Pharmacy Provider Procedure Manual

Last Updated

1. Introduction

P-1.1. Manual Overview

The Pharmacy Provider Procedure Manual (PPPM) is a comprehensive resource for pharmacy providers enrolled with the Texas Health and Human Services Vendor Drug Program (VDP). The PPPM contains information about benefits, policies, and procedures for outpatient pharmacy claims and rebate processing.

The PPPM is divided into the following sections:

  1. Introduction
  2. Contact Information
  3. Enrollment
  4. Managed Care
  5. System Requirements
  6. Eligibility
  7. Coordination of Benefits
  8. Drug Policy
  9. Home Health Supplies
  10. Vitamins and Minerals
  11. Mosquito Repellant
  12. Drug Utilization Review
  13. Prior Authorization
  14. Pricing and Reimbursement
  15. 340B Resources
  16. Payment
  17. Audits
  18. Rebates
  19. Documents and Forms

P-1.2. Mission

The mission of the Texas Vendor Drug Program is to:

  • Provide statewide access to covered outpatient drugs and quality pharmaceutical care for people enrolled in Medicaid, the Children’s Health Insurance Program (CHIP), the Children with Special Health Care Needs Services Program (CSHCN), the Healthy Texas Women Program (HTW), and the Kidney Health Care Program (KHC) in an efficient and cost-effective manner;
  • Manage the drug formulary, preferred drug list, clinician administered drug program, and rebate programs to maximize revenue, and;
  • Manage the Texas Medicaid Electronic Health Record (EHR) and Incentive/Promoting Interoperability (PI) Program, providing incentive payments to eligible Medicaid providers and hospitals when they adopt and meaningfully use certified electronic health record technology.

P-1.3. History

Congress established the Texas Medical Assistance Program, or Medicaid, under Title XIX of the Social Security Act of 1965 to pay medical bills for low-income persons who had no other way to pay for care.  The program began Sept. 1, 1967, under the provisions of Title XIX (Medicaid) of the 1965 Amendments to the Social Security Act and SB 2, The Medical Assistance Act of 1967. The Texas Medicaid drug benefit has been an optional service available to all people enrolled in Texas Medicaid since Sept. 1, 1971.

Date Event

Sept. 1, 1971

Vendor Drug Program begins

July 1, 1993

Creation of in-house electronic claims management system to allow for online, real-time claim processing

Sept. 1, 1999

Outpatient drugs provided through the CSHCN and KHC Programs are paid through VDP

March 1, 2002

Outpatient drugs provided through the CHIP program are paid through VDP

Feb. 23, 2004

Preferred drug list

Aug. 16, 2004

Clinical and therapeutic prior authorizations

Jan. 1, 2006

Medicare Part D benefit

Jan. 20, 2009

Real-time coordination of benefits

March 1, 2012

Most Medicaid managed care and all CHIP eligible clients receive prescription benefits through managed care organizations

Oct. 1, 2017

HHSC moved oversight of the clinician-administered drug (CAD) benefit to VDP.

P-1.4. Rules and Statutes

VDP is subject to federal and state policies, procedures, rules, and regulations, among them:

  • Texas Administrative Code
    • A compilation of all agency rules in Texas
  • Texas Government Code
    • The codification of the state government's general and permanent statutes
  • United States Code of Federal Regulations
    • The codification of the general and permanent rules and regulations published by the executive departments and agencies of the federal government of the United States

Refer to these rules and statutes on the VDP website Rules and Statutes page (txvendordrug.com/about/rules).

P-1.5. Programs

P-1.5.1. Medicaid

Medicaid is a state and federal cooperative program, authorized under Title XIX of the Social Security Act and Chapter 32 of the Texas Human Resources Code and pays for certain medical and health care costs for people who qualify.  Texas pharmacies must enroll with HHSC prior to dispensing outpatient prescriptions to people enrolled in either Medicaid managed care or traditional Medicaid. The type of Medicaid coverage a person receives depends on where the person lives and what kind of health issues the person has.  VDP is responsible for outpatient prescriptions for people enrolled in traditional Medicaid.

P-1.5.2 Children's Health Insurance Program 

Children in Texas without health insurance and who are not served by, or eligible for, other state-assisted health programs may be able to get low cost or free health coverage from the Children’s Health Insurance Program (CHIP).

  • Enrollment as a Medicaid pharmacy provider is a prerequisite for pharmacy participation in CHIP.
  • HHSC manages the CHIP formulary but all CHIP services, including prescription benefits, are delivered through managed care medical plans.

P-1.5.3. Children with Special Health Care Needs Services Program

The Children with Special Health Care Needs Services Program provides services and benefits to clients age 20 and younger who have special health care needs and people with cystic fibrosis of any age to improve their health, well-being and quality of life. It is not a Medicaid program.

Enrollment as a Medicaid pharmacy provider is a prerequisite for pharmacy participation in the CSHCN Services Program.

The program is available to people who:

  • Live in Texas
  • Are under 21 years old (or any age with cystic fibrosis)
  • Have a certain level of family income
  • Are diagnosed with a medical condition covered by CSHCN.
  • Are expected to improve or become functionally independent as a result of treatment/services.  Covered terminal conditions may be exceptions to this criteria.
  • Have a medical problem that:
    • is expected to last at least 12 months;
    • will limit one or more major life activities;
    • Needs more health care than what children usually need; and 
    • Have physical symptoms. This means that the program does not cover people with only a mental, behavioral or emotional condition, or a delay in development.

P-1.5.4. Healthy Texas Women Program

The Healthy Texas Women (HTW) Program provides access to women’s health and family planning services to eligible women, offering services to low-income women who are 15 through 44 years of age. VDP only reimburses pharmacy providers for the outpatient prescription products on the HTW formulary.  Family planning drugs and supplies are exempt from the three prescriptions-per-month limit for up to a six-month supply.  The program does not cover emergency birth control.

The HTW Program consolidates the former Texas Women’s Health Program (TWHP) and Expanded Primary Health Care (EPHC) Program.

Enrollment as a Medicaid pharmacy provider is a prerequisite for pharmacy participation in the HTW Program.

P-1.5.5. Kidney Health Care Program

The Kidney Health Care (KHC) Program helps people with end-stage renal disease receive health care services, and helps with dialysis treatments, access surgery, prescriptions, travel to health care visits, and Medicare premiums. The program’s drug benefit assists with costs for 4 covered drugs per month and coordinates with Medicare Part D on deductibles, co-insurance amounts, and Part D gap (or "donut hole”) expenditures, where the person is responsible for 100 percent of drug costs.

People eligible for Medicaid are not eligible for KHC drug benefits. Benefits available to people enrolled in KHC are dependent on treatment status and eligibility for benefits from other programs such as Medicare, Medicaid, or private insurance, and availability of funds. This may mean that some people may not have a drug benefit.

Enrollment as a Medicaid pharmacy provider is a prerequisite for pharmacy participation in the KHC Program.

P-1.6. Communication

P-1.6.1. Email Notification Service

The Texas HHS email notification service sends announcements to subscribers about VDP news and information. To receive messages, you must provide the following information:

  • email address
  • delivery preference (immediate, daily, or weekly updates)
  • password (optional)

Subscribers then select the topics of subscriptions they want to receive. After subscribing, the service sends a validation email to your email account. You may change your subscription profile or unsubscribe from any mailing list at any time.

P-1.7. Education

Pharmacies enrolled with Medicaid are in a unique position to help individuals with their pharmacy benefits. Pharmacy staff needs to know what pharmacy items Medicaid pays for, which products require prior authorization, and who to contact with questions about claim processing.

P-1.7.1. Continuing Education Modules

Texas Health Steps offers more than 40 continuing education courses accredited by the Accreditation Council of Pharmacy Education (ACPE). Pharmacy-related continuing education modules include the following:

  • Pharmacy (txhealthsteps.com/493-pharmacy)
    • This module equips pharmacists and pharmacy staff in delivering outpatient pharmacy services to people enrolled in Texas Medicaid, Children’s Health Insurance Program, Children with Special Health Care Needs Services Program, Healthy Texas Women Program, and Kidney Health Care Program.

P-1.7.2. Quick Courses

Texas Health Steps quick courses are short, targeted training modules available to anyone.  Most take 15 minutes or less to complete and do not offer continuing education credit. Pharmacy-related quick-courses include the following:

P-1.7.3. Downloadable materials

We encourage pharmacy staff to download the following materials, display them within the pharmacy, and reproduce them for staff education.

Document Name Revision Date
Dispensing 72-hour Emergency Prescriptions Instructions July 2019
Mosquito Repellent Benefit Information July 2019
Pharmacy Resources for Managed Care Information July 2019
Real-time Eligibility Verification Information July 2019

Refer to the Education Documents section to download.

P-1.7.4. TMHP Learning Management System

The TMHP Learning Management System is an education portal where providers can learn about all things Texas Medicaid. To access the LMS, providers must register and obtain a username. Refer to the LMS Registration and Navigation Job Aid to learn more about creating an account and navigating the LMS.

Pharmacy-related computer-based training (CBT) modules include the following:

  • Durable Medical Equipment 
    • The Pharmacy DME CBT provides DME and pharmacy DME providers information and resources necessary to enroll in Texas Medicaid as a DME provider and provide DME and supplies to Texas Medicaid clients.
  • Provider Enrollment and Management System (PEMS)
    • The PEMS CBT modules present information about PEMS and the different types of provider enrollment applications.

P-1.8. HIPAA Privacy Notice

The Health Insurance Portability and Accountability Act of 1996 (HIPAA – Public Law 104-191) protects personal health information. People have certain rights concerning their health information, including setting boundaries on how entities use the information, establishing proper safeguards, and holding violators accountable. The HIPAA Privacy regulations went into effect on April 14, 2003.

Personal health information may be verbal, written, or electronic communication created, received, or maintained by Texas HHS. It relates to the past, present, or future physical or mental health of any person.

Protected Health Information (PHI) is available to pharmacy staff daily. PHI includes any health care data plus any other identifying information allowing someone to use the data to identify a specific person. Data may consist of claim information, prior authorizations, medical records, or consent forms.

Pharmacy staff should never release PHI to anyone who does not need to know the information. If you are asked about a person's PHI and do not feel the person asking needs to know, immediately refer to your supervisor. You should discuss questions or concerns about PHI with your management.

2. Contact Information

P-2.1. Vendor Drug Program

P-2.1.1. Program Information

Mailing Address

Vendor Drug Program (MC-2250)

Texas Health and Human Services

701 W. 51st St., Austin, TX 78751

Visitor information and directions

Telephone

800-435-4165 - Pharmacy Benefits Access Help Desk

Monday to Friday, 8:30 a.m. to 5:15 p.m. (central)

This number is only for pharmacy providers. Have your pharmacy’s 10-digit National Provider Identifier (NPI) number and the appropriate cardholder ID number ready to expedite your call.

Fax

512-730-7483 - central office

512-491-1958 - help desk

Website

www.txvendordrug.com

The VDP website includes news, information, and resources needed for pharmacy participation in Texas Medicaid. All content is free, and no account is necessary to access services. We encourage all pharmacy staff to provide the proper education and instruction so your staff may take full advantage of these resources.

P-2.1.2. Pharmacy Enrollment and Support

Telephone

800-435-4165 - Pharmacy Benefits Access Help Desk

Request transfer to pharmacy enrollment section.

Fax

512-730-7477

Email

vdp-enrollment@hhsc.state.tx.us

P-2.1.3. Pharmacy Claim Processing

Telephone

800-435-4165 - Pharmacy Benefits Access Help Desk

Have your pharmacy’s 10-digit National Provider Identifier (NPI) number and the appropriate cardholder ID number ready to expedite your call.

P-2.1.4. Eligibility Verification Portal

Telephone

888-701-1713 - Conduent Technical Support and Interfaces Desk

Monday to Friday, 8:00 a.m. to 5:30 p.m. (central)

Fax

866-780-2185

Website

https://txpcra.pharmacy.services.conduent.com/PBMPortal/login.jsp

Refer to the Eligibility Verification Portal section of this manual to learn more about real-time eligibility verification. Refer to the Eligibility Verification (E1) Transaction section to learn how to use these tools to identify people eligible for Medicaid or CHIP.

P-2.1.5. Third-party Recovery

Telephone

866-389-5594 - Texas Third-party Call Center

Monday-Friday, 8:30 a.m. to 5:15 p.m. (central)

Call center staff will verify requests within three business days and provide pharmacy staff with updates to allow for claim processing.

P-2.1.6. Drug Pricing

For Medicaid fee-for-service pricing inquires contact CMS. VDP no longer uses the maximum-allowable cost (MAC).

Telephone

855-457-5264

Fax

844-860-0236

Pharmacy staff are encouraged to fax a copy of the manufacturer's invoice

Email

info@mslcrps.com

Website

medicaid.gov/medicaid/prescription-drugs/retail-price-survey/

Pharmacy providers should use the NADAC Request for Medicaid Reimbursement Review (PDF) to submit NADAC pricing inquiries. You must complete all fields for proper submission of this form. Do not include any personal health information (PHI) on your submitted form or invoice.

P-2.1.7 Pharmacy Prior Authorization

P-2.1.7.1. Clinical Prior Authorization

Telephone

877-PA-TEXAS (877-728-3927) - Texas Prior Authorization Call Center

Monday to Friday, 7:30 a.m. to 6:30 p.m. (central)

Fax

866-469-8590

P-2.1.7.2. Non-preferred Prior Authorization

Telephone

877-PA-TEXAS (877-728-3927) - Texas Prior Authorization Call Center

Monday to Friday, 7:30 a.m. to 6:30 p.m. (central)

Fax

866-469-8590

Website

paxpress.txpa.hidinc.com

Select the "PA Request" tab at PAXpress, the Texas Prior Authorization Call Center Portal.

P-2.1.7.3. Program Review

Mailing Address

Attention: DUR/Formulary Management

Vendor Drug Program (MC-2250)

Texas Health and Human Services

701 W. 51st St., Austin, TX 78751

Fax

512-491-1962

P-2.1.7.5. Technical Helpdesk

Telephone

334-321-0177 - Texas Prior Authorization Technical Helpdesk

Monday to Friday, 7:30 a.m. to 6:30 p.m. (central)

Users call when Texas Prior Authorization portal or other resources are offline or unavailable

P-2.1.8. Pharmacy Payment File Portal

Telephone

888-701-1713 - Conduent Technical Support and Interfaces Desk

Monday-Friday, 8:00 a.m. to 5:30 p.m. (central)

Fax

866-780-2185

Website

moveit.services.conduent.com

Refer to the Payment File Portal section to learn more about the features of the portal.

P-2.1.9. Pharmacy Refunds

Mailing Address

Accounts Receivable Tracking System (BH-1470)

Texas Health and Human Services

Attention: VDP Refunds

701 W. 51st St., Austin, Texas 78751

Physical Address

Accounts Receivable Tracking System (BH-1470)

Texas Health and Human Services

Attention: VDP Refunds

P. O. Box 149055, Austin, Texas 78714

P-2.1.10. Fraud, Waste and Abuse Reporting

Mailing Address

HHSC Inspector General

Texas Health and Human Services

P.O. Box 85200, Austin, TX 78708-5200

Physical Address

HHSC Inspector General

Texas Health and Human Services

11501 Burnet Road, Building 902, Austin, TX 78758

Telephone

800-436-6184 - IG Integrity Line

Website

oig.hhsc.texas.gov

P-2.2. Managed Care

P-2.2.2.1. MCO Pharmacy Participation

Pharmacy providers should refer to the Pharmacy MCO Enrollment Chart for inquiries about a new, pending, or existing contract with each MCO and pharmacy benefits manager (PBM).

P-2.2.2.2. MCO Client Eligibility

Pharmacy staff can use one of the two VDP eligibility tools to verify the client’s enrollment in managed care. This includes the following:

Pharmacy staff can also contact the TMHP Provider Line to find enrollment status and the name of the MCO for clients enrolled in Medicaid or CHIP. Upon confirmation, pharmacy staff should contact the MCO.

Refer to the Pharmacy MCO Assistance Chart for contact information and claims routing information including BIN, PCN, and Group ID for each MCO.

P-2.2.2.3. MCO Pharmacy Claim Processing

Refer to the Pharmacy MCO Assistance Chart for contact information and claims routing information for each MCO and PBM.

P-2.2.2.5. MCO Pharmacy Prior Authorization

Refer to the Pharmacy MCO Assistance Chart for the prior authorization call center phone numbers for each MCO.

Refer to the links to each MCO's clinical prior authorizations on the VDP website MCO Resources page (www.txvendordrug.com/resources/managed-care/mco-resources).

Refer to the Pharmacy Clinical Prior Authorization Assistance Chart for a list of the clinical prior authorizations each MCO uses and how those authorizations relate to those used for processing fee-for-service Medicaid claims.

P-2.2.2.6. MCO Pharmacy Payment

Refer to the Pharmacy MCO Assistance Chart for contact information and claims routing information for each MCO and PBM.

P-2.3. Children with Special Health Care Needs Services Program

P-2.3.2. CSHCN Services Program - Claim Processing

Telephone

800-435-4165 - Pharmacy Benefits Access Help Desk

Monday-Friday, 8:30 a.m. to 5:15 p.m. (central)

This number is only for pharmacy providers. Have your pharmacy’s 10-digit National Provider Identifier (NPI) number and the appropriate cardholder ID number ready to expedite your call.

P-2.3.4. CSHCN Services Program - Prior Authorization

Mailing Address

CSHCN Services Program, MC 1938

Attention: CSHCN Prior Authorization

P.O. Box 149347, Austin, TX 78714-9347

For prior authorization appeals:
Attention: CSHCN PA Administrative Review

Fax

512-776-7565

Providers must send letters of medical necessity on office letterhead.

P-2.4. Kidney Health Care Program

P-2.4.1. KHC Program

Mailing Address

KHC Program (MC 1938)

Texas Health and Human Services

P.O. Box 149347, Austin, TX 78714-9347

Telephone

800-222-3986

512-776-7150 (Austin)

Fax

512-776-7162

Website

hhs.texas.gov/services/health/kidney-health-care

P-2.4.3. KHC Program - Claim Processing

Telephone

800-435-4165 - Pharmacy Benefits Access Help Desk

Monday-Friday, 8:30 a.m. to 5:15 p.m. (central)

This number is only for pharmacy providers. Have your pharmacy’s 10-digit National Provider Identifier (NPI) number and the appropriate cardholder ID number ready to expedite your call.

P-2.5. Texas Drug Utilization Review Board

Mailing Address

Texas Drug Utilization Review Board (MC-2250)

Texas Health and Human Services

701 W. 51st St., Austin, TX 78751

Email

vdp-advisory@hhsc.state.tx.us

This address is only for issues pertaining to the Texas DUR board.  Messages received off-cycle or unrelated to the business of the board are not accepted.

2.5.1. DUR Board

Mailing Address

Attention: Drug Utilization Review Board

Vendor Drug Program (MC-2250)

Texas Health and Human Services

701 W. 51st St., Austin, TX 78751

Email

vdp-advisory@hhsc.state.tx.us

P-2.6. Medicare

P-2.6.2. Facilitated Enrollment

Website

medifacd.mckesson.com/e1/

The Medicare Eligibility Verification Transaction allows pharmacies to submit necessary demographic information on a beneficiary to receive the required information for proper billing to the person’s Part D Plan.

P-2.7. Texas Health and Human Services

P-2.8. Texas Medicaid and Healthcare Partnership

P-2.8.1. TMHP Contact Center Correspondence

Telephone

800-925-9126

Monday-Friday, 7:00 a.m. to 7:00 p.m. (central)

Select Option 2 (Provider Inquiries), then Option 1 (Client Eligibility), and then follow the prompts to find enrollment status and the name of the person's MCO.

Email

provider.relations@tmhp.com

P-2.8.2. TMHP Client Line Correspondence

Telephone

800-335-8957

Monday-Friday, 7:00 a.m. to 7:00 p.m. (central)

P-2.8.3. TMHP Resources

3. Enrollment

P-3.1. Participation

A pharmacy with a current license or registration with the Texas State Board of Pharmacy (TSBP) or is licensed under the laws of another state and is free from any pharmacy board restriction may apply to become a Texas Medicaid pharmacy provider. As defined and limited by federal and state laws, prescribing providers authorized and licensed to practice the healing arts and choose to provide pharmaceuticals may also apply to become pharmacy providers. HHSC maintains open enrollment for in-state pharmacies licensed as Class A or C by the TSBP. Pharmacies holding any other class of pharmacy license may be subject to special application procedures.

Providers who prescribe to clients enrolled in Medicaid fee-for-service, the CSHCN Services Program, Healthy Texas Women Program, and KHC Program enroll through TMHP. Federal law requires HHSC to deny fee-for-service claims for drugs or products prescribed by non-enrolled providers. Providers enroll through the TMHP Provider Enrollment and Management System (PEMS).

Refer to 1 TAC Section 354.1801 (Requirements for Participation) on the VDP website Rules and Statutes page (txvendordrug.com/about/rules).

P-3.2. Programs

Enrollment with HHSC as a Medicaid provider is a prerequisite for participation in other state programs administered by VDP:

  • Children's Health Insurance Program (CHIP)
  • Children with Special Health Care Needs (CSHCN) Services Program
  • Healthy Texas Women (HTW) Program
  • Kidney Health Care (KHC) Program

Enrollment with HHSC is also a prerequisite for participation in any Medicaid or CHIP managed care pharmacy network.

Pharmacy staff should contact the MCO for participation instructions. MCOs must allow any Medicaid-enrolled pharmacy provider willing to accept the terms and conditions of the MCO or pharmacy benefits manager PBM contract to enroll in the network. Refer to the MCO Pharmacy Participation section for contact information.

P-3.3. Enrollment Process

P-3.3.1. Provider Enrollment and Management System

Pharmacy providers enroll, re-enroll, and revalidate with HHSC through the TMHP Provider Enrollment and Management System (PEMS) as of April 1, 2021.

TMHP provides PEMS computer-based training modules on the TMHP Learning Management System (LMS). An LMS account, including a username and password, is required to access training courses. Instructions on creating an LMS account are available on the TMHP LMS Account Login web page. Refer to the TMHP Online Resources section for more information.

P-3.3.2. Enrollment Fee

All pharmacy providers pay an application fee to HHSC to offset the cost of the required background checks.

The fee for applications submitted between January 1 and December 31, 2021, is $599.00.

P-3.3.3. Supplemental Forms

Refer to the Enrollment Forms section for links to the following supplemental forms used during the enrollment process:

  • Application for Texas Identification Number (CPA Form AP-152)
  • Direct Deposit Authorization (CPA Form 74-176)
  • Principal Information for Individuals (Appendix B)
  • Ownership Transfer Affidavit (HHS Form 1332)
    • Required only when pharmacy providers use form 1340 to request a change in ownership. Pharmacy providers must submit the form at least 15 days before the effective date.

Refer to the Eligibility Forms section for links to the following form:

  • Pharmacy Eligibility Verification Portal Access Form (HHS Form 1317)

Refer to the Payment Forms section for HHS Form 1316.

  • Pharmacy Electronic Remittance Advice Agreement (HHS Form 1316)

P-3.3.4. Supporting Documentation

Other supporting documents may be required depending on the pharmacy's business organization.  The TMHP PEMS enrollment process will alert applicants to which supporting documentation is required.

