/9/96.]

(1) The medical assistance administration (MAA) ((shall pay)) reimburses for covered drugs and supplies dispensed or administered by nonpharmacy providers under specified conditions. MAA does not reimburse providers for the cost of vaccines obtained through the state department of health; MAA does pay a fee for administering the vaccine.

     (2) MAA ((may pay)) reimburses actual acquisition cost (AAC) to a physician or ARNP for a covered drug (oral, topical or injectable) prepared or packaged for individual use and ((dispensed)) provided or administered to a client during an office visit.      When the cost of the drug ((dispensed)) provided or administered to the patient exceeds the established fee, the physician or ARNP may submit to MAA a photocopy of the invoice for the actual drug cost.      The invoice ((shall)) must show the name of the drug manufacturer, drug strength, and ((dosage)) cost.

     (3) ((MAA shall not reimburse providers for the cost of vaccines obtained by the provider through the state department of health.      However, MAA shall pay the provider a set fee established at twenty to thirty-five percent of the fee for a brief office visit for administering the vaccine.

     (4) MAA may pay AAC to)) MAA reimburses family planning clinics their AAC for birth control pills and contraceptive supplies ((the clinics distribute)) distributed to clients.      MAA may request an invoice for the actual cost of the drug.      If an invoice is requested, ((the clinic shall ensure)) the invoice ((shows)) must show the name of the drug, manufacturer, drug strength, and ((dosage)) cost.

     (5) MAA ((shall determine)) reimburses drugs and supplies provided to clients by local health departments ((are reimbursed)) according to ((MAA's)) its established fee schedules.

[Statutory Authority: RCW 74.08.090.      96-21-031, § 388-530-1700, filed 10/9/96, effective 11/9/96.]

Reviser's note: The typographical error in the above section occurred in the copy filed by the agency and appears in the Register pursuant to the requirements of RCW 34.08.040.

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