P-3.3.5. Enrollment Completion

Pharmacy staff must submit all required enrollment information to determine if the pharmacy meets the requirements for participation. The enrollment process typically takes 60 business days after receiving all information necessary to process the application. Requests for exceptions to the enrollment process, risk category (according to the MCS Medicaid Provider Enrollment Compendium), and provider types requiring additional state approval may extend the length of the application process.

TMHP will send the applying provider an email to confirm enrollment and send a complete Pharmacy Enrollment Agreement, the document outlining the terms and conditions agreed to in the application process. The date a pharmacy receives this email constitutes the effective date of its enrollment. Enrollment is not retroactive, transferable, or assignable.

The Master Provider File is the list of all providers approved to provide Medicaid services and is maintained by TMHP. A pharmacy should allow up to 2 weeks to appear on the Master Provider File after being notified by TMHP of successful enrollment. Once HHSC includes a pharmacy on the Master Provider File, it is eligible to contract with MCOs.

P-3.4. Delivery Incentive

P-3.4.1. Fee-for-service

Pharmacy providers offering no-cost delivery services to Medicaid fee-for-service clients are eligible for the delivery incentive. HHSC will pay a delivery incentive in the amount published in the Medicaid State Plan (hhs.texas.gov/services/health/medicaid-chip/about-medicaid-chip/state-plan) for each prescription paid by HHSC.

The pharmacy provider must meet the following conditions for payment of the delivery incentive:

  • Advertise to eligible people the availability of the no-charge prescription service
  • Display the HHSC-approved delivery sign in a prominent place in the store (e.g., window, door)
  • Deliver to the Medicaid clients in the same manner and degree as to the public.

HHSC does not pay a delivery incentive for the following:

  • Over-the-counter drugs, including those prescribed as a VDP benefit
  • Claims for clients residing in a nursing home or other similar group facility
  • Claims for vitamin and mineral products or home health supplies

Refer to the Provider Payment Calculation section to learn how HHSC applies the delivery incentive during the reimbursement calculation.

Pharmacy providers approved for delivery must display the HHSC-approved Pharmacy Delivery Sign in a prominent place within the store. The sign measures 8.5 inches by 5.5 inches, is written in English and Spanish and displays the HHSC logo.

P-3.4.1. Managed care

MCOs pay pharmacies to deliver pharmaceuticals. Each MCO develops its participating pharmacy network for this delivery service. Pharmacy staff interested in receiving payment for the delivery of prescriptions to managed care members should contact the MCO to request information on applying.

Refer to the MCO Pharmacy Participation section for contact information.

P-3.5. Operations

P-3.5.1. Software Vendor

The pharmacy's software vendor must support the current National Council for Prescription Drug Program (NCPDP) telecommunication standard, including the "Additional Message Information" field (526-FQ) in the B1 response.

P-3.5.2. Maintaining Enrollment

Enrolled pharmacy providers must notify HHSC through PEMS of any change to the information provided in their application Per the pharmacy enrollment agreement (Part 3, Subpart F). This includes the following information:

  • Pharmacy type
  • Billing and physical addresses
  • Phone and fax numbers
  • Key personnel (i.e., owners, control interests, pharmacists)
  • Financial information, including direct deposit
  • Store closure

Refer to your pharmacy enrollment agreement for all requirements of enrollment information updating processes.

In a change of ownership or control, an owner must notify HHSC at least 15 business days before the change of ownership or control taking effect. HHSC does not perform retroactive changes of ownership regarding the pharmacy enrollment agreement.

Pharmacies can verify their information on the pharmacy search and should submit corrections through PEMS. If your information is incorrect or incomplete, you run the risk of not receiving correspondence from HHSC. Failure to update enrollment information could result in HHSC placing claims on vendor hold or the termination of your enrollment per the pharmacy enrollment agreement.

P-3.5.3. Pharmacy Revalidation

Enrolled pharmacy providers must revalidate every five years. As part of revalidation, HHSC conducts a full screening appropriate to the providers' risk category according to the CMS Medicaid Provider Enrollment Compendium. The Centers for Medicare & Medicaid Services designates pharmacies as limited risk providers. The screening will include licensure and background checks using various federal and state databases to verify whether providers meet Medicaid enrollment criteria. HHSC will disenroll pharmacy providers not revalidating their enrollment by the designated date.

P-3.5.4. Retention of Records

The pharmacy must retain all records and documents referenced in the pharmacy enrollment agreement (Part 3, Subpart I) for a minimum of five years from the date of service.

If any litigation, audit, review, or dispute resolution begins before the five-year period expires, the pharmacy provider must maintain all records until the reviewer concludes the process.

If any litigation, audit, review, or dispute resolution begins at a time when the pharmacy provider would have otherwise been authorized to destroy the records (e.g., five years and a day after the date of service) and the pharmacy provider still has the records, the pharmacy provider must maintain those records until the reviewer concludes the process. 

For purposes of record retention, the reviewer concludes the process only after HHSC provides written notification permanently resolving the issue.

P-3.5.5. Pharmacy Discount Membership Programs

Some pharmacies offer discount price clubs and other membership discount card programs. These programs typically have offered discount drug prices to all customers and given the discounted drug prices to the cash-paying customers who enrolled in the program and paid a nominal membership fee. The Usual and Customary (UAC) Price regulation does not exclude persons who pay a nominal membership fee from the general public. Therefore, pharmacy discount membership program prices constitute discounts given or advertised to the general public pursuant to 1 TAC Section 355.8544, as well as applicable federal law. See, e.g., U.S. ex rel. Garbe v. Kmart Corp., 824 F.3d 632 (7th Cir. 2016). Pharmacy discount membership program prices must be submitted as the UAC price (as previously indicated in the April 2008 edition of the RxUpdate newsletter formerly published by VDP, refer to the April 2008 newsletter (PDF), unless the price would be greater than the most frequently charged price for the same drug.

Refer to 1 TAC Section 355.8544 (Usual and Customary Prices) on the VDP website Rules and Statutes page (txvendordrug.com/about/rules)

Refer to the Usual and Customary section for the definition of the UAC price.

P-3.5.6. Third-Party Discount Plans

Some pharmacies honor discount prices advertised to cash-paying customers by third-parties. Pharmacies may or may not contract with third-parties to adjudicate and administer these discounts.

Only people whose prescriptions are paid by third party payors, such as health insurers, governmental entities and Texas Medicaid, are excluded from the general public in accordance with the UAC Price regulation (1 TAC Section 355.8544).

The involvement of a third-party in offering, advertising, adjudicating, or administering the discount price a person pays does not remove the person from the general public, and the third-party discount price must be included in the UAC price determination if honored by the pharmacy.

As with pharmacy discount membership programs, the requirement a person pay a nominal fee to enroll in the third-party’s discount program does not remove the person from the general public or otherwise exempt the discount price from the UAC price determination. Some third-party discount plan prices are only offered to segments of the general public, such as discount plans for senior adults, employees/retirees of companies, etc. These discount prices must be included in the UAC price determination if the person would have qualified as a member of the same group or segment of the public, but-for the person’s status as a Texas Medicaid beneficiary.

Refer to the Usual and Customary section for the definition of the UAC price.

P-3.5.7. Termination for Inactivity

HHSC will terminate enrollment for pharmacies without any claim payment within a continuous twelve-month period. If HHSC terminates your enrollment for inactivity, you must reapply with HHSC by submitting a new application through PEMS to be reinstated.

P-3.5.8. High-Volume Fraud Education

Federal law requires all pharmacy providers receiving or making annual Medicaid payments of $5 million or more to educate their employees, contractors, and agents about fraud and false claims laws and the whistleblower protections available under those laws.

P-3.6. Comprehensive Care Program Enrollment

The Medicaid Comprehensive Care Program (CCP) can cover medically necessary drugs and supplies not available through VDP for clients from birth through 20 years of age. Pharmacies not enrolled with CCP should direct the client to call TMHP to locate a CCP provider. CCP providers submit claims to TMHP for medically necessary drugs, equipment, or supplies not covered by VDP, including over-the-counter drugs, nutritional products, and disposable or expendable medical supplies commonly found in pharmacies.

Pharmacies must complete an application at tmhp.com. Contact the TMHP Contact Center or e-mail TMHP Provider Relations to request assistance from the local TMHP provider relations representative in your area. Refer to the TMHP Contact Center section for contact information.

All CCP services require prior authorization. The Texas Medicaid Provider Procedures Manual (TMPPM) includes prior authorization requirements for services through CCP. Refer to section 2.1.4 of the Children's Services Handbook of the Texas Medicaid Provider Procedures Manual (tmhp.com/resources/provider-manuals/tmppm). Pharmacies submit prior authorizations using CCP Prior Authorization Request Form (TMHP Form F00012). Refer to the Enrollment - Forms section for this and other enrollment forms.

P-3.7. Durable Medical Equipment Provider Enrollment

Durable medical equipment (DME) is equipment or appliances manufactured to withstand repeated use; ordered by a physician for use in a client’s home; and required to correct or ameliorate a client's disability, condition, or illness. DME includes vitamin and mineral products. DME is not typically available as a pharmacy benefit.

Certain supplies and select vitamin and mineral products are a covered pharmacy benefit of the following programs:

  • Medicaid
  • CHIP
  • CSHCN Services Program
  • KHC Program

A pharmacy must enroll as a DME provider to provide the full array of durable medical equipment and supplies. Pharmacies must complete an application at tmhp.com. Contact the TMHP Contact Center or e-mail TMHP Provider Relations to request assistance from the local TMHP provider relations representative in your area. Refer to the TMHP Contact Center section for contact information.

All claims for DME items require a completed Home Health Services (Title XIX) DME/Medical Supplies Physician Order Form (TMHP Form F00030). Refer to the Enrollment - Forms section for this and other enrollment forms.

P-3.8. 340B

The 340B Drug Pricing Program is a federal program overseen by the Health Resources and Services Administration (HRSA) Office of Pharmacy Affairs. The program requires drug manufactures to provide outpatient drugs to certain health care entities at significantly reduced prices so the remaining funds can provide services to more eligible clients and provide more comprehensive services.

Covered entities with pharmacies wanting to participate in the 340B program must do the following:

  • Enroll pharmacies as described in the Enrollment section of this chapter
  • Inform MCOs of their intent to participate as a 340B provider
  • Submit the provider number on NPI; the covered entity will use the number to dispense 340B drugs to HRSA for inclusion in the HRSA's 340B Medicaid Exclusion File

Refer to the 340B Program section for additional information.

4. Managed Care

P-4.1. Managed Care Programs

HHSC contracts with managed care organizations (MCO) and pays each MCO a monthly amount to coordinate health services for people enrolled in Medicaid or Children’s Health Insurance Program (CHIP) MCOs.  A majority of Medicaid and all CHIP prescription drug benefits are delivered through the managed care model. Each MCO contracts directly with pharmacy benefit managers (PBM) to create pharmacy provider networks people can use to fill prescriptions.

There are five Medicaid managed care programs in Texas, including traditional Medicaid: STAR, STAR+PLUS, STAR Health, STAR Kids, and the Medicare-Medicaid plans. The type of Medicaid coverage a person gets depends on where the person lives and what kind of health issues the person has.

  • STAR
    • Medicaid for children, newborns, pregnant women and some families and children. People in STAR get their services through an MCO.
  • STAR+PLUS 
    • Medicaid program for people who have disabilities or are age 65 or older. People in STAR+PLUS get Medicaid basic medical services and long-term services through an MCO.
  • STAR Health 
    • Medicaid program for children who receive coverage through the Texas Department of Family and Protective Services. STAR Health also is for young adults who were previously in foster care.
  • STAR Kids
    • Statewide Medicaid program providing Medicaid benefits to children and adults 20 and younger who have disabilities.
  • STAR+PLUS Medicare-Medicaid Plans
    • ​​​​​​​HHSC and the federal Centers for Medicare and Medicaid Services (CMS) have set up combined Medicare-Medicaid plans for people in those counties who have both Medicare and Medicaid coverage, known as dual eligibles. By having one plan, Medicare and Medicaid benefits work together to better meet the member’s healthcare needs by offering basic health care and long-term services and supports.

P-4.2. Pharmacy Participation

Pharmacy providers must enroll with HHSC before participating in any managed care network. Refer to the Enrollment Process section to learn more.

Each MCO contracts with a pharmacy benefits manager (PBM) to process prescription claims. The PBM contracts with individual pharmacies. The MCO must allow any enrolled pharmacy provider willing to accept the financial terms and conditions of the contract to enroll in the MCO’s network. Each MCO develops its participating pharmacy network for the delivery of services.

P-4.3. Formulary Management

Each MCO is required by state law to adhere to the Medicaid and CHIP formularies and the Medicaid Preferred Drug List.  An MCO cannot establish a drug as non-preferred.

P-4.4. Pharmacy Clinical Prior Authorization

Certain clinical prior authorizations must be performed for people enrolled in Medicaid managed care.  MCOs may implement any other of the approved clinical prior authorizations but no more.  Pharmacy staff should verify with each MCO as to which clinical prior authorization is applicable.  MCOs cannot establish clinical prior authorization on a drug without approval by HHSC, and no prior authorization can be more stringent than what was approved.

Refer to the Prior Authorization chapter for more about clinical prior authorization criteria.

P-4.5. Pharmacy Complaints

A complaint is defined as any dissatisfaction expressed by telephone or in writing by the pharmacy provider. The definition of complaint does not include a misunderstanding or a problem of misinformation resolved promptly by clearing up the misunderstanding or supplying the appropriate information to the provider’s satisfaction.

Pharmacy providers submit pharmacy complaints to the appropriate MCO. Each MCO is required to resolve pharmacy provider complaints within 30 days from the date the complaint is received by the MCO. The MCOs are also required to resolve pharmacy provider complaints received by HHSC and referred to the MCOs no later than the due date requested by HHSC.

Pharmacy providers must exhaust the complaints or grievance process with the MCO before filing a complaint with HHSC. Pharmacy staff should refer to the MCO's website to obtain information regarding complaints and appeals processes and the MCO's procedure manual. If after completing this process pharmacy staff believe they did not receive full due process from the MCO, staff may file a complaint with HHSC.

Refer to the MCO Complaint Process section for contact information.

5. System Requirements

P-5.1. Pharmacy Claims System

The Vendor Drug Program real-time point-of-sale claim system processes outpatient pharmacy claims, verifies state assistance program eligibility, and sends weekly payment file to the Texas Comptroller of Public Accounts to process payment.

  • Outpatient pharmacy claims are processed for fee-for-service Medicaid, the Children with Special Health Care Needs (CSHCN) Services program, the Kidney Health Care (KHC) program, and Healthy Texas Women (HTW) program.
  • The system performs over 100 separate edits, including validation of the submission format; pharmacy, prescriber, and product; identifying prior authorization requirements or other known insurances; and calculating reimbursement.
  • The system responds with information regarding the person’s eligibility, the program’s allowed payable amount, applicable prospective drug utilization review messages, and applicable error codes and messages.  
  • The system allows pharmacy staff to query program eligibility, prescription benefits, and managed care enrollment status when applicable.  Refer to the Eligibility chapter to learn more about real-time eligibility verification.

P-5.1.1. Maintenance

The system undergoes regularly scheduled weekly maintenance between 11 p.m. Saturdays and 1 a.m. Sundays (central time). The system will not accept or process claims during this time.

HHS will announce extended maintenance hours will via the VDP website and email notification service.

P-5.2. Switch Companies

Network switch companies offer a centralized telecommunication link between the pharmacy and VDP.  All arrangements with switching companies should be handled directly by the pharmacy provider. VDP accepts transactions from the following switch companies:

  • Change Healthcare (formerly Emdeon)
  • QS/1 Data Systems
  • Relay

P-5.3. Claim Format

The current telecommunications standard for pharmacy claim transactions is the National Council for Prescription Drug Programs (NCPDP) version D.Ø. Claim transactions submitted in any other version will reject.

Refer to the payer sheets for specific transaction, segment, and field requirements and, for the E1 transaction, detailed messaging returned in the “Additional Message Information” field (526-FQ). Refer to the VDP website Pharmacy Payer Sheets page for more information.

5.3.1. NCPDP Transactions

The transaction codes below are defined according to the standards established by NCPDP.  Ability to use these transaction codes will depend on the pharmacy’s software.  At a minimum all pharmacy software should have the capability to submit original claims (transaction code B1) and reversals (transaction code B2).

Code Name Support Requirements

B1

Billing

Required

B2

Reversal

Required

B3

Re-bill

Not Supported

C1

Controlled Substance Reporting

Not Supported

C2

Controlled Substance Reporting

Reversal

Not Supported

C3

Controlled Substance Reporting

Rebill

Not Supported

D1

Predetermination of Benefits

Not Supported

E1

Eligibility Verification

Supported

N1

Informational Reporting

N1 from pharmacies not supported

N2

Informational Reversal

N2 from pharmacies not supported

N3

Informational Re-bill

Not Supported

P1

Prior Authorization Request and

Billing

Not Supported

P2

Prior Authorization Reversal

Not Supported

P3

Prior Authorization Inquiry

Not Supported

P4

Prior Authorization Request Only

Not Supported

S1

Service Billing

Not Supported

S2

Service Reversal

Not Supported

S3

Service Rebill

Not Supported

5.3.1.1. Claims Billing (B1) Transaction

This transaction captures and processes the claim in real time. On payable claims, the system notifies the pharmacy of the dollar amount allowed under the Medicaid reimbursement formula.  If the claim is not payable, the system returns an NCPDP reject code.  In some cases, a message is included in "Addition Message Information" (field 526-FQ).

B1 transactions submitted to VDP for people enrolled in Medicaid managed care or CHIP will reject with NCPDP code "AF" (“Patient Enrolled Under Managed Care") and identify the name of the MCO the person is enrolled with.  Refer to the Pharmacy MCO Assistance Chart on the VDP website "Downloads" page for the MCO-specific pharmacy claim billing values.

5.3.1.2. Claims Billing Reversal (B2) Transaction

This transaction is used by the pharmacy to cancel a claim previously processed as paid.  The following fields must match on the original paid claim and on the void request for a successful claim reversal:

  • "Service Provider ID" (2Ø1-B1)
  • "Prescription/Service Reference Number" (4Ø2-D2)
  • "Product/Service ID" (4Ø7-D7)
  • "Date of Service" (4Ø1-D1)

5.3.1.3. Eligibility Verification (E1) Transaction

This transaction is used by the pharmacy to determine a person’s program-specific eligibility, prescription benefits, and managed care enrollment status when applicable.  Refer to the Eligibility chapter of this manual for information about the Pharmacy Eligibility Verification Portal, an alternate method of verification.

E1 transactions submitted to VDP for people enrolled in CHIP will reject with NCPDP code "AF" (“Patient Enrolled Under Managed Care") and identify the name of the MCO the person is enrolled with.  Refer to the Pharmacy MCO Assistance Chart on the VDP website "Downloads" page for the MCO-specific pharmacy claim billing values.

5.3.2. NCPDP Transaction Segments

Data in the NCPDP standard is grouped together in segments.  The table below identifies current program segment requirements.

NCPDP Segment B1 B2 E1 Segment Support Requirements

Header

Mandatory

Mandatory

Mandatory

Required for all transactions

Patient

Required Not Used Required

Required for B1 and E1, not used for B2

Insurance

Mandatory

Not Used Mandatory Required for B1 and E1, not used for B2

Claim

Mandatory Mandatory Not Used Required for B1 and B2, not used for E1

Pharmacy Provider

Not Used Not Used Not Used

Not used

Prescriber

Required Not Used Not Used

Required for B1 only

COB/Other Payments

Optional Not Used Not Used

Required for B1 when other payer exists

Worker’s Comp

Not Used Not Used Not Used

Not Used

DUR/PPS

Optional Optional Not Used

Optional

Pricing

Mandatory Not Used Not Used

Required for B1 only

Coupon

Not Used Not Used Not Used

Not Used

Compound

Optional Not Used Not Used

Required for B1 when claim is for a compound

Prior Authorization

Not Used Not Used Not Used

Not Used

Clinical

Not Used Not Used Not Used

Not Used

Additional Documentation

Not Used Not Used Not Used

Not Used

Facility

Not Used Not Used Not Used

Not Used

Narrative Not Used Not Used Not Used Not Used

5.3.3. NCPDP Transaction Segment Data Elements

The system uses program-specific data elements for each transaction as outlined in the table below.  The pharmacy’s software vendor must review the VDP Pharmacy Provider Payer Sheets before setting up the plan in the pharmacy’s computer system.  This will allow the provider access to the required fields.  Please note the descriptions regarding data elements in the table below.  The system will not process claims without all the required data elements for the transaction submitted.  Required fields may or may not be used in the adjudication process for all transactions.

Code Description

M

Designated as MANDATORY in accordance with the NCPDP

Telecommunication Implementation Guide Version D.Ø.  These fields must be sent if the segment is required for the transaction.

R

Designated as REQUIRED for this program.

O

Designated as OPTIONAL in accordance with the NCPDP

Telecommunication Implementation Guide Version D.Ø.  It is necessary to send these fields in noted situations where they are conditional based on data content.

N

Designated as NOT USED in accordance with the NCPDP Telecommunication Implementation Guide Version D.Ø.

***R*** The “***R***” indicates the field is repeating.  

P-5.4.Claim Submission

Pharmacy staff must submit correct information on all prescription claims, including National Provider Identification (NPI) numbers for pharmacy and prescriber, National Drug Code (NDC), drug quantity, and days supply.  Inaccurate information runs the risk of an audit exception and causes erroneous data on reports.  Noncompliant pharmacies may be referred to the HHSC Inspector General (IG).  The table below contains identification numbers and values used for VDP claims processing.

Field Description

NCPDP Processor ID (BIN)

61ØØ84

Processor Control Number (PCN)

  • DRTXPROD: For Medicaid, CSHCN, and HTW (and CHIP*)
  • DRTXPRODKH: For KHC

Group Number

  • MEDICAID
  • CHIP *
  • KHC
  • CSHCN

Cardholder ID

Program-specific Texas Cardholder ID Number

Provider ID

10-digit Pharmacy NPI

Prescriber ID

10-digit Prescriber NPI

Product Code     11-digit NDC

* See transaction-specific notes in NCPDP Transactions section.

5.4.1. Cardholder ID

The number entered in “Cardholder ID” (Field 3Ø2-C2), in combination with "Group ID" (Field 3Ø1-C1), identifies the program to which the claim is submitted for payment. For people eligible for more than one program the adjudication process will refer submitted claims to the appropriate payer based on the following hierarchy:

  1. Medicaid
  2. Kidney Health Care (KHC) program
  3. Children with Special Health Care Needs (CSHCN) Services Program

For example, when a claim for a Medicaid/CSHCN dual-eligible person is submitted using the CSHCN cardholder number, and the claim is payable by Medicaid, the claim will reject with code “41" ("Submit Bill To Other Processor or Primary Payer"). One of the two messages in the table below will be returned.

Message Meaning
Client has Medicaid ID. Resubmit using the using the Medicaid ID# nnnnnnnnn
(ID Number)
This claim needs to be re-submitted using the Medicaid number provided.
Correct and Resubmit using Med #nnnnnnnnn

Additional errors on the claim must be corrected prior to Medicaid resubmission.  These errors are considered correctable and “non-fatal” and apply to the referred program (in this example, Medicaid) and not to the submitted program (in this case, CSHCN).

5.4.2. Prescriber Provider Identifier

Claims for the payment of items and services ordered, referred or prescribed must be enrolled as a participating provider and contain the National Provider Identifier (NPI) of the physician or other professional who ordered, referred or prescribed the items or services will be denied. These requirements only impact programs for traditional Medicaid, CSHCN Services Program, and HTW Program. Out-of-network providers ordering, referring, or prescribing only for people enrolled in managed care are not subject to these requirements.  

Pharmacies cannot substitute a missing prescriber NPI with the facility NPI or NPI of another provider who did not directly treat the person. This includes claims processed for a 72-hour emergency supply.

Field Name Field Number Values Usage

Prescriber ID

411-DB

10 - digit Prescriber NPI

R

Prescriber ID Qualifier

466-EZ

Ø1 - National Provider Identifier

R

Prescriber Last Name 427-DR Last Name O

Prescribing physicians do not enroll with the VDP but demographic data about each prescriber is received from various state licensing agencies and loaded into the system for use in the claim adjudication process. The most current information loaded into the system is accessible through the Prescriber Search.  Pharmacy claims submitted to VDP without a valid NPI will reject. If the NPI is not on file with VDP then the prescriber's NPI can be found by accessing the Nation Plan & Provider Enumeration System (NPPES) NPI Registry. 

5.4.3. Coordination of Benefits

The system receives daily pharmacy/drug insurance eligibility and insurer information verified by the Texas Medicaid third-party recovery vendor. The system then checks each pharmacy claim at point of sale for other insurance.

Field Name Field Number Usage

Coordination of Benefits/Other Payments Count

337-4C Required.
Other Payer Coverage Type 338-5C Required.

Other Payer ID Qualifier

339-6C

Required if the Other Payer ID is submitted.
Other Payer ID 34Ø-7C Required if the Other Payer ID Qualifier is submitted.
Other Payer Date 443-E8 Required.
Other Payer Amount Paid Count 341-HB Required when submitting payment from Other Payer.
Other Payer Amount Paid Qualifier 342-HC Required when submitting Other Payer Amount Paid Count.
Other Payer Amount Paid  431-DV Required when submitting Other Payer Amount Paid Qualifier.
Other Payer Reject Count  471-5E Required when not submitting Other Payer payment.
Other Payer Reject Code 472-6E Required when submitting Other Payer Reject Count.
Benefit Stage Count 392-MU Required when submitting Benefit Stage Qualifier.
Benefit Stage Amount 393-MV Required when submitting Benefit Stage Qualifier

If Medicaid is billed as primary insurer, and other third-party insurance (other than Medicare) exists in the system, then the claim will reject with NCPDP code 41 ("Submit Bill To Other Processor or Primary Payer").  The pharmacy will be provided with the third-party billing information needed for claim submission to the other payer.  The message will be returned in the “Additional Message Information” field (526-FQ) as follows: “Bill Other Payer (Payer ID:x, Policy No: x, Bin:x, PCN:x, Group:x, Cardholder ID:x)”.

Pharmacy staff should contact their software provider if the “Additional Message Information” field is not displayed.

Refer to the Coordination of Benefits chapter for more information on Medicaid, Medicare, and third-party insurances.

5.4.4. Multi-ingredient Compounds

The system accepts multi-ingredient compounds in the compound segment of the B1 transaction.  Only one compound claim is allowed per transmission and cannot be included as part of a multiple claim transaction.  All ingredients of each compound must be submitted, and the system will only reimburse for products on the program-specific formulary.  The order of the ingredients does not matter. 

Pharmacy staff may submit up to 25 ingredients online using the fields below.

Field Name Field Number Usage

Compound Code

4Ø6-D6

Enter "2" (Compound).

Product/Service ID Qualifier

436-E1

Enter “ØØ”

Product/Service ID

4Ø7-D7

Enter "Ø"

Compound Type

996-G1

Required.

Compound Dosage Form Description Code

45Ø-EF

Required.

Compound Dispensing Unit Form Indicator

451-EG

Required.

Compound Ingredient Component Count

447-EC

Required.

Compound Product ID Qualifier

488-RE

Required.

Compound Product ID

489-TE

Required.

Compound Ingredient Quantity

448-ED

Required.

To receive payment for non-covered products pharmacy staff should use the following fields

Field Name Field Number Usage

Submission Clarification Code Count

354-NX

Enter the number of repetitions (1-3) of "Submission Clarification Code"

Submission Clarification

42Ø-DK

Enter "8" (Process Claim for Approved Compound Ingredients)

Notes:

  • Over the counter (OTC) products in compound claims for eligible people residing in a nursing home will be considered for payment only if a payable legend drug is included as part of the claims.
  • Certain drugs are only payable when submitted as part of a multi-ingredient compounds claim.  Refer to the VDP website Formulary Search to find drugs with this limitation, or refer to the "Compound-only Products" section of the Drug Policy chapter.
  • Compound claims submitted with home health supply products will reject.
  • Vitamin/Mineral products as part of a compound claim will not be paid. 
  • Enter the gross amount due of the total compounded product in the "Gross Amount Due" (GAD) field (430-DU).

5.4.5. Medication Synchronization

Medication synchronization establishes processes for early refills to align the filling or refilling of multiple medications for a person with chronic illnesses.  In accordance with the Texas Insurance Code (Chapter 1369, Subchapter J) the person, their prescribing physician, or the dispensing pharmacist may initiate the medication synchronization request.   

4.5.1 Eligible Medications

A drug is eligible for medication synchronization if:

  • It is listed in the Texas Drug Code Index (formulary) for Medicaid, CHIP, KHC or CSHCN Services Program
  • It is used for treatment and management of chronic illnesses
  • It is a formulation or dosage form able to be effectively dispensed in a medication synchronization protocol
  • It must meet all prior authorization criteria applicable to the medication on the date the synchronization request is made, including clinical prior authorizations, non-preferred prior authorizations, and drug utilization review edits
  • It must be within the same Generic Code Number (GCN) class as the previously dispensed prescription (the GCN class includes NDCs form different manufacturers with the same drug strength and formulation)  

4.5.2 Medication Exceptions

A drug is not eligible for medication synchronization if it is one of the following:

  • Schedule II controlled substance
  • Schedule III controlled substance containing hydrocodone

4.5.3 Eligibility

Medications eligible for synchronization must be used to treat chronic illnesses.  A chronic illness is defined as an illness or physical condition:

  • Reasonably expected to continue for an uninterrupted period of at least three months, and
  • Controlled, but not cured by medical treatment. This includes drugs used to treat mental health conditions and substance abuse.

4.5.4 Claims

4.5.4.1 VDP Processed

A synchronized claim will count as one of the three prescriptions Medicaid will pay if a person is limited. A fourth claim will reject with NCPDP error code 76 ("Plan limitations exceeded").

Pharmacy staff attest the medication is used to treat a chronic illness by submitting these values:

  • “9Ø1” in the “Prior Authorization Number Submitted” field (462-EV)
  • “Ø8” in the “Prior Authorization Type Code” field (461-EU)

Pharmacy staff may call the Pharmacy Benefits Access Help Desk at 1-800-4354165 for assistance.

4.5.4.2 Medicaid Managed Care and CHIP 

Each MCO has an HHSC-approved process for medication synchronization for people eligible for Medicaid or CHIP.  In CHIP, cost sharing or copayment amounts will be prorated. Dispensing fees will not be prorated. Pharmacy staff should contact each MCO for its medication synchronization requirements. Refer to the Pharmacy MCO Assistance Chart on the VDP website "Downloads" page for the pharmacy call center phone number for each MCO.

5.4.5. Dispensing Fees

Dispensing fees for synchronized refills claims will not be reduced or prorated.

P-5.5. Edits

Following an online claim transmission by a pharmacy, the system will return a response to indicate the outcome of processing.  If the claim passes all edits, the system returns a “paid” response with the allowed amount for the paid claim.  A “rejected” response will be returned when a claim fails one or more edits.  Pharmacy staff should consult with their software provider for a list of NCPDP standard reject codes.

5.1. Timely Filing Limits

While most claims are generally submitted at the time of dispensing, there may be mitigating reasons requiring a claim be submitted after being dispensed.  The pharmacy’s software should allow the transmission of claims with past service dates.

  • The timely filing limit from the date of service is 90 days for all original claims. 

  • The timely filing limit from the date of service is 720 days for all reversals.

  • Transmission of claims using the current date for a past service date is a violation of program policy and could result in an audit exception.

  • The inability of a pharmacy's software to submit past service dates is not an acceptable reason for the submission of paper claims.

Claims exceeding the timely filing limit will reject with NCPDP code "81" (“Claim Too Old”).  Claims for people certified with retroactive Medicaid eligibility will process online for 90 days after the certification date of retroactive eligibility regardless of the date of service.  

P-5.6. E-prescribing

Electronic prescribing (e-prescribing, or eRx) allows a prescriber to electronically send an accurate, error-free, and understandable prescription directly to a pharmacy. It also provides the ability to verify eligibility and formulary data for people, prior to and during the prescribing process, and view medication history for the previous 12-month period. This is enabled with the authorized exchange of data between the payer and the prescriber. Full support of e-prescribing is available for Medicaid fee-for-service, CSHCN, KHC, and HTW claims (via SureScripts) and for Medicaid managed care pharmacy claims.

5.6.1. Brand Medically Necessary

If an e-prescription is received by a pharmacy with “dispense as written” (DAW) indicated but without the free text message ("Brand Medically Necessary") or additional note, pharmacy staff must contact the prescriber for a new prescription. Once the pharmacy receives the e-prescription with both data elements, the prescription may be transmitted with the values in the table below.

Field Name Field Number Usage
Dispense as Written 4Ø8-D8 Enter "1" (Substitution Not Allowed by Prescriber)
Prescription Origin Code 419-DJ Enter "3" (Electronic)

Failure of the pharmacy to produce electronic records indicating the proper DAW and “Brand Medically Necessary” in the free text message for the prescription will result in the claim subject to recoupment. All non-electronic “Brand Medically Prescriptions” (for controlled and non-controlled substances), must continue to comply with current policy and Texas State Board of Pharmacy rules.

6. Eligibility

6.1. Identification Numbers

6.1.1. Medicaid

6.1.1.1. Fee-for-Service 

Fee-for-service, or traditional, Medicaid is for people who cannot be in managed care. Pharmacy claims must be submitted with the values identified in the table below. Refer to the VDP website "Pharmacy Payer Sheets" page to review specific transaction, segment, and field requirements on the Claim Billing Transaction (B1) payer sheet.

Field Name Field Number Submitted Value

BIN Number

101-A1

61ØØ84

Processor Control Number

1Ø4-A4

DRTXPROD

Group ID 301-C1 MEDICAID

Pharmacy claims for newborns who have not had a Medicaid ID number assigned should not be submitted with the Mother’s ID number. These claims may be submitted on the Pharmacy Claims Billing Request. Refer to the "Pharmacy Claims Billing Request" section in the System Requirements section.

6.1.1.2. Managed Care

The type of Medicaid coverage a person receives depends on where the person lives and what kind of health issues the person has.

  • STAR is Medicaid for children, newborns, pregnant women and some families and children. People in STAR get their services through health plans, also called managed care plans.
  • STAR+PLUS is a Medicaid program for people who have disabilities or are age 65 or older. People in STAR+PLUS get Medicaid basic medical services and long-term services through a health plan, also called a managed care plan.
  • STAR Health is a statewide, comprehensive healthcare system that was designed to better coordinate and improve access to health care for:
    • Children in Department of Family and Protective Services (DFPS) conservatorship (under age 18).
    • Young adults in CPS extended foster care (ages 18 through 20)
    • Young adults who were previously under DFPS conservatorship and have returned to foster care through voluntary foster care agreements (ages 18 through 20.)
    • Young adults eligible for Medicaid for Former Foster Care Children (FFCC) will continue coverage through the STAR Medicaid Managed Care plan of their choice from age 21 through the month of their 26th birthday.

Pharmacy providers should refer to the managed care organization's provider manual and policy materials. Refer to the Managed Care section for more information on contacting MCOs in your area.

6.1.1.3. Medicaid Copayment Information

There are no prescription drug co-payments for Medicaid-eligible clients.

6.1.1.4. Temporary Medicaid Eligibility Verification

Medicaid-eligible people may present the Medicaid Eligibility Verification (HHSC Form 1027-A) as evidence of Medicaid eligibility.  While the form does not have a Medicaid ID number, it is an official state eligibility document that can be relied upon as proof of Medicaid eligibility until the person and/or family receives the Your Texas Benefits Card.  Medicaid numbers should be assigned within one month of the original presentation.  Pharmacy staff are encouraged to verify the drug is on the formulary, fill the prescription, and then submit the claim to Medicaid once the cardholder ID number is assigned.

6.1.1.5. Medicaid Presumptive Eligibility

Medicaid Presumptive Eligibility (PE) is a process that allows qualified hospitals (QH) and other qualified entities (QE) to determine if a Medicaid-eligible person can get short-term Medicaid. The Affordable Care Act (ACA) requires states to allow QH/QE groups that have gone through the qualification process to make PE determinations consistent with HHSC policies and procedures.

QH/QE staff will provide the person with the Short-term Medicaid Notice (HHSC Form H1266) if the person is determined to be presumptively eligible.  Pharmacy staff may be presented with Form H1266.  This form is not a substitute for the Medicaid Eligibility Verification (Form 1027-A) or the Your Texas Benefits Medicaid card.  In order for a person to receive pharmacy benefits after receiving a Form H1266, the person should:

  • Request a Medicaid Eligibility Verification (Form 1027-A) at an HHSC benefits office, or
  • Print a Medicaid card at YourTexasBenefits.com.

To learn more about presumptive eligibility please visit TexasPresumptiveEligibility.com.

6.1.2. Children’s Health Insurance Program Eligibility

Pharmacy claims for CHIP-eligible client are processed through the person’s MCO. In addition, there is a copayment amount required for the majority of CHIP-eligible clients. Pharmacy providers should refer to the managed care organization's provider manual and policy materials. Refer to the Managed Care section for more information on contacting MCOs in your area.

B1 transactions for CHIP submitted to VDP will reject but include a message that includes the name of the person’s MCO. E1 transactions for CHIP submitted to VDP will return only the name of the MCO. Refer to the System Requirements section for more information about the eligibility verification transaction.

6.1.3. Children with Special Health Care Needs Services Program Eligibility

6.1.3.2. CSHCN Identification Form

Each person is assigned a unique six-digit program ID.  These program ID numbers are generated sequentially by the program eligibility system, and appear on the eligibility forms that eligible people should take to the pharmacy.  Pharmacy staff should convert the six-digit number to a nine-digit number to submit the claim online.

To convert for claim submission, add the number “9” to the beginning of the core six-digit program ID number, followed by “ØØ” after the core program ID number, as shown in the below table. Failure to correct the cardholder ID prior to transmission will result in NCPDPD error code 52 (“Non-matched Cardholder ID”). 

Assigned Program ID Submitted Cardholder ID
123456 9123456ØØ

6.1.3.3. CSHCN Pharmacy Claims Submission

Pharmacy claims must be submitted with the values identified in the table below.  Refer to the “NCPDP B1 Transaction Billing Request” payer sheet for specific transaction, segment, and field requirements.  Refer to the VDP website "Pharmacy Payer Sheets" page for more information.

Field Name Field Number Submitted Value

BIN Number

101-A1

61ØØ84

Processor Control Number

1Ø4-A4

DRTXPROD

Group ID 301-C1 CSHCN

6.1.3.4. CSHCN Copayment Information

There are no prescription drug copayments for CSHCN-eligible clients.

6.1.4. Kidney Health Care Program Eligibility

6.1.4.1. KHC Identification Card

KHC does not issue eligibility cards. People enrolled in KHC will receive an explanation of benefits (EOB) that indicates if they are eligible for the drug benefit, but updated EOBs are not issued on a regular basis or when drug benefits change. Pharmacy staff may contact the KHC program or the VDP Pharmacy Benefits Access Help Desk to verify eligibility. Refer to the Contact Information section for contact information, or below to learn about real-time eligibility verification methods.

6.1.4.2. KHC Pharmacy Claims Submission

Pharmacy claims must be submitted with the values identified in the table below.  Refer to the “NCPDP B1 Transaction Billing Request” payer sheet for specific transaction, segment, and field requirements.  Refer to the VDP website "Pharmacy Payer Sheets" page for more information.

Field Name Field Number Submitted Value

BIN Number

101-A1

61ØØ84

Processor Control Number

1Ø4-A4

DRTXPRODKH

Group ID 301-C1 KHC

6.1.4.3. KHC Copayment Information

Pharmacy staff should contact the KHC Program for copayment information. The copay amount due is returned in the "Patient Pay Amount" field (505-F5) of the pharmacy paid claim response. Refer to the Pharmacy Provider Payer Sheets for information about values and field returned on the paid and rejected response transactions.

Pharmacy staff can perform an Eligibility Verification (E1) transaction to find the person’s copayment amount. Refer to the System Requirements section for information about claim transactions. Refer to the "Field Responses for an Accepted Eligibility Verification" in the NCPDP E1 Transaction Accepted Response payer sheet for further explanation about the response.

6.1.5. STAR Health Eligibility

STAR Health is a statewide, comprehensive healthcare system designed to better coordinate and improve access to health care for:

  • Children in Department of Family and Protective Services (DFPS) conservatorship (under age 18).
  • Young adults in CPS extended foster care (ages 18 through 20)
  • Young adults who were previously under DFPS conservatorship and have returned to foster care through voluntary foster care agreements (ages 18 through 20.)
  • Young adults eligible for Medicaid for Former Foster Care Children (FFCC) will continue coverage through the STAR Medicaid Managed Care plan of their choice from age 21 through the month of their 26th birthday.

STAR Health provides a full-range of Medicaid covered medical and behavioral health services for children in DFPS conservatorship and young adults in DFPS paid placements.  Children taken into state conservatorship will be issued one or more of the following forms:

  • Medicaid Eligibility Verification (HHSC Form 1027-A)
  • Designation of Medical Consenter for non-DFPS Employee (DFPS Form 2085-B)

These forms will include either a Medicaid ID number or the 16-digit DFPS number. Pharmacy staff are allowed to submit prescription claims with the DFPS number immediately, without having to wait for a Medicaid ID to be assigned. After the person receives a Medicaid number, pharmacy staff must submit subsequent claims using the Medicaid ID and not the DFPS number.

6.1.5.1. STAR Health Pharmacy Claims Submission

Pharmacy claims using the DFPS number must be submitted with the values identified in the table below.  Refer to the “NCPDP B1 Transaction Billing Request” payer sheet for specific transaction, segment, and field requirements.  Refer to the VDP website "Pharmacy Payer Sheets" page for more information.

Field Name Field Number Submitted Value

BIN Number

101-A1

61ØØ84

Processor Control Number

1Ø4-A4

DRTXPROD

Group ID

301-C1

MEDICAID

Cardholder ID

302-C2

16-digit DFPS number

Prior Authorization Type Code

461-EU

8

Prior Authorization Number Submitted

462-EV

1Ø27

6.1.6. Healthy Texas Women Program Eligibility

1.6.1 HTW Pharmacy Claims Submission

The pharmacy must submit claims with the values identified in the table below.  Refer to the "NCPDP B1 Transaction Billing Request" payer sheet for the specific transaction, segment, and field requirements. Refer to the VDP website "Pharmacy Payer Sheets" page for more information.

Field Name Field Number Submitted Value

BIN Number

101-A1

61ØØ84

Processor Control Number

1Ø4-A4

DRTXPROD

Group ID      301-C1 MEDICAID

6.2. Pharmacy Verification of Eligibility

Pharmacy staff have various sources and methods that may be utilized to verify a person’s enrollment status, pharmacy benefits, participation in managed care, and Medicare coverage. Pharmacy staff should verify eligibility with the same processor that will be used to eventually process the claim.

6.2.1 Real-time Verification

Pharmacy staff using the following real-time eligibility tools will query the VDP Pharmacy Claims System using the person’s Medicaid, CHIP, KHC, or CSHCN cardholder ID number.  The expanded messaging that is returned will include the most current or last effective eligibility period, prescription limitations, MCO name, and  Medicare Part B and D coverage.

6.2.1.1 Eligibility Verification (E1) Transaction

The National Council for Prescription Drug Programs (NCPDP) Eligibility Verification transaction is submitted from the pharmacy’s point-of-sale claim system. Pharmacy providers should contact their software company to discuss E1 submission issues and to ensure the “Additional Message Information” field (526-FQ) is returned for all responses.

Refer to the System Requirements section to learn more about the NCPDP standards for pharmacy claim transactions. Refer to the VDP website "Pharmacy Payer Sheets" page to review the list of the expanded messages on the Eligibility Verification Transaction (E1) payer sheet.

6.2.1.2 VDP Eligibility Verification Portal

The Pharmacy Eligibility Verification Portal (EVP) (txpcra.pharmacy.services.conduent.com/PBMPortal/login.jsp) is a browser-based application used to obtain a person’s enrollment status, pharmacy benefits, and managed care participation. All Medicaid-enrolled pharmacy providers are eligible to create a free account. The EVP is accessible only through the Microsoft® Internet Explorer® browser.

Refer to the Forms section for the form and submission instructions.

Refer to the Contact Information section for EVP Correspondence.

6.2.2 Your Texas Benefits Medicaid Card

People eligible for Medicaid should present the Your Texas Benefits Medicaid ID card to obtain Medicaid services when visiting a doctor or dentist office, a clinic, or pharmacy. The card is plastic, like a credit card. New cards are not sent to Medicaid-eligible people each month, and people should keep using the card even if he or she changes MCO.

While prescribing providers may verify eligibility and view available health information at the provider portal, pharmacy staff should use one of the VDP real-time eligibility verification tools to obtain outpatient pharmacy eligibility and prescription benefit information.

Pharmacy staff may call the Your Texas Benefits Provider Help Desk to find enrollment status and the name of the person’s MCO. Refer to the “Your Texas Benefits” section of the Contact Information section for about the YourTexasBenefitsCard.com provider portal and help desk.

7. Coordination of Benefits

7.1. Medicaid

It is common for people eligible for Medicaid to have one or more additional sources of coverage for health care services.  Third Party Liability (TPL) refers to the legal obligation of third parties to pay part or all of the expenditures for medical assistance. By law, all other available third party resources must meet their legal obligation to pay claims before Medicaid pays for the care of a person eligible for Medicaid. 

7.1.1. Medicaid With Other Insurance

Pharmacy providers must bill all other third party payers when a person has coverage through another payer for prescription drugs, including non-prescription (over the counter) medications, some products used in symptomatic relief of cough and colds, and some prescription vitamins and mineral products. Refer to Section 1.2.2 below for more information regarding Medicaid coverage of wrap-around drugs for people who are dual eligible.

If other insurance exists in the VDP Pharmacy Claims System and Medicaid is billed as the primary insurer, then the claim will reject with NCPDP code 41 (“Submit Bill To Other Processor or Primary Payer”). The pharmacy will be provided with the third-party billing information needed for claims submission to the other payer. Refer to the System Requirements section for more information about COB program requirements.

If the pharmacy submits the claim to the primary payer and it is not paid, pharmacy staff should contact the primary payer and/or prescriber to address the rejection reason. If the claim is not payable by the other payer, Medicaid may pay the claim depending on the rejection reason (including expired coverage). Pharmacy staff should submit the claim to Medicaid and include the other payer’s rejection code in the “Other Payer Reject Code” field (472-6E).

Medicaid will continue to reject the claim until billing to all other known payers has been attempted. If the person is assessed a deductible or co-payment, the pharmacy should submit the claim to Medicaid (as secondary payer) and include the amount paid by the primary payer. The VDP Pharmacy Claims System will pay deductibles and co-payments, up to the amount Medicaid would have reimbursed, for eligible people and covered drugs.

The person should always walk out of the pharmacy with their prescribed medications and no out-of-pocket expense.

7.1.1.1. Texas Pharmacy Third Party Insurance Call Center

The Texas Pharmacy Third Party Insurance Call Center ensures the accuracy of third-party information used in the claims adjudication processes.

Pharmacy staff may contact the Call Center to confirm non-Medicare third party insurances for people eligible for fee-for-service Medicaid or report discrepancies found with other payers.

Pharmacy providers should attempt to bill the third-party payer in question before contacting the Call Center. Call center staff cannot process a request until the pharmacy has received a rejection from the third-party payer. Call center staff will verify insurance within 72 hours and provide updates to the VDP claim processor.

Refer to the “Third-party Recovery” section of the Contact Information section to verify other insurance through the Call Center.

7.1.1.2. Third-party Contact Guidance

What Happens Who to Contact
Pharmacy staff receives a rejection from the primary insurance. The primary insurance. Medicaid does not have the ability to assist with the correction of a non-Medicaid rejection.

Pharmacy staff are told the person does not have any other insurance although Medicaid has other insurance on file.

The Texas Pharmacy Third Party Insurance Call Center at 1-866-389-5594. Staff will re-verify the other insurance within 72 hours and update the claim processing system as necessary.

Pharmacy staff does not know how to enter a coordination of benefits claim. Your software help desk or corporate office.

7.1.2. Medicaid with Medicare

A person deemed dual-eligible has full Medicaid and is eligible for Medicare Part A and/or Part B. People that qualify for Medicare Part A and/or Part B are eligible for Medicare Part D (Medicare drug coverage). 

7.1.2.1. Medicaid with Medicare Part B

Medicare Part B covers medical benefits, such as physician services, outpatient care, durable medical equipment, home health services, some outpatient "Part B" medications, some laboratory tests, and many preventive services.

People eligible for Medicaid who are also covered by Medicare Part B may have all or a portion of their co-insurance and deductible amounts paid by Medicaid.  Test strips, lancets, and needle disposal systems are covered under the Medicare Part B durable medical equipment (DME) benefit, and Medicaid will pay the cost share of covered home health supplies after Medicare Part B provides a paid response.

Pharmacies must follow the coordination of benefits process when billing claims to Medicaid. The pharmacy must submit the claim to Medicare prior to submitting to Medicaid for payment consideration. Medicaid is the payer of last resort.  This includes claims for Part B covered drugs for people with qualified Medicaid beneficiary (QMB) benefits. Medicaid will reimburse up to the maximum payable Medicaid amount.  If the amount paid by Medicare is greater than the maximum payable Medicaid amount, the claim will pay at zero dollars.

If Medicare Part B provides a paid response, the pharmacy should process the Medicaid claim to result in one of the following:

  • The claim is paid with a $0.00 paid amount; Medicaid will cover the cost share (co-insurance, copay, deductible) up to the Medicaid allowed amount.
  • The claim is paid with an amount greater than $0.00, but less than the Medicaid allowed amount for identified drugs covered by Medicaid; Medicaid may cover the cost share portion up to the Medicaid allowed amount.  Pharmacies may not request payment directly from the Medicaid-eligible person.

7.1.2.2. Medicaid with Medicare Part D

Medicare Part D (Medicare Rx) is the Medicare prescription drug benefit, enacted as part of the Medicare Modernization Act of 2003. CMS states that people eligible for Medicare Part A or who are enrolled in Medicare Part B are also eligible for Medicare Part D.

Medicare Part D offers optional drug coverage to all Medicare-eligible people through private prescription drug plans (PDPs) or Medicare Health Maintenance Organizations (HMOs). Prescriptions reimbursable by Medicare Part D are not eligible for additional reimbursement through Medicaid.

Medicaid does not pay for Medicare Part D covered drugs and cannot be billed after payment is collected from Medicare Part D for dual-eligible people. Certain drugs can be excluded from coverage by the PDP. Each plan has their own formulary and the person must choose the plan that is best for their prescription drug needs. Part D sponsors are required to implement reject messaging that will allow pharmacies to identify claims for excluded Part D drugs that can be billed to the state.

Medicaid may choose to pay for some drugs excluded from Medicare Part D coverage. Texas Medicaid will pay for wrap-around drugs/products for dual eligible people after commercial insurance has been billed or if there is no commercial insurance on file. These drugs include non-prescription (over the counter medications), some products used in symptomatic relief of cough and colds, and some prescription vitamins and mineral products.

Medicaid will pay for a limited set of home health supply products. CMS states that medical supplies directly associated with delivering insulin to the body (including syringes and needles) are considered Medicare Part D covered. However, test strips, lancets, and needle disposal systems are not considered medical supplies directly associated with the delivery of insulin for purposes of coverage under Part D. These items should be covered under the Medicare Part B DME benefit, and

Medicaid will pay the cost share for covered home health supply products after

Medicare Part B provides a paid response. If the person does not have Medicare Part B, Medicaid will pay for these items. Refer to the Home Health Supplies section for more information regarding coverage of hone health supply products for people dually enrolled in Medicare and Medicaid.

Claims submitted to Medicaid with a Medicare Part D covered drug and/or product will reject to bill Medicare Part D and/or commercial insurance (if there is commercial insurance on file) if the person is eligible for Medicare Part D. If a pharmacy receives a rejection from Medicaid to bill the person’s PDP, then the pharmacy should submit the claim to the person’s PDP. If the person does not have plan information or says that they are not enrolled in a plan, then pharmacy staff should do one of the following:

  • Call Medicare for PDP information.
  • Utilize the Facilitated Enrollment process (see Section 1.2.2.2 below).
  • Submit the claim to the Medicare Limited Income (LI) NET program if the person has never been enrolled in a Medicare PDP (see Section 1.2.2.3 below).

7.1.2.2.1. Opting out of Medicare Part D

People that are deemed dual-eligible are automatically enrolled in a Medicare PDP.  Some people may choose to disenroll, or opt out, from their PDP, meaning the person has chosen to not participate in the Medicare Part D plan. Medicaid is not liable for the person’s prescription drug coverage if the person opts out of enrolling in a Part D plan.

The VDP pharmacy claims system returns a message on paid claims for people that will soon become eligible for Medicare Part D.  This message will be returned several months prior to the person’s Medicare coverage effective date to alert the pharmacy that Medicare will become liable for prescription drug coverage. The message is returned in the "Additional Message Information" field (526-FQ) and read "Part D liable for this client's Rxs no later than XX/XX/XXXX".

Pharmacy staff should advise the person that Medicaid will no longer pay for prescriptions for Part D covered drugs as of the date returned in the message. The person must choose a Medicare Part D plan by that date in order for their prescription benefits to continue.  After the date returned Medicaid will only be responsible for the Part D-excluded wrap-around drugs.

7.1.2.2.2. Medicare Facilitated Enrollment

Facilitated Enrollment is the process by which low-income subsidy (LIS) people are enrolled in a Part D plan. The point-of-sale facilitated enrollment process ensures that dual-eligible people who are not yet enrolled in a Medicare PDP are still able to obtain prescription drug coverage when evidence of Medicare and Medicaid eligibility is presented at the pharmacy. Pharmacy staff can submit an eligibility verification transaction to Relay Health to identify whether the person is already enrolled in a PDP. Refer to the "Medicare" section of the Contact Information section to learn about this program.

7.1.2.2.3. Limited Income NET Program

The Limited Income Newly Eligible Transition (LI-NET program) provides immediate and temporary Part D prescription drug coverage for low income Medicare people not already in a Medicare PDP. The LINET program covers all Part D covered drugs, and there are no network pharmacy restrictions during the time period covered by this program. Refer to the "Medicare" section of the Contact Information section to learn about this program.

7.1.2.2.4. Extra Help with Medicare Prescription Drug Plan Costs

People with limited incomes may qualify for extra help to pay for their prescription drug costs. The person will be charged the reduced copayment based on the level of Extra Help they receive. The program also covers prescriptions that eligible people may have filled within the last 30 days.

Refer to the "Medicare" section of the Contact Information section to learn about this program.

7.2. CSHCN Services Program

7.2.1. CSHCN With Medicaid

If a person is eligible for Medicaid and the service is covered by Medicaid then Medicaid will pay the claim through either VDP (for drugs) or through the Medicaid Comprehensive Care Program (for items not covered by VDP). Pharmacy providers that want to enroll in the Medicaid Comprehensive Care Program (CCP) should refer to the "Pharmacy Enrollment and Support" section of the Contact Information section.

7.2.2. CSHCN with Other Insurance

People enrolled in the CSHCN Services Program may have coverage for prescription drugs through another primary payer.  Pharmacy providers must bill the primary payer first and bill the CSHCN Services Program as secondary payer.  The program will pay drug co-pays, deductibles, and co-insurances.  The program does not qualify as a CMS-defined State Pharmaceutical Assistance Program (SPAP).

7.2.3. CSCHN with Medicare Part B

CSHCN will pay the Medicare Part B co-insurance for people without supplemental drug coverage.

7.2.4. CSHCN with Medicare Part D

CSHCN will coordinate benefits with Medicare Part D deductibles, co-insurance, and gap coverage.

7.3. KHC Program

7.3.1. KHC with Other Insurance

Pharmacy staff should report any private or group health insurance coverage to the KHC Program at 1-800-222-3986.

7.3.2. KHC with Medicare Part B

KHC will pay the Part B co-insurance for immunosuppressant drugs on the KHC formulary for people without supplemental drug coverage.

7.3.3. KHC with Medicare Part D

People eligible for both KHC and Medicare must apply for a stand-alone Medicare Part D plan.  Medicare Part D will become the primary payer for prescription drugs, and KHC will become the secondary payer for the quantity covered by Medicare, up to a 90 day supply. When KHC is the secondary payer for claims coordinated with Medicare Part D, the person will have a zero copay.  A copay is assessed when KHC is the sole payer for the claims. KHC does not coordinate with Medicare Advantage Plans.

KHC will coordinate benefits with Medicare Part D for deductibles, co-insurance, and gap coverage only for KHC formulary products.  If the drug is a Part D included drug, but not covered by the person’s Part D plan, it will not be covered by KHC.  KHC will cover Medicare Part D wrap-around drugs that are on the KHC formulary. 

KHC will only provide assistance with four (4) prescriptions per month.  KHC will waive day supply limitations for Medicare Part D drugs when paying secondary claims.  KHC may apply a co-payment for coordinated claims.

The KHC program is a State Pharmacy Assistance Program (SPAP), and any payments made by the program for Medicare-allowable drugs will count toward the person’s out-of-pocket expenses.

8. Drug Policy

8.1. Drug Coverage

Texas HHS maintains the Texas Drug Code Index (TDCI), or formulary, for the following programs:

  • Medicaid
  • Children’s Health Insurance Program (CHIP)
  • Children with Special Health Care Needs (CSHCN) Services Program
  • Healthy Texas Women (HTW) Program
  • Kidney Health Care (KHC) Program

We require drug manufacturers to complete the TDCI Certification of Information (COI) to request the addition of drugs and products to the formulary. The COI is for Medicaid formulary only. Manufacturers do not request addition to the CHIP, CSHCN, HTW, or KHC programs.

MCOs must adhere to the Medicaid and CHIP formularies.

Drugs classified with Drug Efficacy Study Implementation (DESI) values "5" or "6" are not covered. 

8.2. Claim Requirements

2.1 Drug Format

Pharmacy claims are submitted with the following fields:

  • 11-digit National Drug Code (NDC) in the "Product/Service ID" field (4Ø7-D7)
  • ‘03’ in the “Product/Service ID Qualifier” field (436-E1)

 The NDC number submitted on the claim transaction must match the NDC number on the package or container  dispensed

The 11-digit NDC number is composed of three segments:

  • Labeler: 5-digit code assigned by the Food and Drug Administration (FDA) and identifies the drug manufacturer
  • Product: 4-digit code assigned by the drug manufacturer and identifies the specific product
  • Package: 2-digit code assigned by the manufacturer and identifies the package size

The correct format for pharmacy claim submission is an 11-digit number in a 5-4-2 format.  Pharmacy staff must convert any other number, such as a 10-digit number in the 4-4-2, 5-3-2, or 5-4-1 format, before submittal.  To correct the NDC place a leading zero (Ø) in either the labeler code, product code, or package size code to conform to the 5-4-2 format.

Refer to the “Multi-ingredient Compounds” section of the System Requirements chapter of this manual for instructions on how to identify the NDC on a multi-ingredient compounds claim.

2.2 Drug Unit of Measure

Pharmacy claims are submitted with billing units in the “Unit of Measure” field (6ØØ-28):

  • Each (EA), used when the product is dispensed in discreet units
  • Gram (GM), used when a product is measured by its weight
  • Milliliter (ML), used when a product is measured by its liquid volume

Pharmacy staff should be aware of the correct billing units on certain medications to alleviate billing discrepancies, which can lead to potential audit risks. Quantity for milliliters and grams must be divisible by package size. Some products (such as Risperdal Consta, Humira, Enbrel, Lovenox, Neupogen, Pegasys, and Procrit) may have varying units depending on the NDC number.

Refer to the NCPDP B1 Transaction Payer Sheet for the acceptable unit of measure values on a single ingredient and multi-ingredient compound claim.

2.3 Day Supply

Pharmacy claims are submitted with the number of consecutive days covered by the prescription in the "Days Supply" field (4Ø5-D5). Incorrect reporting in this field may impact early refill edits or inaccurate drug use review warnings. Pharmacy staff should divide the quantity by total dosage units per day to identify the correct day supply.

Program Maximum Day Supply
Medicaid 185
CHIP Up to 90
CSHCN 185
KHC 34 unless Medicare is the primary payer; KHC will pay for a 90-day supply if Medicare allows a 90-day supply

2.4 Quantity Dispensed

Pharmacy claims are submitted with the amount dispensed by the pharmacy at point-of-sale in the "Quantity Dispensed" field (442-E7). Pharmacy staff must dispense the quantity prescribed or ordered by the prescribing provider except as limited by the policies and procedures described in this manual. When the actual quantity dispensed deviates from the prescribed quantity, pharmacy staff must submit for the amount dispensed.  Incorrect reporting in this field may prompt drug companies to dispute the claim and cause rebate auditors to review the claim level data.

Drugs such as ear drops, eye drops or ointments, inhalers, and injectable products are packaged in sizes without a whole number.  When submitting a claim for a drug packaged in a metric decimal-sized package (e.g. 10.2; 2.5; etc.), pharmacy staff should include the decimals on the claim and not round up.

Contact your software vendor for assistance with issues resolving whole number units on the package size and submitting decimal units. 

2.5 Dispense as Written

Pharmacy staff must submit a value "1" in the "Dispense as Written (DAW) / Product Selection code" field (4Ø8-D8) when a prescribing provider wants a nonpreferred brand name dispensed and hand writes the phrase "Brand Necessary," "Brand Medically Necessary," "Brand Name Necessary," or "Brand Name Medically Necessary" across the face of the prescription.  The value of “1” will reimburse at the normal calculated cost, including comparison to the submitted "Usual and Customary Charge" and "Gross Amount Due" fields.  The value of “1” is not needed if the brand drug prescribed has preferred status on the Texas Medicaid Preferred Drug List.

If an e-prescription is received by a pharmacy with “dispense as written” indicated but without the free text message ("Brand Medically Necessary") or additional note, pharmacy staff must contact the prescriber for a new prescription. Submit the claim once the pharmacy receives the e-prescription with both data elements.

Failure of the pharmacy to produce electronic records indicating the proper DAW and “Brand Medically Necessary” in the free-text message for the prescription will result in the claim subject to recoupment. All non-electronic “Brand Medically Prescriptions” (for controlled and non-controlled substances), must continue to comply with current policy and Texas State Board of Pharmacy (TSBP) rules.

2.6 Prescription Splitting

The same drug in the same strength should be dispensed no more than once per month, per person.  An exception to this is only for medications considered too unstable to be dispensed as a one-month supply.  Pharmacies not compliant with this policy may be referred to the Texas HHS Office of Inspector General.

8.3. Claim Limitations

This section identifies claim limitations for claims processed by Texas HHS (for traditional Medicaid, CSHCN, HTW, and KHC programs) or by the managed care organization.  If no guidance is given for MCO processing, contact the MCO for plan-specific limitations.

3.1 Prescription Limits

3.1.1 Medicaid

People enrolled in Medicaid are limited to three (3) prescriptions per month except for:

  • Children under the age of 21
  • People enrolled in managed care
  • People enrolled in eligibility waiver programs

Drugs and products not counted as part of the three-prescription limit include:

  • Family planning drugs
  • Flu vaccines
  • Opioids for acute pain
  • Diabetic supplies
  • Smoking cessation products
  • Home health supplies
    • Refer to the Home Health Supplies chapter of this manual for more information about these products
  • Mosquito repellents
    • Refer to the Mosquito Repellant chapter of this manual for a list of these products

3.1.1.1 Medicaid  

Payment for up to a six-month supply may be allowed for adults with monthly prescription limitations dependent on the drug prescribed.  Quantities should not exceed a one-month (34-day) supply for people with an unlimited number of prescriptions per month.

3.1.2 CHIP

People enrolled in CHIP have unlimited prescriptions.

3.1.3 CSHCN

People enrolled in the CSHCN Services Program have unlimited prescriptions.  The CSHCN Program is limited by the availability of appropriated funds.  Upon notification to eligible people and providers, services may be adjusted periodically depending upon the current availability of funds. If a person is dually-enrolled in Medicaid and CSHCN, the Medicaid benefit should be used first, including those people limited to 3 prescriptions per month.

3.1.4 KHC 

The KHC program limits people to four (4) prescriptions per month.  The number of prescriptions per month the program pays per person is based on available KHC funds, and the number of prescriptions covered may change depending on budget limitations.  Notification will be sent 30 days in advance if the prescription number limitation changes.

3.2 Refill Limitations

HHSC allows prescription refills based on the DEA drug schedule as outlined in the table below.

DEA Schedule Refill Limitations

No schedule

Original prescription plus 11 refills within 365 days from the written date of the original prescription

Schedule 3, 4, 5 Original prescription plus 5 refills within 185 days from the written date the original prescription

3.3 Refill Authorization

A pharmacy may Refills may only submit refills when requested by the individual. Pharmacy staff must not bill Medicaid unless the person has requested the refill.  This includes pharmacies using automated refill systems.

No partial fill processing is allowed.

3.4 Refill Utilization

A refill is considered too soon, or early, if the person has not used at least 75% of the previous fill of the medication.

3.5.1 Traditional Medicaid & CSHCN

A refill for certain controlled substances, such as tramadol, is considered too soon if the person has not used at least 90% of the previous fill of the medication.  Attention deficit hyperactivity disorder drugs and certain seizure medications are excluded from this requirement.

Refer to the Formulary search, and select the "90% Utilization" filter to identify these drugs.

Claims not meeting the utilization threshold will reject with error code 79.  A previous fill may have been from a different pharmacy.

3.5.2 Refill Too Soon Overrides

3.5.2.1 Vendor Drug Program

Contact the Pharmacy Benefits Access Help Desk to request an override. 

Justifications for an override may include a verifiable dosage increase or anticipated prolonged absences from the state.  Prescribing providers may be asked to verify the reason for the early refill by the pharmacy.

3.5.2.2 Managed care

Contact the MCO for specific requirements and processes related to dispensing early refills.

3.5 Dollar Limits

3.5.1 Vendor Drug Program

Texas HHS limits claims to $9,999.99. Contact the Pharmacy Benefits Access Help Desk for assistance with claims $10,000.00 and greater.

8.4. Formulary Search

The VDP website features a formulary search providing program coverage, prior authorization requirements, and pricing information.  There are two separate searches, one for drugs and one for products, including home health supplies and vitamins and minerals.

HHSC updates the Formulary Search weekly, usually each Monday morning.  Drugs and products removed from the formulary will show a termination date and remain viewable on the search for 90 days.

The data of search is also available for download as a delimited text file.

4.1 Drug Search

Users can input a combination of the following fields to search for drugs:

  • Brand or generic name of the product
  • 11-digit NDC
  • Drug Manufacturer
  • Preferred drug class
  • Filter by a program
    • Medicaid, CHIP, CSHCN, HTW, HTW-Plus, and KHC
  • Filter by drugs requiring non-preferred or clinical prior authorization
  • Filter by type of drug
    • Family planning drugs
    • Drugs requiring 90% use before a refill
    • Over the counter drugs
    • Injectable drugs
    • Drugs identified as long-acting reversible contraception products

4.2 Product Search

Users can input a combination of the following fields to search for products:

  • Brand or generic name of the product
  • 11-digit NDC
  • Drug Manufacturer
  • Home health supply HCPCS code description 
  • Filter by a program
    • Medicaid, CHIP, CSHCN, HTW, and KHC
  • Filter by type of product:
    • COVID-19 vaccines
    • Diabetic supplies
    • Flu vaccines
    • Mosquito repellents

8.5. Epocrates

Epocrates is a publisher of mobile device software applications designed to provide information about drugs to doctors and other health care professionals. The Texas Medicaid formulary and Preferred Drug List are available on the Epocrates drug information system. The service is free and provides instant access to information about the Texas Medicaid formulary through the internet or a handheld device.

Once registered, users can select the “Texas Medicaid” formulary option, allowing searches by drug name to determine which products are preferred, non‐preferred, or subject to clinical prior authorization criteria. Epocrates does not mirror the HHSC designations differentiated by dosage form. In these situations, Epocrates accompanies the designation with an explanatory message.

8.6. Shortages

We encourage pharmacy staff to notify Texas HHS about potential drug shortages impacting prescribing choice and pharmacy claim processing using the Drug Shortage Notification (HHS Form 1315).  The state encourages reporting of significant drug shortages affecting multiple pharmacies and distributors which will have a continuing adverse impact on people enrolled in Medicaid if not resolved promptly. The process ensures notification of alternatives to the shorted drug, the timeline of the shortage, and the drug’s availability for use. 

Requestors should provide as much of the following information on the form, including:

  • Reason for reporting the shortage
  • The extent of shortage, if known
  • Estimated length of issue timeline
  • Product status change
  • Change in status requiring new application or NDC change
  • Alternatives
  • Published notices or resources (such as FDA, American Society of Health System Pharmacists, etc.)

Referrals should recommend an alternative with a supply chain so extra demand will not cause another shortage.

8.7. Drug-specific Requirements

This section identifies certain drug requirements for claims processed by HHSC (for traditional Medicaid, CSHCN, HTW, and KHC programs) or by MCOs. If no guidance is given for MCO processing, then the pharmacy staff should contact the MCO for claim submission requirements.

8.7.1 Anorexic Products

8.7.1.1. HHSC

Traditional Medicaid

HHSC requires prior approval for ages 21 years and over, and will deny weight management diagnoses. Claims will reject with NCPDP error code 75 and include the message “Prior Authorization not on file. Contact Pharmacy Benefits Access” in the “Additional Message Information” field (526-FQ). VDP clinician staff determine coverage, and no form is required.

8.7.2. Anti-Fungal Products

8.7.2.1. HHSC

Traditional Medicaid

HHSC limits people to a 180-day supply per calendar year and will reject claims with error code “76” and the message “Days Supply Limited per Year by Program. Contact Pharmacy Benefits Access” in the “Additional Message Information” field (526-FQ). VDP clinician staff determine coverage, and no form is required.

8.7.3. Biosynthetic Growth Hormone Products

8.7.3.1. HHSC

Traditional Medicaid

Prior approval and documentation of appropriate diagnoses are required. Prior authorization criteria are available online. Refer to the "Pharmacy Prior Authorization" section of the Contact Information chapter of this manual to contact the Texas Prior Authorization Call Center.

CSHCN Services Program

HHSC requires prescribing providers to submit prior authorization documentation of appropriate diagnoses. The prescribing provider must complete one of the following sets of forms:

  • Growth Hormone Products Authorization Request (HHS Form 1312)
  • Texas Standard Prior Authorization Form for Prescription Drug Benefits (Texas Department of Insurance Form TDI NOFR002) and Growth Hormone Agents - Addendum (HHS 1327)

8.7.4. Blood Factor Products

8.7.4.1. HHSC

Traditional Medicaid

Pharmacy staff must submit one compound claim when the drugs are of the same active ingredient, from the same drug manufacturer, and are the same drug formulation, intended for use together with each dose. The multi-ingredient compound claim should contain one line-item per NDC. Refer to the System Requirements chapter of this manual for claim submission requirements for multi-ingredient compounds.

CSHCN Services Program

Products are covered and used in the treatment of hemophilia. Claims are processed and paid by TMHP.

8.7.5. Compound-only

8.7.5.1. HHSC

Some drugs are only payable when submitted as part of a multi-ingredient compound claim.  After searching for a drug using the formulary search, refer to the drug details page and locate the "Compound-only Use by Program" segment.

Not all drugs in a multi-ingredient compound claim are payable. Refer to the System Requirements chapter of this manual for instruction on how to receive payment for non-covered products part of a multi-ingredient compound claim.

8.7.6. Cough and Cold Products 

Cough and cold combination products for children less than 2 years of age are not covered. This excludes single entity antihistamines.  Other uses of cough and cold products for children less than 6 years of age are subject to clinical prior authorization.  Products containing acetaminophen, ibuprofen, or narcotics for children less than 6 years of age are not covered.

Products require prior authorization if the product is not indicated for the person’s age.  Products containing a narcotic will require prior authorization if a child is between 6 and 12 years of age.

8.7.7. Cystic Fibrosis Treatment Products

8.7.7.1. HHSC

CSHCN Services Program

HHSC requires prior authorization for claims for Cayston, Kalydeco, Pulmozyme, and inhaled tobramycin. Prescribing providers complete and submit the Cystic Fibrosis Treatment Products Authorization Request (HHS Form 1143).

Pharmacy staff can perform an E1 eligibility verification transaction to find a person’s most current period of approval for Tobramycin.

  • Refer to the System Requirements chapter of this manual for information about claim transactions.
  • Refer to the "Field Responses for an Accepted Eligibility Verification" in the NCPDP E1 Transaction Payer Sheet for further explanation about the response.

8.7.8. Enzyme Replacement Therapy Products

8.7.8.1. HHSC

CSHCN Services Program

HHSC will reject claims with NCPDP error code “75” and the message “Prior Authorization not on file.  Contact Pharmacy Benefits Access” in the “Additional Message Information” field (526-FQ).

8.7.9. Erectile Dysfunction Products

Erectile dysfunction drugs are not a covered benefit of any program.

8.7.10. Family Planning Products

8.7.10.1. HHSC

Traditional Medicaid

Certain family planning drugs are covered and do not count towards a person’s three prescription-per-month limitation. Refer to the formulary search and select the "Family Planning" filter to identify these drugs.  

CSHCN Services Program

The prescribing physician must compose a letter of medical necessity (LMN) on office stationery.  Pharmacy staff must submit the LMN by fax to the CSHCN Service Program.

8.7.10.2. Managed Care

CHIP

CHIP covers birth control for certain diagnoses. Contraceptives are only covered for non-contraceptive medical purposes. Contact the MCO for claim submission requirements. 

8.7.12. Human Immunodeficiency Virus Products

8.7.12.1. HHSC

CSHCN Services Program

CSHCN allows 60 days of drug coverage with prior authorization.  The 60-day timeframe provides coverage while the person enrolls and receives approval or denial from the Texas HIV Medications Program.

Contact CSHCN to receive prior authorization. 

Contact the Texas HIV Medication Program at 1-800-255-1090 or online at dshs.texas.gov/hivstd/meds/. If the person is not eligible for the HIV program, the medications may be an ongoing benefit through the CSHCN Services Program if the person remains eligible.

8.7.13. Insulin and Insulin Syringes

8.7.13.1. HHSC

Traditional Medicaid

Insulin syringes are a benefit only when the syringes are for insulin use.  Insulin syringes prescribed for other injectable drugs should be billed as a Medical benefit through TMHP.  Only the insulin counts toward the person’s prescription-per-month limit.  The pharmacy may submit claims for insulin with a day supply based on stability rather than the actual dose.

KHC Program

Prescriptions for syringes and home health supplies count toward the KHC four prescription-per-month limit.

8.7.14. Influenza Vaccine

8.7.14.1. HHSC

Traditional Medicaid

During influenza season, pharmacies may bill for influenza vaccines provided to people aged seven and older in a pharmacy setting for influenza vaccines available on the Medicaid formulary as part of the pharmacy benefit.   The pharmacist administering the vaccine does not have to enroll with TMHP but must follow the TSBP rules related to certification to immunize and vaccinate.

  • Refer to 22 TAC Section 295.15 (Administration of Immunizations or Vaccinations by a Pharmacist under Written Protocol of Physician) 

Administering pharmacists are health care professionals licensed by the TSBP to practice as a pharmacist, have met and maintained the eligibility requirements outlined in law, and have been certified by the TSBP to administer vaccines. 

Administering pharmacists are under the supervision of a physician under state law and may administer immunizations or vaccinations only under a physician’s written protocol authorizing the administration. Pharmacists are employed and remunerated by a pharmacy for their services.  If the program’s services are covered and reimbursable, payment may be made to the pharmacy employing the licensed pharmacist. HHSC will reimburse pharmacies for the ingredient costs and applicable administration fees.

Refer to the Formulary search to identify these products.

8.7.14.2. Managed care

During influenza season MCOs are required to allow pharmacies to bill for influenza vaccines provided to people aged seven and older in a pharmacy setting. MCOs must cover all influenza vaccines available on the Medicaid and CHIP formularies as part of the pharmacy benefit. 

MCOs must reimburse pharmacies for the ingredient cost and applicable administration fees for flu vaccines. 

Refer to the Pharmacy MCO Assistance Chart for the pharmacy call center phone numbers for each MCO.

8.7.15. Kidney Transplant Drugs

8.7.15.1. HHSC

KHC Program

Kidney transplant drugs require prior authorization. Claims reject with error code “75” and the message “Call KHC Program (800) 222-3986” in the “Additional Message Information” field (526-FQ).

8.7.16. Long-Acting Injectables

8.7.16.1. HHSC

Traditional Medicaid

Pharmacists may administer long-acting injectables (LAIs) in a pharmacy setting for people in Medicaid with a valid prescription. Individual pharmacists can administer medications under a physician's delegation as authorized by state law. 

  • Refer to Section 554.004 (Administration of Medication,  Pharmacy Practice Act.) of the Texas Occupation Code. 

The pharmacy, not the individual pharmacist, submits claims for these services using the standard pharmacy claim transaction and is reimbursed for an ingredient cost, dispensing fee, and administration fee for each LAI claim processed.

Refer to the VDP website "Pharmacy Payer Sheets" page to review specific transaction, segment, and field requirements.

Administering pharmacists are health care professionals licensed by the TSBP to practice as a pharmacist, have met and maintained the eligibility requirements outlined in the law, and are under the supervision of a physician. Pharmacists are employed and remunerated by a pharmacy for their services. If the program's services are covered and reimbursable, payment may be made to the pharmacy employing the licensed pharmacist.

Refer to the Formulary search to identify drugs eligible for administration in a pharmacy.

8.7.16.2. Managed care

The pharmacy benefit allows pharmacists to administer long-acting injectable antipsychotics and opioid antagonists to treat a substance use disorder or opioid use disorder.

MCOs must reimburse pharmacies for the ingredient cost, dispensing fee, and applicable administration fees for certain long-acting anti-psychotics, opiate dependence treatments, and emergency treatment for known or suspected opioid overdoses.

Refer to the Pharmacy MCO Assistance Chart (PDF) for the pharmacy call center phone numbers for each MCO.

Refer to the Formulary search to identify drugs eligible for administration in a pharmacy.

8.7.17. Long-Acting Reversible Contraception Products

Providers can prescribe and obtain long-acting reversible contraception (LARC) products are on the Medicaid and HTW formularies from certain specialty pharmacies for women enrolled in Medicaid (traditional and managed care) or the HTW Program.

Refer to the Product search and select the "LARC" filter to identify products available through the pharmacy benefit.

LARC products are only available through certain specialty pharmacies working with LARC manufacturers.  Providers who prescribe and obtain LARC products through the specialty pharmacies listed will be able to return unused and unopened LARC products to the manufacturer's third-party processor.

Prescribing providers may continue to obtain LARC products through the existing buy-and-bill process.

8.7.18. Opioids

8.7.18.1. Limitations

For many people, substance use disorder starts after initially receiving opioid prescriptions for an episode of acute pain. To encourage the appropriate use of opioids and reduce the over-prescribing of opioids, Texas Medicaid has implemented the requirements in this section. The requirements in this section do not apply to clients who are: 

  • Receiving hospice care or palliative care
  • Being treated for cancer
  • Residing in a long-term care facility
  • Residing in a facility in which residents receive opioid substitution therapy for the treatment of opioid use disorder (OUD). 

The requirements also do not apply to other clients that HHSC elects to exempt based on an objective, confirmable physical pathology known to cause severe chronic pain that is not ameliorated by other therapies and for which opioid treatment is appropriate (e.g., sickle cell disease). If diagnoses are not available in the medical data, prescribers can request exemptions on a case-by-case basis through the pharmacy prior authorization process.

8.7.18.2. Prospective Safety Edits

The Medicaid policies and processes listed below are conducted automatically during the pharmacy claims submission process.

8.7.18.2.1. Morphine Milligram Equivalents

Morphine milligram equivalents (MME) per day is used to compare the potency of one opioid to another. The clinical decision for the MME per day recommendations varies depending on the person's opioid use. Additionally, the Centers for Disease Control and Prevention (CDC) recommends starting opioid treatment with an immediate-release/short-acting formulation at the lowest effective dose instead of an extended-release/long-acting formulation.

A person is considered "opioid-naïve" if the client has taken opioids for a duration that is less than or equal to seven days in the last 60 days. For clients who are opioid- naïve, providers must submit a one-time prior authorization request for:

  • An opioid prescription that exceeds a ten-day supply.
  • A prescription for a long-acting opioid formulation.
  • A claim or combination of claims in which the total daily dose of opioids exceeds 90

The one-time requirement for prior authorization does not apply to subsequent claims because the member will no longer be “opioid-naïve.” The duration of the prior authorization is equal to the days’ supply of the claim.

For clients who are not opioid naïve, prior authorization is required for opioid prescriptions if the total daily dose of opioids exceeds 90 MME. For those patients who may require a tapering plan, providers would determine the development and management of a person-specific course of therapy to help manage withdrawal symptoms.  A prescriber may request a tapering plan through the pharmacy prior authorization process on a case-by-case basis. Prior authorization approvals last for six-months.

8.7.18.2.2. Days’ Supply Limits

Opioid prescriptions for the treatment of acute pain are rarely required for more than ten days. To reduce the risk of addiction and the diversion of unused opioids, opioid prescriptions for clients who are opioid naïve are limited to a maximum ten-day supply without prior authorization.

8.7.18.2.3. Fee-For-Service Three Prescription Limit

Prescriptions for opioids to treat acute pain for clients who are 21 years of age and older are exempt from the three-prescription-per-month limit for members in fee-for-service.

8.7.18.2.4. Prospective Drug Utilization Review Alerts

Medicaid returns prospective drug utilization review alerts for pharmacists on all claims when:

  • opioids and benzodiazepines are used concurrently; and
  • opioids and antipsychotics are used concurrently;

Refer to the "Prospective Drug Utilization Review" section of the Drug Utilization Review chapter of this manual for more information about alerts. 

8.7.19. Makena

8.7.19.1. HHSC

Traditional Medicaid

Makena (hydroxyprogesterone caproate injection) requires a clinical prior authorization. Prescribing providers complete the Makena Clinical Prior Authorization Request (HHS Form 1345) and submit for review.

8.7.19.2. Managed care

Clinical prior authorization may be required.  Providers and pharmacy staff should contact MCO for requirements and forms.  Refer to the "Managed Care" section of the Contact Information chapter of this manual for form submission requirements. 

8.7.20. Migraine Medications

8.7.20.1. HHSC

Traditional Medicaid

HHSC limits medications to specific quantities per calendar month for each drug. Claims exceeding this limitation will reject with error code “76” and the message “Exceeds Max Product Quantity/Month – MI” in the “Additional Message Information” field (526-FQ).

8.7.21. Over the Counter Drugs

8.7.21.1. HHSC

Medicaid, CSHCN, and KHC cover some over-the-counter (OTC) drugs, except for clients residing in a nursing facility.

8.7.21.2. Managed care

CHIP

Insulin, diabetic supplies, and mosquito repellant are the only covered OTC items.

8.7.22. Peritoneal Treatment Products

8.7.22.1. HHSC

KHC

HHSC will reject peritoneal product claims with NCPDP error code “75” and the message “Prior Authorization not on file, call the Pharmacy Benefit Access” in the “Additional Message Information” field (526-FQ).

8.7.23. Premium Preferred Generic Drugs

6.22.1 HHSC

HHSC reimburses pharmacies an additional $0.50 incentive fee for dispensing premium preferred generic (PPG) drugs on Medicaid claims.

The PPG amount appears in the "Incentive Amount Paid" field (521-FL) of the paid claim response.  The incentive does not apply to $0.00 total payment amount claims.  Refer to the Drug Pricing and Reimbursement chapter of this manual to learn more about state reimbursement calculation.

8.7.24. Pediculosis Treatment Products

6.23.1 Vendor Drug Program

Prescribing providers can write one prescription per person in an amount covering an entire family if a person is diagnosed with lice or scabies.

8.7.25. Prenatal Vitamins

6.24.1 Vendor Drug Program 

Texas HHS limits vitamins to females under the age of 50, and will reject claims for improper age or gender:

  • Error code 6Ø ("Product Not Covered for Patient Age – PN")
  • Error code 61 ("Product Not Covered for Patient Gender – PN")

8.7.26. Pulmonary Hypertension Drugs

8.7.26.1. HHSC

CSHCN Services Program

The prescribing physician must compose a letter of medical necessity (LMN) on office stationery. Pharmacy staff must submit the LMN by fax to the CSHCN Service Program.

8.7.27. Specialty Drugs

8.7.27.1. HHSC

Traditional Medicaid

Specialty drugs on the SDL are available as either an outpatient pharmacy benefit, a medical/physician benefit, or both.

Refer to the Texas Medicaid Provider Procedure Manual for brand/generic availability, diagnosis restrictions, and billing information of products covered as a medical/physician benefit. Refer to the “Texas Medicaid and Healthcare Partnership” section of the Contact Information chapter of this manual for form submission requirements.

8.7.27.2. Managed care

HHSC provides a quarterly specialty drug list (SDL) to MCOs identifying specialty drugs offered exclusively through the MCO's specialty pharmacy network.

8.7.28. Stadol

8.7.28.1. HHSC

KHC

Stadol is limited to 10 milliliters (or 4 bottles) per calendar month. HHSC will reject claims exceeding this limitation with NCPDP error code “76” (“Plan Limitations Exceeded”) and the message “Exceeds Max Product Quantity/Month – ST” in the “Additional Message Information” field (526-FQ).

8.7.29. Synagis

Synagis is used to help prevent severe lung disease caused by a respiratory syncytial virus (RSV) in infants born prematurely and other children at high risk for severe lung disease from RSV.

HHSC bases RSV season dates on the county of residence. RSV appears earlier in some counties and remains active later in other counties. HHSC uses RSV statistics from prior years plus regular virology reports to determine the season's dates for each region and reserves the right to extend or end a season after subsequent review of RSV levels in each region. MCO medical directors can end the RSV season for their MCO by service area if they demonstrate the local virology has dropped below 10% positivity for two consecutive weeks.

Refer to the Synagis page on the VDP website to learn more about seasonal requirements and schedules.

8.7.29.1. Managed care

Medicaid and CHIP require the Texas Standard Prior Authorization Form for Prescription Drug Benefits (Texas Department of Insurance Form NORFR002).  Prescribing providers and pharmacy staff should contact the MCO for prior authorization requirements and forms. MCOs may require additional information in addition to the MCO-specific addendum form. The MCO’s form will reflect the appropriate MCO contact information and reconsideration request process.

Refer to the “Managed Care” section of the Contact Information chapter of this manual for contact instruction.

8.7.29.2. Traditional Medicaid

Prior authorization is a two-step process. The prescribing provider completes the Standard Prior Authorization Request and Synagis Standard Prior Authorization Addendum (HHSC Form 1321) and submits the prescription for Synagis and any supporting information to the Medicaid-enrolled pharmacy. Refer to the form for requirements and submission instructions. Failure to submit both forms will result in authorization denial. Pharmacy staff then submit the form to the Texas Prior Authorization Call Center. Refer to the "Pharmacy Prior Authorization" section of the Contact Information chapter of this manual for submission requirements.

8.7.29.3. CSHCN Services Program

Prior authorization is a two-step process. The prescribing provider completes the Standard Prior Authorization Request and Synagis Standard Prior Authorization Addendum (HHSC Form 1325) and submits the prescription for Synagis and any supporting information to the CSHCN-enrolled pharmacy. Refer to the form for requirements and submission instructions. Failure to submit both forms will result in authorization denial. Pharmacy staff submit the form to the CSHCN Services Program. Refer to the "Pharmacy Prior Authorization" section of the Contact Information chapter of this manual for form submission requirements.

8.7.30. Tramadol with Codeine

8.7.30.1. HHSC

Traditional Medicaid

Products containing tramadol and codeine are not available for children younger than 12. HHSC will deny Medicaid claims, including multi-ingredient compound claims, with NCPDP error code “60” (“Product/Service Not Covered For Patient Age”) and include the message “Not Covered For Under Years Of Age” in the “Additional Message Information” field (526-FQ).

8.7.31. Xenical

8.7.31.1. HHSC

Traditional Medicaid

Xenical is available only to treat hyperlipidemia and is not approved for concurrent use with other cholesterol-lowering agents. HHSC clinician staff will determine coverage. Prescribing providers complete the Medicaid Xenical Authorization Request (HHS Form 1331) and submit for review

9. Home Health Supplies

HHSC provides specific home health supply products as a pharmacy benefit to clients enrolled in Medicaid, CHIP, the CSHCN Services Program, and KHC Program.  The covered products include the following:

  • Aerosol Holding Chamber
  • Diabetic Lancets
  • Diabetic Monitor (talking)
  • Diabetic Test Strips
  • Hypertonic Salines
  • Insulin Needles
  • Insulin Syringes
  • Oral Electrolyte Replacement Fluid
  • Spring Powered Device for Lancet

CMS classifies these products as a Title XIX (Medicaid) home health benefit as either durable medical equipment (DME)  or medical supplies.

Pharmacies are not required to enroll as a Medicaid durable medical equipment (DME) provider to supply these products. Pharmacies already enrolled as Medicaid DME providers can submit claims as either a pharmacy benefit or medical benefit.  Contact the Texas Medicaid and Healthcare Partnership (TMHP) for instructions about submitting medical claims.

A physician must prescribe all DME and home health supplies. Advanced practice registered nurses and physician assistants cannot prescribe these products to clients enrolled in Medicaid or CHIP.

A list of products is available through the Formulary Product search (txvendordrug.com/formulary/formulary-search). You can search by product name, the 11-digit NDC, or select the product from the HCPCS Description dropdown. Additional filters are available to find products payable by each program. Products not included in the search are only available through the Medicaid medical benefit.

9.1. HHSC

A prescription is required for HHSC to process pharmacy claims for clients enrolled in fee-for-service Medicaid, the CSHCN Services Program, and KHC Program. HHSC does not require the Home Health Services (Title XIX) DME/Medical Supplies Physician Order Form (TMHP Form F00030) for products dispensed by a pharmacy.

The claim system will reject products submitted as part of a multi-ingredient compound claim with NCPDP error code 70 ("Product/Service Not Covered") and include the message "LHHS products are not covered in a compound claim" in the "Additional Message Information" field (526-FQ).

The claim system will reject claims if the submitted quantity exceeds the maximum unit per filling with NCPDP error code 9G ("Product/Service Not Covered"). If the quantity submitted exceeds the maximum unit per month, the claim system will reject claims with NCPDP error code 76 ("Plan Limitation Exceeded").

If the claim exceeds quantity limits, pharmacy staff must attest the submitted quantity is the actual quantity prescribed based on medical necessity by submitting the following values:

Field Name Field Number Value
Submission Clarification Code 420-DK 2 (Other override)
Prescriber ID 411-DB 10-digit National Provider Identifier

Refer to the NCPDP B1 Transaction Payer Sheet for submission requirements.

Refer to the Durable Medical Equipment, Medical Supplies, and Nutritional Products Handbook chapter of the Texas Medicaid Provider Procedures Manual (tmhp.com/resources/provider-manuals/tmppm) for quantity guideline criteria. Refer to the table below for limitations impacting claims paid by HHSC.

Product Fee-for-service limitations
Aerosol Holding Chamber (for use with a metered-dose inhaler)
  • Quantity: 1 unit maximum every 180 days
  • Refills: not limited to 5
Blood Glucose Monitor (Talking)
  • Quantity: 1 unit maximum per three rolling years
  • Refills: not limited to 5
  • Only available for people with visual impairment
Blood Glucose Strips (for monitor)
  • Quantity: 100 units maximum every calendar month
  • Refills: limited to 5
  • Day supply: 30
  • Refill-too-soon utilization: 100%
Blood Glucose Test Strips with Disposable Monitor
  • Quantity: 100 units maximum every calendar month
  • Day supply: 30
  • Refill-too-soon utilization: 100%
  • Refills: limited to 5
Hypertonic Saline Solution 3%
  • Refill-too-soon utilization: 75%
  • Refills: not limited to 5
Hypertonic Saline Solution 7%
  • Refill-too-soon utilization: 75%
  • Refills: not limited to 5
Insulin Needles
  • Refill-too-soon utilization: 75%
  • Refills: not limited to 5
Insulin Syringes (1 cc or less)
  • Refill-too-soon utilization: 75%
  • Refills: not limited to 5
Lancets
  • Quantity: 100 units maximum every calendar month
  • Day supply: 30
  • Refill-too-soon utilization: 100%
  • Refills: limited to 5
Nasal Saline Spray
  • Refill-too-soon utilization: 75%
  • Refills: not limited to 5
Oral Electrolyte Replacement Fluid
  • Refill-too-soon utilization: 75%
  • Refills: not limited to 5
Spring-powered Device for Lancets
  • Quantity: 2 units maximum per rolling year
  • Refills: not limited to 5

Claims for Medicaid do not count towards a client's three prescription-per-month limit. Claims for KHC will count towards a client's four prescription-per-month limit.

HHSC bases its reimbursement rates on the "Home Health DME" Provider Type in the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Fee Schedule and does not reimburse pharmacies a dispensing fee or delivery incentive. Refer to the Static Fee Schedules (public.tmhp.com/FeeSchedules/StaticFeeSchedule/FeeSchedules.aspx) page for the individual reimbursement rates.

HHSC does not require the TMHP DME Certification and Receipt Form (Form F00018) for pharmacy claims.

9.2. Managed care

Pharmacies submit claims for clients enrolled in Medicaid managed care and CHIP to the client's MCO.  MCOs have the flexibility to manage a preferred home health supplies list for the limited home health supplies.  Contact the MCO using the MCO Pharmacy Assistance Chart to determine billing requirements, reimbursement rates, and coverage limitations.

10 .Vitamins and Minerals

HHSC provides specific vitamin and mineral products as a pharmacy benefit to clients 20 years of age or younger and enrolled in Medicaid, CHIP, the CSHCN Services Program, and KHC Program. The products are also available through the Medicaid Comprehensive Care Program (CCP) as a medical benefit.

Pharmacies are not required to enroll in the CCP or as a Medicaid durable medical equipment (DME) provider to supply these products. Pharmacies already enrolled as Medicaid CCP or DME providers can submit claims as a pharmacy benefit or medical benefit. Contact the Texas Medicaid and Healthcare Partnership (TMHP) for instructions about submitting medical claims.

Prescribing providers enrolled with Medicaid as DME providers should continue to submit claims for traditional Medicaid clients to TMHP. Refer to the Children's Services Handbook of the Texas Medicaid Provider Procedures Manual (tmhp.com/resources/provider-manuals/tmppm).

A list of products is available through the Formulary Product search (txvendordrug.com/formulary/formulary-search). You can search by product name, the 11-digit NDC, or click the "vitamin and mineral" checkbox. Additional filters are available to find products payable by each program. A list of products and their associated condition are below.

The Medicaid CCP may pay for products not available on the search for clients enrolled in traditional Medicaid for particular medical conditions.

Vitamin or Mineral Condition
Beta-carotene Vitamin A deficiency, Cystic fibrosis, Disorders of porphyrin metabolism, Intestinal malabsorption
Biotin Biotin deficiency, Biotinidase deficiency, Carnitine deficiency
Calcium Calcium deficiency, Disorders of calcium metabolism, Chronic renal disease, Pituitary dwarfism, isolated growth hormone deficiency, Hypocalcemia and hypomagnesemia of the newborn, Intestinal disaccharidase deficiencies and disaccharide malabsorption, Allergic gastroenteritis and colitis, Hypocalcemia due to use of Depo-Provera contraceptive injection
Iodine Iodine deficiency, Simple and unspecified goiter, and nontoxic nodular goiter
Iron Disorders of iron metabolism, Iron deficiency anemia, Sideroachrestic anemia
Magnesium Magnesium deficiency, Hypoparathyroidism
Multi-minerals Other and unspecified protein-calorie malnutrition
Multi-vitamins Cystic fibrosis, Other and unspecified protein-calorie malnutrition
Phosphorus Disorders of phosphorus metabolism
Trace elements Mineral deficiency
Vitamin A (retinol) Vitamin A deficiency, Intestinal malabsorption, Disorders of the biliary tract, Cystic fibrosis
Vitamin B1 (thiamin) Vitamin B1 deficiency, Disturbances of branched-chain amino-acid metabolism (e.g., maple syrup urine disease), Disorders of mitochondrial metabolism, Wernicke-Korsakoff syndrome
Vitamin B2 (riboflavin) Vitamin B2 deficiency, Disorders of fatty acid oxidation, Riboflavin deficiency, ariboflavinosis, Disorders of mitochondrial metabolism
Vitamin B3 (niacin) Vitamin B3 deficiency, Disorders of lipid metabolism, (e.g., pure hypercholesterolemia)
Vitamin B5 (pantothenic acid) Vitamin B5 deficiency
Vitamin B6 (pyridoxine, pyridoxal 5phosphate) Vitamin B6 deficiency, Sideroblastic anemia
Vitamin B12 (cyanocobalamin) Vitamin B12 deficiency, Disturbances of sulfur-bearing amino-acid metabolism (e.g., homocystinuria and disturbances of metabolism of methionine), Pernicious anemia, Combined B12, and folate-deficiency anemia
Vitamin C (ascorbic acid) Vitamin C deficiency, Anemia due to disorders of glutathione metabolism, Disorders of mitochondrial metabolism
Vitamin D (ergocalciferol) Vitamin D deficiency, Galactosemia, Glycogenosis, Disorders of magnesium metabolism, Intestinal malabsorption, Chronic renal disease, Cystic fibrosis, Disorders of phosphorus metabolism, Hypocalcemia, Disorders of the biliary tract, Hypoparathyroidism, Intestinal disaccharidase deficiencies, and disaccharide malabsorption, Allergic gastroenteritis, and colitis
Vitamin E (tocopherols) Vitamin E deficiency, Inflammatory bowel disease (e.g., Crohn's, granulomatous enteritis, and ulcerative colitis), Disorders of mitochondrial metabolism, Chronic liver disease, Intestinal malabsorption, Disorders of the biliary tract, Cystic fibrosis
Zinc Zinc deficiency, Wilson's disease, Acrodermatitis enteropathica

10.1. HHSC

A prescription is required for HHSC to process pharmacy claims for clients enrolled in fee-for-service Medicaid and the CSHCN Services Program.

HHSC does not require the TMHP CCP Prior Authorization Request Form for products dispensed by a pharmacy. Refer to the Durable Medical Equipment, Medical Supplies, and Nutritional Products Handbook of the Texas Medicaid Provider Procedures Manual (tmhp.com/resources/provider-manuals/tmppm) for quantity guideline criteria.

Claims for traditional Medicaid do not count towards a client's three prescription-per-month limit.

HHSC sets the reimbursement rate at the Average Wholesale Price minus 10.5 percent, minus 8 percent. Pharmacies do not receive a dispensing fee or delivery incentive.

Multi-ingredient compound claims submitted with vitamin or mineral products are not payable. HHSC may consider some compound claims for coverage through CCP.

Claims are limited to a 30-day supply. Pharmacy staff should contact HHSC for liquid formulations greater than this limit. Pharmacies should not dispense refills until the client uses 100% of the supply. Prescriptions are valid for six months after the date written.

Pharmacy staff must acknowledge the prescribed product is for a medically accepted indication according to the current vitamin and mineral policy by submitting the following values:

Field Name Field Number Value
Prior Authorization Type Code 461-EU 8 (Payer Defined Exemption)
Prior Authorization Number Submitted 463-EV 826 (Medically accepted indication for vitamins and minerals)

HHSC does not require the DME Certification and Receipt Form (TMHP Form F00018) for pharmacy claims.

10.2. Managed care

Pharmacies submit claims for clients enrolled in Medicaid managed care and CHIP to the client's MCO.  Contact the MCO using the MCO Pharmacy Assistance Chart to determine billing requirements, reimbursement rates, and coverage limitations.

11. Mosquito Repellent

1. Mosquito Repellent Benefit

Texas HHS covers mosquito repellents for the prevention of the Zika virus. HHS initially offered the benefit between Aug. and Dec. 2016 and again between April and Dec. 2017. Mosquito repellents became a year-round benefit as of Feb. 2018.

Download the Mosquito Repellent Benefit Information to display information about the benefit in pharmacies or doctor offices. For more information about the Zika virus, refer to the following resources:

1.1 Eligible Populations

The eligible populations for the mosquito repellent benefit include:

  • Females ages 10-55 years old and pregnant females of any age 
  • Males ages 14 and older

1.2 Quantity

Coverage of mosquito repellents is limited to two cans or bottles per calendar month.  Pharmacies should dispense only one can or bottle per fill, with one optional refill available per calendar month.

Mosquito repellent claims do not count against a person’s monthly three-prescription limit for people enrolled in traditional Medicaid.

1.3 Client Responsibility

Approved claims for people eligible for Medicaid, HTW program, and CSHCN Services Program are provided at no cost.

People enrolled in CHIP may be subject to a copay depending upon family income. Any potential copays should not exceed the cost of the product.

1.4 Covered Products

Texas HHS selected products based on guidance from the Centers for Disease Control and include the recommended amount of the active ingredient DEET, IR3535, oil of lemon eucalyptus, or Picaridin effective against the Zika virus.

NDC Product Name Product UPC Package Size Unit of Measure Active Ingredient
11423000338 Repel Sportsmen Max 40% spray 011423003387 184 GM DEET
11423094109 Repel Lemon Eucalyptus 30% spray 011423941092 118 ML Oil of Lemon Eucalyptus
11423094133 Repel Sportsmen Dry 25% spray 011423941337 113 GM DEET
11423094137 Repel Sportsmen 25% spray 011423941375 184 GM DEET
11423094139 Repel Hunter's 25% spray 011423941399 184 GM DEET
46500071764 Off Deep Woods Dry 25% spray 046500717642 113 GM DEET
46500001842 Off Deep Woods 25% spray 046500018428 170 GM DEET
46500001859 Off Deep Woods 25% spray 04650001859X 311 GM DEET
46500021845 Off Deep Woods 25% spray 046500218453 177 ML DEET
46500022930 Off Deep Woods 25% spray 04650022930X 255 GM DEET
46500061851 Off Deep Woods Sportsmen 30% spray 046500618512 170 GM DEET
46500072131 Off Deep Woods Dry 25% spray 04650072131X 113 GM DEET
46500072925 Off Deep Woods 25% spray 046500729256 266 ML DEET
46500081846 Off Deep Woods Sportsmen 25% spray 046500818462 177 ML DEET
51131067777 Ultrathon 25% repellent spray 051131677777 170 GM DEET
68093000746 Coleman SkinSmart 368093007468 147 ML IR3535
68093000747 Coleman SkinSmart 368093007473 170 GM IR3535
68093007514 Coleman High-Dry 25% spray 368093075146 113 GM DEET
68093007732 Coleman Botanicals insect spray 368093077324 118 ML Oil of Lemon Eucalyptus
71121096014 Cutter Lemon Eucalyptus spray 071121960146 118 ML Oil of Lemon Eucalyptus
71121096280 Cutter Backwoods 25% spray 071121962805 170 GM DEET
71121096283 Cutter Backwoods 25% spray 071121962836 311 GM DEET
71121096284 Cutter Backwoods 25% spray 071121962843 177 ML DEET
71121096435 Cutter Backwoods Dry 25% spray 071121964359 113 GM DEET
44224006878 Natrapel 20% spray 044224068781 177 ML Picaridin
50716000544 Insect Repellent 20% spray (Sawyer) 050716005448 118 ML Picaridin

1.5 Refills

Pharmacies should process refills per the prescription detail if operating under written prescription or the Texas Medicaid Standing Order for Mosquito Repellent. If you operate under the standing order, contacting or faxing the physician listed on the standing order is unnecessary for refill requests or fax refill requests.

1.6 Other Medicaid Benefits

Other Medicaid benefits available in response to Zika virus prevention include oral contraceptives and long-acting reversible contraceptive products that help to prevent pregnancy. These are available as a Medicaid benefit to eligible individuals. Other covered benefits include family planning services, diagnostic testing, targeted case management, physical therapy, long-term services and support, acetaminophen and oral electrolytes for Zika virus symptoms, and potential coverage for additional ultrasounds for pregnant women.

2. Covered Programs

The mosquito repellent benefit is available for people enrolled in the following programs:

  • Medicaid (traditional and managed care)
  • Children's Health Insurance Program and CHIP-Perinatal
  • Healthy Texas Women program (HTW)
  • Children with Special Health Care Needs services program

2.1 Medicaid, CHIP and HTW

HHSC issued the Texas Medicaid Standing Order for Mosquito Repellent for use by people enrolled in Medicaid, CHIP and HTW. This order serves as a prescription and allows pharmacists to dispense mosquito repellent under the terms of the order. Pharmacies are encouraged to use this order instead of contacting the person’s healthcare providers for individual prescriptions for mosquito repellent. A prescription from a valid healthcare provider is required for any pharmacy or pharmacist not operating under the standing order.

Pharmacy staff request a copy of the standing order by emailing vdp-formulary@hhsc.state.tx.us.

The Mosquito Repellent Standing Order Prescription Template (HHS Form 1404) is available on the VDP website. The template is used only in the processing of claims for mosquito repellent for people enrolled in Texas Medicaid, CHIP and HTW under the standing order for mosquito repellent. Any unauthorized use of the prescriber information within the template is referred to the HHS Inspector General as potential fraud.

2.2 CSHCN Services program

A prescription is required for people enrolled in the CSHCN services program. Contact the person’s health care provider to obtain a prescription for mosquito repellent.

3. Pharmacy Claim Submission

3.1 Prescriptions

Pharmacy Claims

Claims for mosquito repellent must use the appropriate prescriber National Provider Identifier (NPI) as directed in the pharmacy claims submission table, below.

Prescriber NPI Medicaid CHIP CSHCN HTW
Client's Healthcare Provider
Dr. Van Ramshorst  

3.2 Products

  • Each product’s 12-digit Universal Product Code (UPC) has been converted into an 11-digit National Drug Code (NDC) for claims submission.
  • Mosquito repellent will be treated as a generic medication and pharmacies have the authority to fill the prescription with any covered product, unless the prescriber has stated "do not substitute" to specify the active ingredient.

3.3 Unit of Measure 

Pharmacy staff submit the standard unit in the “Unit of Measure” field (60028) when processing claims.

For example, a 170-gram bottle should be submitted with a quantity of 170. 

3.4 Days Supply 

A can of repellent is expected to last 15 days or more. Pharmacy staff are recommended to submit a 15-day supply.

3.5 Reimbursement

  • The traditional Medicaid reimbursement is the usual and customary price to the public or up to a maximum of $6.50 per can/bottle of mosquito repellent (inclusive of product cost and dispensing fee), with the total calendar month maximum of $13.00. Products are not eligible for delivery fees or incentive fees.
  • Reimbursement may vary between MCOs but may not exceed $6.50 per can/bottle.
  • Pharmacies will be required to submit their usual and customary cost for the items. 

3.6 Overrides

Manual overrides for pregnant women 9 or younger or 55 or older may be needed.

Appendix A. Mosquito Repellent Products

Covered products have been selected based on guidance from the Centers for Disease Control and include the recommended amount of the active ingredient DEET, IR3535, oil of lemon eucalyptus, or Picaridin.

NDC Product Name Product UPC Package Size Unit of Measure Active Ingredient
11423000338 Repel Sportsmen Max 40% spray 011423003387 184 GM DEET
11423094109 Repel Lemon Eucalyptus 30% spray 011423941092 118 ML Oil of Lemon Eucalyptus
11423094133 Repel Sportsmen Dry 25% spray 011423941337 113 GM DEET
11423094137 Repel Sportsmen 25% spray 011423941375 184 GM DEET
11423094139 Repel Hunter's 25% spray 011423941399 184 GM DEET
46500071764 Off Deep Woods Dry 25% spray 046500717642 113 GM DEET
46500001842 Off Deep Woods 25% spray 046500018428 170 GM DEET
46500001859 Off Deep Woods 25% spray 04650001859X 311 GM DEET
46500021845 Off Deep Woods 25% spray 046500218453 177 ML DEET
46500022930 Off Deep Woods 25% spray 04650022930X 255 GM DEET
46500061851 Off Deep Woods Sportsmen 30% spray 046500618512 170 GM DEET
46500072131 Off Deep Woods Dry 25% spray 04650072131X 113 GM DEET
46500072925 Off Deep Woods 25% spray 046500729256 266 ML DEET
46500081846 Off Deep Woods Sportsmen 25% spray 046500818462 177 ML DEET
51131067777 Ultrathon 25% repellent spray 051131677777 170 GM DEET
68093000746 Coleman SkinSmart 368093007468 147 ML IR3535
68093000747 Coleman SkinSmart 368093007473 170 GM IR3535
68093007514 Coleman High-Dry 25% spray 368093075146 113 GM DEET
68093007732 Coleman Botanicals insect spray 368093077324 118 ML Oil of Lemon Eucalyptus
71121096014 Cutter Lemon Eucalyptus spray 071121960146 118 ML Oil of Lemon Eucalyptus
71121096280 Cutter Backwoods 25% spray 071121962805 170 GM DEET
71121096283 Cutter Backwoods 25% spray 071121962836 311 GM DEET
71121096284 Cutter Backwoods 25% spray 071121962843 177 ML DEET
71121096435 Cutter Backwoods Dry 25% spray 071121964359 113 GM DEET
44224006878 Natrapel 20% spray 044224068781 177 ML Picaridin
50716000544 Insect Repellent 20% spray (Sawyer) 050716005448 118 ML Picaridin

12. Drug Utilization Review

1. Drug Utilization Review

Drug utilization review (DUR) is a process required by federal law in the Omnibus Budget Reconciliation Act of 1990 (OBRA 90) to assure that prescriptions for covered outpatient drugs are appropriate, medically necessary, and not likely to result in adverse medical results.

DUR is designed to educate both prescribing providers and pharmacy staff on how to identify and reduce the frequency of patterns of fraud, abuse, gross overuse, or inappropriate or medically unnecessary care among prescribing providers, pharmacists, and people enrolled in Medicaid.  Education and alerts are made available to prescribing providers and pharmacists both prospectively and retrospectively about:

  • Medication appropriateness
  • Overutilization and underutilization
  • Appropriate use of generic products
  • Therapeutic duplication
  • Drug-disease contraindications
  • Drug-drug interactions
  • Incorrect drug dosage or duration of drug treatment
  • Drug-allergy interactions
  • Clinical abuse/misuse

The DUR process assesses data on drug use against predetermined standards, consistent with the following:

1. Compendia consisting of the following:

  • American Hospital Formulary Service Drug Information
  • United States Pharmacopeia-Drug Information (or its successor publications)
  • DRUGDEX Information System

2. Peer–reviewed medical literature

2. Prospective Drug Utilization Review

Prospective DUR (ProDUR) is a review of a person’s medication record and prescription drug orders prior to dispensing.

The ProDUR review of drug therapy is performed before each prescription is filled or delivered to the person, typically at the point-of-sale or point of distribution.  This process assists the pharmacist by addressing situations in which potential drug problems may exist.  ProDUR performed prior to dispensing helps pharmacists ensure that the person receives appropriate medications.  This is accomplished by providing information through messaging from the claim submission system to the dispensing pharmacist that may not have been previously available particularly if the person is using more than one pharmacy.

The prospective review includes:

  • Screening for potential drug therapy problems due to therapeutic duplication
  • Drug-disease contraindications
  • Drug-drug interactions (including serious interactions with nonprescription or over-the-counter drugs)
  • Incorrect drug dosage or duration of drug treatment
  • Drug-allergy interactions
  • Clinical prior authorizations
  • Clinical abuse/misuse

HHSC uses the compendia and literature as its source of standards for such review.

The ProDUR processes of the VDP pharmacy claims system examines all pharmacy claims.  As a result, drugs that interact, or are affected by previously dispensed medications, can be detected.  VDP recognizes that the pharmacist uses his or her education and professional judgment in all aspects of dispensing.  ProDUR is offered as an informational tool to aid the pharmacist in performing his/her professional duties.  Most ProDUR edits are driven by day supply, making it important that this field is reported correctly.

2.1 ProDUR Alerts 

Alerts concerning clinically significant drug-drug interactions, therapeutic duplications, ingredient duplications, or maximum dosage are part of the claim adjudication process.

Alerts do not cause claims to reject and are intended to provide information to assist the pharmacist in working with the prescribing provider to provide appropriate pharmaceutical therapy.

Alerts are contained in the “Drug Use Review/Professional Pharmacy Service

(DUR/PPS)” segment in fields noted within Table 1.  Refer to the “NCPDP B1 Transaction Paid Response” and “NCPDP B1 Transaction Rejected Response” payer

sheets for specific transaction, segment, and field requirements.  Download the VDP Pharmacy Provider Payer Sheets.

Table 1 - VDP ProDUR Alerts

NCPDP Field Name

Field #

Value

Reason for Service Code

439-E4

DD = Drug-Drug Interaction
HD = High Dose
ID = Ingredient Duplication
TD = Therapeutic

Clinical Significance Code

528-FS

Blank = Not Specified
1 = Major
2 = Moderate
3 = Minor

Other Pharmacy Indicator

529-FT

Ø = Not Specified
1 = Your Pharmacy
2 = Other Pharmacy in Same Chain
3 = Other Pharmacy

Previous Date of Fill

53Ø-FU

 

Quantity of Previous Fill

531-FV

 

Database Indicator

532-FW

Blank = Not Specified
1 = First Databank

Other Prescriber Indicator 533-FX Ø = Not Specified

1 = Same Prescriber
2 = Other Prescriber

    The system's ProDUR processes assist the pharmacist by addressing situations in which potential drug problems may exist.  ProDUR performed prior to dispensing helps pharmacy staff ensure that the person receives clinically appropriate medications.  This is accomplished by providing information to the dispensing pharmacist that may not have been previously available particularly if the person is using more than one pharmacy.  The system assists pharmacy staff in the prospective review for people enrolled in Medicaid by providing online information on prescriptions paid by VDP within the defined time period. Examples of DUR messages include the clinically significant drug/drug interactions and therapeutic duplications. 

    Prospective (concurrent) drug use review edits apply to all claims unless otherwise identified.

    2.2 DUR Rejections

    The VDP system provides information regarding therapeutic duplication, ingredient duplication, maximum dosage, and significance level 1 and 2 (First Data Bank) drug-drug interactions for those prescriptions paid by Medicaid, CSHCN, or KHC programs. Since some people are limited to a specific number of prescription drug claims per month, the person’s medication record at the dispensing pharmacy must be reviewed to ensure the inclusion of a complete drug history in the prospective DUR process. Drug allergy and disease state information will not be available online, and will also have to be reviewed from the person’s medication record.

    The selected claims with the greatest potential for adverse therapeutic outcomes will reject with NCPDP code “88” ("DUR Reject Error").  Refer to the “NCPDP B1 Transaction Rejected Response” payer sheets for specific field requirements.  Download the VDP Pharmacy Provider Payer Sheets from txvendordrug.com/about/policy/payer-sheets.

    Pharmacy staff will have the ability to override the DUR rejection by submitting the “DUR Reason for Service Code”, “DUR Professional Service Code”, and “DUR Result of Service Code” fields on the claim (see Table 2) if it is determined that the prescribing provider understands the risk to be acceptable, and appropriate monitoring measures are undertaken. The override can also be submitted on the initial claim submittal, if appropriate, thus bypassing the rejection. The override capability will allow payment of the rejected claims when appropriate without pharmacy staff intervention.

    Refer to the “NCPDP B1 Transaction Billing Request” payer sheets for specific field requirements.  Download the VDP Pharmacy Provider Payer Sheets.

    Table 2 - VDP DUR Rejection Override

    Field Name Field Number Accepted Values
    DUR Reason for Service 439-E4

    DD - Drug-Drug Interaction
    HD - High Dose
    ID - Ingredient Duplication
    TD - Therapeutic Duplication

    DUR Professional Services Code 44Ø-E5

    ØØ - No Intervention
    MØ - Prescriber Consulted
    PØ - Patient Consulted
    RØ - Pharmacist consulted other source

    DUR Result of Service Code 441-E6

    1A - Filled As Is, False Positive
    1B - Filled Prescription As-Is
    1C - Filled, With Different Dose
    1D - Filled, With Different Directions
    1F - Filled, With Different Quantity
    1G - Filled, With Prescriber Approval
    4A  - Prescribed with acknowledgement

    Only claims paid through the VDP system will be screened for interactions, duplication, and maximum dosage online. It is necessary that the required Patient Medication Record (PMR) be reviewed for additional drugs not paid by Medicaid, CHIP, CSHSN, or KHC. This is especially important for those people limited to three prescriptions per month. The PMR must also be reviewed by pharmacist to evaluate drug disease contraindications, drug allergy interactions, and duration of drug treatment since this information is not in the VDP system at this time.

    2.3 DUR Result of Service

    Claims that are reversed because of a DUR advisory message must have an accompanying standard “DUR Result of Service Code” value submitted (see Table 3).  These values allow VDP staff to measure the effectiveness of advisories and document action taken by the pharmacist.

    Table 3 - DUR Result of Service Codes Values

    Field Name Field Number Accepted Values
    DUR Result of Service Code 441-E6

    1C - Filled with a different dose
    1D - Filled with different directions
    1E - Filled with a different drug
    1F - Filled with a different quantity
    2A - Prescription not filled
    2B - Not filled, directions clarified

    This value must be submitted on reversals caused by a DUR message because the Centers for Medicare & Medicaid Services (CMS) requires all state Medical programs to demonstrate positive results from online ProDUR.  Pharmacy staff should contact their software vendor for questions relating to the appropriate submission of these codes on reversal transactions.

    2.4 OBRA 90 Requirements for Pharmacies

    OBRA 90 mandates that, effective January 1, 1993, state Medicaid programs require enrolled pharmacies to:

    • Perform prospective drug user review
    • Maintain a person’s medication records (profiles)
    • Counsel people on each new prescription

    The Texas State Board of Pharmacy (TSBP) incorporated the OBRA 90 requirements into the pharmacy rules, adopted December 1992.  Pharmacies in compliance with the TSBP rules are in compliance with the OBRA 90 Medicaid requirements.

    2.4.1 Perform Prospective Drug User Review (DUR)

    At the time of dispensing a prescription drug order, the pharmacist must review the person’s medication record to identify:

    • Clinically significant drug-drug interactions
    • Therapeutic duplication
    • Drug-disease contraindication
    • Drug allergy interactions
    • Incorrect drug dosage or duration of drug treatment
    • Clinical abuse/misuse

    Upon identifying any clinically significant conditions, situations, or items listed above, the pharmacist shall take appropriate steps to avoid or resolve the problem including consultation with the prescribing provider.

    2.4.2 Medication Records

    The pharmacist must make a reasonable effort to obtain and record, in the person’s medication record, the following information on the person presenting a prescription:

    • Full name of the person for whom the drug is prescribed
    • Address and telephone number of the person
    • The person’s age and/or date of birth
    • The person’s gender
    • Any known allergies, drug reactions, idiosyncrasies, and chronic conditions or disease states of the person and the identity of any other drugs currently being used by that person may relate to prospective drug review.
    • Pharmacist's comments relevant to the person’s drug therapy, including any other information unique to the specific person or drug.
    • A list of all prescription drug orders dispensed (new and refill) to the person by the pharmacy during the last two years. Such list shall contain the following information:
      • Date dispensed
      • Name, strength, and quantity of the drug dispensed
      • Prescribing provider’s name
      • Unique identification number of the prescription
      • Name or initials of the dispensing pharmacists

    Individual medication records (profiles) must comply with and be maintained in compliance with TSBP regulations. The pharmacist may delegate the collection of the individual medication record to a technician. The pharmacist or designee is not required to obtain and record the person's information in a profile (medication record) if the person or his or her agent refuses to provide the necessary information for such individual medication records (profiles).

    2.4.3 Counseling

    The pharmacist is required to communicate to the person (or his or her agent) information concerning the dispensed prescription drug or device, including at a minimum the following:

    • The name and description of the drug
    • Dosage form, dosage, route of administration, and duration of drug therapy
    • Special directions and precautions for preparation, administration, and use by the person
    • Common severe side or adverse effects or interactions and therapeutic contraindications that may be encountered, including their avoidance, and the action required if they occur
    • Techniques for self-monitoring of drug therapy
    • Proper storage
    • Refill information
    • Action to be taken in the event of a missed dose

    The pharmacist is not required to provide consultation when the person (or his or her agent) refuses such consultation. The pharmacist shall document such refusal for consultation.

    TSBP rules require that written information accompany prescription drug orders be delivered to the person or a representative agent of that person.  Provision of written information must be in compliance with TSBP rules.

    Counseling requirements are to be in compliance with TSBP regulations. The counseling function must be performed by the pharmacist and cannot be delegated to a technician.

    3. Retrospective Drug Utilization Review

    Retrospective DUR provides for the ongoing periodic examination of claims data and other records to identify patterns of fraud, abuse, gross overuse, or inappropriate or medically unnecessary care among prescribing providers, pharmacists, and people associated with specific drugs or groups of drugs.

    The retrospective review also allows for active and ongoing educational outreach in the form of letters or face-to-face discussions to educate prescribing providers on common drug therapy problems with the aim of improving prescribing or dispensing practices.

    4. Texas Drug Utilization Review Board

    The Texas DUR Board is an HHSC advisory committee that meets quarterly in Austin to:

    • Develop recommendations for the Medicaid preferred drug list
    • Suggest clinical prior authorizations on outpatient prescription drugs
    • Recommend educational interventions for Medicaid providers
    • Review drug utilization across the Medicaid program

    The board includes physicians and pharmacists who provide services across the entire Medicaid population, as well as one physician and one pharmacist representing the managed care organizations, and one consumer advocate who represents people enrolled in Medicaid. 

    13. Prior Authorization

    P-13.1. Medicaid

    Prior authorization is a process used to determine if a prescribed procedure, service, or medication is necessary, appropriate, and not likely to cause adverse effects. Prescribing providers must submit an authorization request for the drug before Medicaid pays the claim.

    Each MCO administers pharmacy prior authorization services for clients enrolled in managed care. The Texas Prior Authorization Call Center manages prior authorizations for clients in Medicaid fee-for-service.

    All clients enrolled in Medicaid adhere to the same formulary. Some drugs on the formulary may require prior authorization. There are two types of prior authorizations impacting a covered Medicaid outpatient drug on the formulary

    • Clinical
    • Non-preferred

    Some drugs or drug classes are subject to both non-preferred and clinical prior authorizations.

    The Texas Drug Utilization Review (DUR) Board reviews classes of drugs every quarter and recommends drugs for preferred or non-preferred status on the Texas Medicaid Preferred Drug List (PDL), and establishes recommendations for clinical prior authorizations.

    P-13.1.1. Clinical

    Clinical prior authorizations may apply to a particular drug or an entire drug class on the formulary, including preferred and non-preferred drugs.

    HHSC establishes clinical prior authorizations based on recommendations from the DUR board using the latest FDA-approved product labeling, national guidelines, peer-reviewed literature, and evidence-based clinical criteria. The board reviews prospective clinical prior authorizations criteria proposed by HHSC in collaboration with MCOs and other stakeholders.

    HHSC and MCOs may implement board-recommended clinical prior authorizations at any time. HHSC requires MCOs to perform specific clinical prior authorizations. The usage of the other clinical prior authorizations will vary between each MCO.

    Each clinical prior authorization has a criteria guide describing how Medicaid evaluates requests. All steps in the criteria guide apply to traditional Medicaid claims. MCOs may decide to use any or all of the approved criteria as long as the prior authorization is not more restrictive.

    Refer to the clinical prior authorization criteria guides at the Texas Prior Authorization Portal (paxpress.txpa.hidinc.com) for more information.

    Refer to the Pharmacy Clinical Prior Authorization Assistance Chart for a list of the clinical prior authorizations each MCO uses and how those authorizations relate to those used for processing fee-for-service Medicaid claims.

    Clinical prior authorizations are periodically revised to ensure they reflect prescribing recommendations of the current state and nationally established drug criteria, information from approved compendia, and the peer-reviewed literature.

    P-13.1.1.1. Required MCO Clinical Prior Authorizations

    HHSC requires MCOs to implement specific clinical prior authorizations for clients enrolled in managed care. The table below identifies the dates MCOs must implement specific clinical prior authorizations. Clinical prior authorizations with an end date are no longer required and are now optional. Refer to the Pharmacy Clinical Prior Authorization Assistance Chart to identify whether an MCO still uses the criteria.

    Clinical Prior Authorization Required Start Date Required End Date
    Antipsychotics March 1, 2012 May 15, 2018
    Hepatitis C Virus April 8, 2015  
    Orkambi (part of Cystic Fibrosis Agents) January 21, 2016 March 1, 2021
    Promethazine/Promethazine Containing Products March 1, 2012  
    Synagis September 23, 2014  

    P-13.1.1.2. Optional MCO Clinical Prior Authorizations

    Implementation of all other board-approved clinical prior authorization is optional and will vary between VDP and the MCOs at the discretion of each MCO. An MCO may use any or all of the board-recommended clinical prior authorizations criteria but is not permitted to implement more stringent prior authorization criteria than the board approved.

    Refer to the VDP website Managed Care Clinical Prior Authorization page (txvendordrug.com/formulary/prior-authorization/mco-clinical-pa) for the list of clinical prior authorizations MCOs have the option to perform for people enrolled in Medicaid.

    Refer to the VDP website MCO Resources page (txvendordrug.com/resources/managed-care/mco-resources) for a link to the clinical prior authorization page on each MCO's website.

    P-13.1.1.3. Fee-for-service Clinical Prior Authorizations

    Refer to the VDP website Fee-for-service Clinical Prior Authorization page (txvendordrug.com/formulary/prior-authorization/ffs-clinical-pa) for the list of clinical prior authorizations HHSC implemented for people enrolled in traditional Medicaid.

    HHSC pharmacists review prior authorization requests for the following drugs:

    • Xenical (orlistat)

    Refer to the list of Medicaid FFS Prior Authorization Requests for forms. Refer to the instructions on each form for submission information.

    P-13.1.2. Non-preferred

    HHSC arranges the PDL by drug class, and it contains a subset of many, but not all, drugs found on the Medicaid formulary. Preferred drugs on the PDL are selected using criteria based on safety, efficacy and cost, and are available without prior authorization unless there is a clinical prior authorization associated with the drug. Non-preferred drugs require a PDL prior authorization. Some preferred drugs may also require clinical prior authorization.

    The PDL Criteria Guide explains the criteria used to evaluate the non-preferred prior authorization requests.

    MCOs use the same non-preferred prior authorization criteria requirements but may have non-preferred requirements on a limited set of home health supplies provided by Medicaid-enrolled pharmacies.

    P-13.1.2.1. Preferred Drug List

    The DUR board makes PDL recommendations each quarter and submits them for review to the HHSC Executive Commissioner.  The biannual PDL incorporates the commissioner’s decisions on the schedule identified in the following table.

    Board Meets / PDL Recommendations Published PDL Published
    January July
    April July
    July January
    October January

    Refer to the VDP website DUR Board Agenda and Documents page (txvendordrug.com/resources/drug-utilization-review-board/meeting-agendas-and-documents) for each board meeting's recommendations and the HHS-approved decisions.

    HHSC organizes the PDL by therapeutic class, identifying the preferred agents, non-preferred agents, and any prior authorization criteria. The PDL identifies drugs requiring clinical prior authorization with a hyperlink to the clinical criteria document.

    Refer to the VDP website Preferred Drug page (txvendordrug.com/formulary/prior-authorization/preferred-drugs) to review the latest edition of the PDL.

    The VDP Formulary Drug Search identifies drugs requiring non-preferred prior authorization. Users can select the "PDL PA Required" check-box for the list of drugs.

    P-13.1.3. Obtaining Prior Authorization

    In certain instances, pharmacy and medical claims data will be available to indicate when a person has met the prior authorization criteria. In those cases, the prescription is authorized automatically at the point of sale without any notification to prescribing provider or dispensing pharmacy.

    If supporting claims data is not available to the automated prior authorization system, the claim will reject with NCPDP error code 75 ("Prior Authorization Required"). Pharmacy staff should notify the prescribing providers or their representatives about the prior authorization requirement so they can request authorization. Pharmacy staff cannot request authorization. A decision from the prior authorization authority to approve or deny the request is made within 24 hours of the initial request.

    Refer to the contact section for FFS Medicaid Clinical Prior Authorization contact information.

    Refer to the contact section for FFS Medicaid Non-preferred Prior Authorization contact information.

    Refer to the contact section for MCO Prior Authorization contact information.

    The Texas Department of Insurance requires HHSC to publish the Texas Standardized Prior Authorization Request Form for Health Care Services (TDI Form NOFR002) for prescribing providers as of September 1, 2015. Refer to 1 TAC Section 19.1820 (Prior Authorization Request Form for Prescription Drug Benefits, Required Acceptance, and Use) on the VDP website Rules and Statutes page (txvendordrug.com/about/rules).

    Providers use this form to request prior authorization by fax or mail. Some medications will require providers to submit an addendum form to capture additional information. Failure to submit both the Standardized Prior Authorization Request and addendum may result in an authorization denial. Refer to the Medicaid Fee-for-service Prior Authorization Requests section for a list of addendum forms.

    P-13.1.4. Emergency Override

    The pharmacy should provide a 72-hour emergency supply of the prescribed drug when a client needs medication without delay and prior authorization is not available. This applies to drugs that are non-preferred on the preferred drug list and or drugs subject to clinical prior authorization. The emergency override protocol applies to clients enrolled in traditional Medicaid and Medicaid managed care.

    Before dispensing a 72-hour emergency supply, the dispensing pharmacist should use professional judgment to determine if taking the prescribed medication jeopardizes the client's health or safety and make good faith efforts to contact the prescribing provider.

    A 72-hour emergency prescription will be paid in full, and it does not count toward the three-prescription limit for adults who have not already received their maximum prescriptions for the month. This procedure should not be used for routine and continuous overrides.

    Pharmacy staff should submit the information in the table below for emergency override claims.

    Field Name Field Number Value

    Prior Authorization Type Code

    461-EU

    8

    Prior Authorization Number Submitted

    462-EV

    8Ø1

    Days Supply 4Ø5-D5 3
    Quantity Dispensed 442-E7 The submitted amount should not exceed the quantity necessary for a three-day supply according to the directions for administration given by the prescriber. If the medication is a dosage form that prevents a three-day supply from being dispensed (e.g., an inhaler), it is still permissible to indicate that the emergency prescription is a three-day supply, and enter the full quantity dispensed.

    Download the Dispensing 72-hour Emergency Prescriptions Instructions to distribute to staff and display in your pharmacy.

    P-13.1.5. Reconsideration

    The prescribing provider may request reconsideration if the prior authorization request is denied.

    Prescribing providers should contact the Texas Prior Authorization Call Center for the fee-for-service Medicaid prior authorization reconsideration process. Refer to the Medicaid FFS Prior Authorization Requests for the Texas Medicaid Prior Authorization Reconsideration Request (HHS Form 1322).

    Prescribing providers should contact the MCO for its reconsideration process for clients enrolled in managed care.

    P-13.2. CSHCN Services Program

    The CSHCN Services Program requires prior authorization for the following drugs:

    • Cystic Fibrosis products (includes Cayston, Kalydeco, Pulmozyme, and Tobi)
    • Growth Hormone products
    • Synagis

    Refer to the CSHCN Services Program Prior Authorization Requests section for a list of request and addendum forms.

    Prescribing providers must send a letter of medical necessity on office stationery to the CSHCN Service Program for the following drugs:

    • Family planning products
    • Human Immunodeficiency Virus (HIV) drugs
    • Pulmonary hypertension drugs

    Refer to the CSHCN Services Program - Prior Authorization Contacts section for program contact information.

    The program may cover HIV drugs when prior authorized for the treatment of HIV/AIDS, while the person completes the Texas HIV Medication Program eligibility process. Covered HIV medications are subject to change. People have up to 60 days of prior approval while waiting for acceptance or denial from the Texas HIV Program.

    After the 60 days prior approval period, the person must contact the Texas HIV Program to obtain these medications. Claims for these drugs will reject with NCPDP code 75 ("Prior Authorization Required") and include the message “Call HIV Program 1-800-255-1090” in the “Additional Message Information” field (526FQ), except when the person is not eligible for the drug from the HIV Program. In these cases, the CSHCN Services Program should be notified and the claim will process for payment under CSHCN.

    The Texas Department of Insurance requires HHSC to publish the Texas Standardized Prior Authorization Request Form for Health Care Services (TDI Form NOFR002) for prescribing providers as of September 1, 2015. Refer to 1 TAC Section 19.1820 (Prior Authorization Request Form for Prescription Drug Benefits, Required Acceptance, and Use) on the VDP website Rules and Statutes page (txvendordrug.com/about/rules).

    Providers use this form to request prior authorization by fax or mail. Some medications will require providers to submit an addendum form to capture additional information. Failure to submit both the Standardized Prior Authorization Request and addendum may result in an authorization denial. Refer to the CSHCN Services Program Prior Authorization Requests section for a list of addendum forms.

    P-13.2.1. Appeal Information

    Either the person or the prescribing provider may appeal a denial for authorization or payment. Routine adjustments to claims are handled through the HHS Pharmacy Benefits Access Help Desk. Other appeals, administrative reviews, and due process hearing requests for services authorized and paid by CSHCN must be submitted in writing. Refer to the “Children with Special Health Care Needs Services Program” section of the Contacts chapter of the PPPM for program mailing address.

    Failure to submit an appeal, administrative review, or due process hearing request in writing to the program within the deadlines defined below is considered a waiver of the right to appeal, to administrative review, or to due process hearing.

    Claims that are denied must be resubmitted for appeal within 180 days from the date of the initial denial. Claims that are denied on written appeal must be submitted for administrative review within 30 days of the date on the appeal denial letter. A due process hearing must be requested within 20 days of the date on the administrative review denial letter.

    Authorizations that are denied must be submitted for appeal or administrative review within 30 days of the date when authorization of services was denied. All appeal materials, including medical reports, forms, and a medical/financial rationale for appeal must be submitted within the deadline. A due process hearing must be requested within 20 days of the date on the letter denying administrative review.

    14. Pricing and Reimbursement

    1. Drug Pricing

    Reimbursement of outpatient prescription drugs is based on the drug's Actual

    Acquisition Cost (AAC) according to the Covered Outpatient Final Rule of the

    Affordable Care Act of 2010.  Pharmacy providers must use the current Texas Drug Code Index as the reference for allowable package sizes of reimbursable legend and non-legend drugs and are reimbursed at AAC plus a reasonable dispensing fee. AAC is defined as an estimate of prices generally and is currently paid in the market by one of the following:

    1. Wholesale estimated acquisition cost (WEAC);
    2. Long term care pharmacy acquisition cost (LTCPAC); or
    3. Specialty pharmacy acquisition cost (SPAC)

    The AAC is verifiable by invoice audit conducted by HHSC to include necessary supporting documentation verifying the final cost to the provider. The WEAC, LTCPAC, and SPAC prices are established using market or government sources, which include, but are not limited to: 

    • Reported manufacturer pricing
    • First Databank
    • Redbook
    • Weighted Average Manufacturer Price as published by the Centers for Medicare & Medicaid Services (CMS)
    • National Average Drug Acquisition Cost (NADAC), as published by CMS; or
    • Gold Standard pricing service

    Pharmacy providers participating in the 340B Drug Pricing Program must identify all outpatient pharmacy claims filled with 340B stock for 340B-eligible people.  Refer to the 340B Resources chapter of this manual to learn more about billing requirements for eligible pharmacies.

    This methodology applies to the pricing on all claims processed by HHSC beginning June 1, 2016.  Retroactive claims are processed with the pricing on the date of service.  The change is not related to and does not impact reimbursement rates associated with pharmacy reimbursement through Medicaid managed care.

    NADAC pricing is generated by CMS and pricing disputes are directed to CMS.  Refer to the “NADAC Pricing Questions” section of the Contact Information chapter of this manual for pricing contacts.

    2. Ingredient Cost and Reimbursement Methodologies

    Texas Medicaid reimburses contracted pharmacy providers according to the “Pharmacy (Non-DME)” fee schedule. The estimated acquisition cost is defined in the Texas Administrative Code Title 1, Section 355.8541 relating to Legend and Non-legend Medication.

    Ingredient costs may differ by the type of pharmacy and the benchmark for reimbursement is primarily the National Average Drug Acquisition Cost (NADAC), the benchmark of retail pharmacy acquisition costs developed by CMS as previously discussed. HHSC uses a drug’s wholesale acquisition cost (WAC) price when NADAC pricing is unavailable.

    2.1 Retail Pharmacy

    The ingredient cost is equal to the NADAC price, or (WAC minus 2 percent) if NADAC pricing is not available.

    2.2 Long-term Care Pharmacy

    A long-term care (LTC) pharmacy is defined as one for which the total Medicaid claims for prescription drugs to residents of long term care facilities exceeds 50 percent of the pharmacy’s total Medicaid claims per year. Long term care pharmacies are typically not open to the public for walk-in business.

    The ingredient cost is equal to (NADAC minus 2.4 percent), or (WAC minus 3.4 percent) if NADAC pricing is not available.

    2.3 Specialty Pharmacy

    A specialty pharmacy meets all of the following criteria:

    • Processes more than 10% of Medicaid Specialty Claims per year compared to total claims, as described in Section 354.1853 (relating to Specialty Drugs)
    • Obtains volume-based discounts or rebates on specialty drugs from manufacturers or wholesalers; and
    • Dispenses at least 80 percent of filled prescriptions by shipment through the U.S. Postal Service or another common carrier to customers or healthcare professionals (including physicians and home health providers).

    The ingredient cost is equal to (NADAC minus 1.7 percent), or (WAC minus 8 percent) if NADAC pricing is not available.

    3. Professional Dispensing Fees

    Payment for legend drug and non‐legend drug (OTC) prescriptions are reimbursed at the lesser of the following:

    1. AAC plus a reasonable dispensing fee
    2. The Usual and Customary (UAC) price charged the general public
    3. The Gross Amount Due (GAD), if provided

    The reimbursement amount is determined by adding $7.93 (the fixed component) to the ingredient cost and dividing the sum by 0.9804 (the variable component). An additional $0.15 is added if the pharmacy has been certified as providing free delivery service to people enrolled in Medicaid. Another $0.50 is added if the pharmacy dispenses a premium preferred generic.

    Table 1- VDP Reimbursement Calculation

    Value Component

    $7.93

    Fixed component

    0.9804

    Variable component

    $0.15

    Delivery incentive (based on provider file) applied to all legend claims after all calculations are complete. Note: 340B pharmacies do not receive delivery incentive.

    $0.50

    Premium Preferred Generic (PPG) incentive applied to all Medicaid PPG drugs after all calculations are complete. Note: Incentive does not apply to $0.00 total payment amount claims.

    For example, if the ingredient cost of a drug is $10.00, the pharmacy's total reimbursement is calculated in the following way: 

    $10.00 plus $7.93 = $17.93 

    $17.93 divided by 0.9804 = $18.28

    Pharmacies with a delivery agreement add $0.15 = $18.43

    Pharmacies dispensing a premium preferred generic drug add $0.50 = $18.93

    If the submitted UAC or GAD price for this item is less than the amount calculated above, the pharmacy will receive payment for the UAC or GAD price.  Pharmacy staff should submit their true UAC price for all claims.

    The total dispensing fee shall not exceed $200 per prescription.

    • Refer to the Enrollment chapter of this manual to learn about the delivery incentive.  
    • Refer to the Drug Policy chapter of this manual to learn about premium preferred generic drugs.
    • Refer to the 340B Resources chapter of this manual to learn more about requirements for the 340B Drug Pricing Program eligible pharmacies.

    Certain products may differ from this reimbursed calculation, such as home health supplies, vitamin and minerals, influenza vaccines, and long-acting injectables. Refer to the Formulary search, and the Drug Pricing section of the drug details page, for information on specific pricing.

    15. 340B Resources

    1. About 340B Drug Pricing Program

    Section 340B of the Public Health Services Act requires drug manufacturers to provide outpatient drugs to Health Resources Services Administration (HRSA) eligible healthcare organizations or covered entities at significantly reduced prices. This program enables covered entities to purchase drugs at a discounted price and use the remaining funds to provide services to more eligible patients and to provide more comprehensive services. This policy also allows insurers, including Medicaid programs, to share in the savings generated by the 340B Program.  Refer to the "340B Drug Pricing Program" at www.hrsa.gov/opa/.

    1.1 Participation

    To participate in the 340B Drug Pricing Program, eligible healthcare organizations/covered entities must register and be enrolled with the 340B program and comply with all 340B Program requirements.  When HRSA enrolls a covered entity, that organization is assigned a 340B identification number.  Drug manufacturers use this number to verify that organization is allowed to purchase 340B discounted drugs.  Covered entities must designate with HRSA whether 340B discounted drugs will be used to bill Medicaid.

    HRSA does not specify how covered entities should implement the 340B Program. If they comply with all 340B Program requirements, they have flexibility in implementing the 340B Program.

    Most covered entities choose one or more of the following options to provide outpatient drugs to their patients:

    • In-house Pharmacy, in which the covered entity owns drugs, pharmacy and license; purchases drugs; is fiscally responsible for the pharmacy; and pays pharmacy staff.
    • Contract Pharmacy Services, in which the covered entity owns drugs; purchases drugs; pays (or arranges for patients to pay) dispensing fees to one or more contract pharmacies; and contracts with pharmacy to provide pharmacy services.
    • Provider/In-House Dispensing, in which the covered entity owns drugs; employs providers licensed in the state to dispense; holds a license for dispensing for the participating providers; and is fiscally responsible for operating and dispensing costs.

    1.2 Annual HRSA Recertification

    HRSA requires 340B covered entities to annually recertify their eligibility to remain in the 340B Drug Pricing Program and continue purchasing covered outpatient drugs at discounted 340B prices.  When recertifying, please be sure that both the entity’s National Provider Identifier (NPI) and Texas-issued Medicaid vendor number are included in the HRSA database.  If the covered entity is sharing the 340B savings with Medicaid (both fee-for-service and managed care) please ensure that the covered entity has answered 'YES' to the Medicaid Billing question 'Will you bill Medicaid for drugs purchased at 340B prices' and verify that the entity is also listed on the HRSA quarterly 'Medicaid Exclusion' file.

    2. Pharmacy Provider Enrollment

    2.1 Vendor Drug Program 

    The Texas Medicaid Pharmacy Provider Enrollment Application requires applicants to indicate their sources for pharmaceutical products. Covered entities participating in the HRSA 340B Drug Pricing Program are required to identify in the proper field of the application to denote that the entity is eligible to purchase products under through the HRSA 340B program.  Download the Texas Medicaid Pharmacy Provider Enrollment Application to enroll with VDP.

    Once contracted, it is the responsibility of the covered entity to ensure the information submitted in their application remains current, including the names of pharmacists working at the pharmacy.  Refer to the "Pharmacy Enrollment and Support" section of the Contact Information chapter of the PPPM for submitting updates to the original application.

    2.2 Texas Medicaid and Healthcare Partnership

    Providers cannot be enrolled in Texas Medicaid if their licenses are due to expire within 30 days. Generally, to be eligible to participate in Texas Medicaid, a provider must:

    • Enroll in Medicare.
    • Complete the TMHP enrollment process by submitting a paper Texas Medicaid Enrollment Application or by submitting an electronic application via the Online Provider Enrollment Portal (PEP).  
    • Submit a signed Texas HHS Medicaid Provider Agreement.
    • Pay an application fee as required of institutional providers (42 CFR Section 455.460). 
    • List all the Texas-issued Medicaid vendor number(s) and NPIs with HRSA and make their Medicaid exclusion known.

    Refer to the "Texas Medicaid and Healthcare Partnership" section of the Contact Information chapter of the PPPM for provider enrollment information.

    3. Pharmacy Claim Submission

    3.1 Pharmacy Claims

    Pharmacies of eligible entities participating in the 340B Drug Pricing Program must identify all outpatient pharmacy claims filled with 340B stock for 340B-eligible people in all programs by submitting a value of "2Ø" ("34ØB / Disproportionate Share Pricing/Public Health Service") in the "Submission Clarification Code" field (42Ø-DK).

    3.2 Contracted Pharmacies

    Many 340B covered entities elect to dispense 340B drugs to patients through contract pharmacy services, an arrangement in which the 340B covered entity signs a contract with a pharmacy to provide these prescription services.  A covered entity that wishes to utilize contract pharmacy services to dispense section 340B outpatient drugs must have a written contract in place between itself and a specified pharmacy or pharmacies. A single covered entity that has more than one 340B eligible site at which it provides health care may have individual contracts for each such site or include multiple sites within a single pharmacy services contract.  All contracted pharmacies must be listed in the HRSA’s Office of Pharmacy Affairs (OPA) Contracted Pharmacies Database, associated with the covered entity.  The covered entity is responsible for compliance of their contract pharmacy arrangement(s) and must maintain ownership of the 340B drugs.

    A “ship to, bill to” procedure can be used by which the covered entity purchases the drug; the manufacturer/wholesaler bills the covered entity for the drug that it purchased and ships the drug directly to the contract pharmacy.

    3.2.1 Guidelines for Contract Pharmacy Services

    Guidelines that govern the operation and compliance of contract pharmacies can be found at “Notice Regarding 340B Drug Pricing Program — Contract Pharmacy Services, Final Notice (PDF)." Federal Register 75 (March 5, 2010): 10272-10279. 

    3.2.2 Responsibilities

    Covered entities are responsible for ensuring compliance of their contract pharmacy arrangement(s) with all 340B Program requirements to prevent diversion and duplicate discounts.

    3.2.3  HRSA Audit Requirements

    All covered entities are required to maintain auditable records and are expected to conduct annual audits of contract pharmacies performed by an independent outside auditor to fulfill their ongoing obligation of compliance.  To the extent that any compliance activity or audit performed by a covered entity indicates that there has been a violation of 340B Program requirements, such finding should be disclosed to HRSA along with the covered entity's plan to address the violation.

    3.3 Claims Submission from a Contract Pharmacy

    A pharmacy may not know at point-of-sale if a claim qualifies as a 340B claim.  At the point the pharmacy is notified or discovers that the claim qualifies as a 340B claim, the original claim must be reversed and the claim resubmitted as a 340B claim with the correct “Submission Clarification Code” value (refer to Pharmacy Claim Submission, section 3 above).  If the claim has not been corrected to include the correct "Submission Clarification Code" value, the pharmacy and the eligible entity are at risk for duplicate discounts.

    4. Pharmacy Reimbursement

    4.1 Fee-For-Service Medicaid, CSHCN, HTW, and KHC

    Effective June 1, 2016, the reimbursement methodology for calculating the ingredient cost of pharmacy claims paid to eligible health care organizations is based on the Wholesale Acquisition Cost (WAC):

    • Human Immunodeficiency Virus (HIV) products: WAC minus 40 percent
    • Hemophilia products: WAC minus 32 percent
    • Brands and generics: WAC minus 57 percent

    New drugs are added to the formulary at WAC minus 23.1 percent for 6 months. 

    This methodology is not all inclusive and some products may be priced manually. 

    4.2 Medicaid Managed Care 

    Medicaid managed care organizations (MCO) implemented their own 340B reimbursement methodologies on December 1, 2014.  Pharmacy staff should contact the MCO in question for specific processes.  Refer to the "Managed Care" section of the Contact Information chapter of the PPPM for contacting the specific MCO.

    Medicaid managed care organizations have been notified of the eligible entity's requirement to submit a value of “2Ø” in the “Submission Clarification Code” field (42Ø-DK) for pharmacy claims to denote claims filled with stock purchased through the 340B program.

    • A 340B covered entity seeking to use 340B stock in Medicaid managed care must contract with the MCO as a 340B pharmacy and accept the payment terms of their "shared-savings" model:
    • If the 340B covered entity does not accept the terms of an MCO's shared savings model for the reimbursement of 340B-purchased drugs, then the covered entity may choose to contract with the MCO as a retail pharmacy.
    • If the covered entity contracts with an MCO as a retail pharmacy, the entity cannot use 340B purchased drugs.
    • If a pharmacy is not contracted as a 340B pharmacy in their network, MCOs may deny claims submitted with a value of “2Ø” in the “Submission Clarification Code” field (42Ø-DK) as the pharmacy should not have utilized 340B stock.

    An MCO cannot require one of its network pharmacy providers to submit its actual acquisition cost (AAC) on outpatient drugs and biological products purchased through the 340B program, consistent with UMCM Chapter 2.2, “Pharmacy Claims Manual.” 

    5. Clinician-administered Drug Claim Submission

    Beginning September 1, 2015, all eligible organizations and covered entities that are enrolled in the federal 340B Drug Pricing Program to purchase 340B discounted drugs must use modifier “U8” when submitting claims for 340B clinician-administered drugs. Non-compliance with this requirement may jeopardize a covered entity’s 340B status with HRSA. This modifier requirement for 340B clinician-administered drugs applies for Medicaid fee-for-service claims submitted to TMHP and Medicaid managed care claims submitted to the patient’s managed care organization.

    It is the responsibility of the covered entity to correctly submit claims filled with 340B stock for 340B-eligible patients to ensure rebates are not collected for these drugs.

    For all clinician-administered drug claims, all Texas Medicaid providers must submit a rebate-eligible National Drug Code (NDC) and modifier “U8” for professional or outpatient claims, including Medicare crossover claims submitted to TMHP, with a clinician-administered drug-related Healthcare Common Procedure Coding System (HCPCS).  Texas Medicaid defines clinician-administered drugs as physician-administered drugs for procedure codes listed on the Texas NDC-to-HCPCS Crosswalk.

    The NDC is an 11-digit number on the package or container from which the medication is administered. Providers must enter modifier “N4” in front of the NDC code on all claim forms. The "NDC Quantity" and the "NDC Unit of Measure" must be entered on all professional or outpatient claims that are submitted to TMHP. TMHP edits medical claims against the crosswalk, which identifies relationships between rebate-eligible NDC and HCPCS codes. All claims with a HCPCS code listed on the crosswalk require a corresponding NDC.

    Refer to the Clinician-administered Drug Search for a list of CAD drugs.

    If a provider believes that NDCs are missing for a specific HCPCS procedure code, the provider can submit an email to vdp-cad@hhsc.state.tx.us requesting an update to the crosswalk. The email should include the procedure code(s) and corresponding NDCs that are believed to be missing.

    For more information related to submission of medical claims, call the TMHP Contact Center at 1-800-925-9126.

    6. Drug Rebates

    All outpatient pharmacy and clinician-administered drug claims for all stateadministered drug rebate programs are sent to the VDP Drug Rebate System for invoicing.

    VDP invoices drug manufacturers for all claims, not excluded because of the 340B program, where the state has paid any amount of money, including co-pay, coinsurance, or any other payment type.  Claims or amounts paid for dual eligible patients, either directly by the state or through a Medicaid MCO, are also invoiced.

    6.1 Pharmacy Rebates

    Outpatient pharmacy drug claims submitted with a date of service on or after January 1, 2014, will only be excluded from the drug rebate system invoicing process if they are submitted with a “2Ø” in Submission Clarification Code (Field 42Ø-DK).  It is the responsibility of the covered entity and their contracted pharmacies to correctly report claims filled with 340B stock for 340B-eligible patients to ensure rebates are not collected for these drugs.

    6.2 Clinician-Administered Drug Rebates

    For outpatient clinician-administered drug claims, Texas HHS uses the modifier “U8” on claims and encounters, as well as HRSA’s Office of Pharmacy Affairs (OPA) Medicaid Exclusion file to identify Texas providers that have been added or deleted. Refer to the "Medicaid Exclusion File" page on the federal HHS website.

    For claims and encounters with a paid date on or after April 1, 2017, only medical claims and encounters with the U8 in the modifier field will be excluded from Texas HHS’s rebate invoicing.  Texas invoices drug manufacturers for all other claims where the state has paid any amount of money, including co-pays, co-insurance, capitated rates, or any other payment type.  Claims or amounts paid for people that are dual eligible, either directly by the state or through a Medicaid managed care health plan, are also invoiced.

    7. Responsibilities

    Covered entities/contracted pharmacies:

    • Correctly reporting claims filled with 340B stock for 340B-eligible patients to ensure rebates are not collected for these drugs
    • Working with the drug manufacturer to resolve disputes when either traditional or managed care claims are not indicated appropriately with SCC “20” or “U8” modifiers and HHSC invoices for rebates MCOs and pharmacy benefit managers:
    • Maintain shared-savings model
    • Passing the submission clarification code “20” or “U8” modifier in encounter data to HHSC
    • It is not their responsibility to oversee covered entities or the contracted pharmacy to ensure rebates are not collected.

    HHSC does not approve alternative arrangements for preventing duplicate discounts. The automated drug rebate system relies on the submitted code or modifier to identify claims excluded from the rebate invoicing process.

    16. Payment

    16.1. Pharmacy Payment

    The Vendor Drug Program pays pharmacies enrolled with HHSC for dispensed outpatient pharmaceuticals for people enrolled in:

    • Traditional Medicaid
    • Children with Special Health Care Needs (CSHCN) Services Program
    • Healthy Texas Women (HTW) program
    • Kidney Health Care (KHC) Program

    Claims for people enrolled in Medicaid managed care or the Children’s Health Insurance Program (CHIP) are billed through the managed care organization (MCO) and its contracted pharmacy benefits manager.  Questions regarding remittance of these claims should be addressed to the MCO.  Refer to the Managed Care chapter of this manual to contact the MCOs in your area.

    16.2. Provider Payment Algorithms

    The VDP Pharmacy Claims System considers the fields identified in this section during the claim adjudication process.

    16.2.1 Usual and Customary

    The "Usual and Customary" (UAC) field (426-DQ) captures the amount requested for reimbursement. The usual and customary price is the price most frequently charged to the general public for the same drug.

    • Refer to 1 TAC Section 355.8544 (Usual and Customary Prices) on the Texas Administrative Code page.
    • Any person whose prescription is not paid for by a third-party payor, such as a health insurer, governmental entity, or Texas Medicaid, is a member of the general public.
    • Pharmacies cannot exclude discount prices given to customers from its determination of the most frequently charged price for the same drug when reporting the UAC price to Texas Medicaid on a claim transaction.  If a discount price is advertised for a drug then the discount price must be reported to Texas Medicaid as the UAC price for the same drug, unless the most frequently charged price is lower.
    • “Opt-in” requirements to obtain discount prices (such as requiring the customer to possess or present a special identification card or to make a request for a discount) do not exclude a person from the general public for purposes of determining the UAC price to report to Texas Medicaid.  

    Claims submitted with an UAC value greater than or equal to $10,000 will reject with NCPDP code “DQ” (“M/I Usual and Customary Charge”), and the dispensing pharmacy must contact VDP for an override.  Refer to the "Vendor Drug Program Correspondence" section of the Contact Information chapter of this manual on how to contact the Pharmacy Benefits Access Help Desk.

    Refer to the Enrollment chapter of this manual for information on reporting the UAC price for pharmacy discount membership programs and third-party discount plans.

    16.2.1.1 Most Frequent Price Determination

    Texas HHS requires pharmacies to determine the price the pharmacy most frequently charges for the same drug, which means the pharmacy is required to consider past-pricing data in actual transactions with uninsured customers to determine the most frequent (or mode) price for the same drug. The median price is used if a most frequent price cannot be determined.

    A given drug is the same drug whether it is dispensed in a single unit or in multiple units, and Texas HHS requires a pharmacy to consider all transactions for the same drug as the Medicaid claim when determining the most frequent price, regardless of the quantity dispensed.  To determine the most frequent price for the same drug across transactions with multiple different dispensed quantities, a pharmacy should:

    1. Calculate the unit price for each uninsured transaction for the same drug
    2. Determine the most frequent unit price for the same drug in its uninsured transactions.
    3. Multiply the most frequent unit price for the drug by the quantity of the same drug being dispensed in the Texas Medicaid claim.

    The result will be the UAC price, (unless an advertised discount price for the same drug would be lower).  

    1 TAC Section 355.8544 is silent regarding the time period of actual transactions in past-pricing data before the Texas Medicaid claim a pharmacy should consider when determining the most frequent price.  Accordingly, a reasonable time period should be used.  To be reasonable, the period must be of sufficient duration to be likely to capture multiple uninsured transactions for each drug in the portfolio of drugs dispensed by the pharmacy during the period.  Texas HHS presumes a period between thirty (30) to ninety (90) days would be reasonable.  A period only considering uninsured transactions on the same day as the Medicaid claim would not be reasonable, because it would render the frequency determination meaningless.  To be reasonable, the period a chain pharmacy uses to calculate the most frequent price at a single pharmacy location in Texas would likely need to be longer than if the chain considered past pricing data across multiple Texas pharmacy locations within the chain. 

    16.2.2. Gross Amount Due 

    The "Gross Amount Due" (GAD) field (430-DU) reflects the pharmacy's usual and customary price less discount or special price.

    Claims submitted with a GAD value greater than or equal to $10,000 will reject with NCPDP code “DU” (“M/I Gross Amount Due”), and the dispensing pharmacy must contact VDP for an override.  Refer to the "Vendor Drug Program Correspondence" section of the Contact Information chapter of this manual on how to contact the Pharmacy Benefits Access Help Desk.

    16.2.3. Basis of Cost Determination

    The value submitted in the "Basis of Cost Determination" field (423-DN) indicates the methodology the price submitted in the "Ingredient Cost Submitted" field (409D9) was calculated.  The system accepts the values in Table 1 and any other submitted value will reject with NCPDP code “DN” (“M/I Basis of Cost Determination”).

    Value Definition Note

    ØØ

    Default

    Will default to Direct.

    Ø1

    AWP (Average Wholesale Price)

     

    Ø3

    Direct

     

    Ø8

    340B / Disproportionate

    Share Pricing/Public Health Service

    For Public Health Service pharmacies only.  Refer to the 340B Resources chapter of this manual.

     Ø9    Other For claims with drugs purchased from a central purchasing entity or a warehouse.

    16.2.4. Submission Clarification Code

    Pharmacies eligible to participate in the 340B Drug Pricing Program must identify all outpatient pharmacy claims filled with 340B stock for 340B-eligible people by submitting the value of "2Ø " (340B / Disproportionate Share Pricing/Public Health Service) in the "Submission Clarification Code" field (420-DK). Refer to the 340B Resources section to learn more about billing requirements for eligible pharmacies.

    16.3. Provider Payment Calculation

    The fields shown in the table, including “Basis of Reimbursement Determination” field (522-FM), are returned on the paid claim response. Refer to the “NCPDP B1 Transaction Paid Response” payer sheet for specific transaction, segment, and field requirements.

    Field Name Field Number

    Patient Pay Amount

    5Ø5-F5

    Ingredient Cost Paid

    5Ø6-F6

    Dispensing Fee Paid

    5Ø7-F7

    Incentive Amount Paid

    521-FL

    Professional Service Fee Paid

    562-J1

    Other Payer Amount Recognized

    566-J5

    Total Amount Paid

    5Ø9-F9

    Basis of Reimbursement Determination

    522-FM

    16.4. Payment Cycle

    All payable Medicaid, CSHCN, HTW, and KHC claims are paid weekly. The payment cycle begins at 12:00:00 a.m. on Friday and ends at 11:59:59 p.m. the following Thursday. Payments are generally issued to financial institutions on Monday night and are posted to each pharmacy's account according to its financial institution's schedule (usually within 72 hours).

    Federal holidays may impact payment. Refer to the Payment Delays section for more information.

    Payments for claims from all programs will appear on the same payment warrant, direct deposit, and remittance advice.

    16.5. Weekly Payment Files

    Pharmacy providers receive the following files each week:

    • Standard ASC X12N 835 Health Care Payment/Advice
    • VDP payment register in portable document format (PDF)

    The files identify paid or reversed claims.  Pharmacy staff should examine each document and maintain documents for future reference.  Payment files are not mailed, and pharmacy staff must obtain the files from the VDP Payment File Portal (PFP).

    16.5.1 VDP Payment File Portal

    The Pharmacy Payment File Portal (PFP) (https://moveit.services.conduent.com/) is a browser-based portal pharmacy staff use to obtain pharmacy remittance advice files.  All Medicaid-enrolled pharmacy providers are eligible to create a free account. The PFP is accessible only through the Microsoft® Internet Explorer® browser.

    Download the Pharmacy Electronic Remittance Advice Agreement (HHSC Form 1316) to set up your account. Third-party entities accessing payment information on behalf of pharmacy staff must also complete the form. Changes, terminations and addition of providers for third party entities must be reported by submitting an updated form.

    Refer to the Pharmacy Payment section of the Contact Information chapter for PFP Correspondence.

    16.5.2. State Comptroller

    Pharmacies may view their payment information through an account with the Texas Comptroller of Public Accounts. Refer to the State Payee Payment Resources page of the Comptroller's website to learn more.

    16.6. Payment Delays

    There will be a one-day delay in traditional Medicaid, CSHCN Services Program, and KHC Program payments because of the following federal holidays occurring on Monday:

    • Martin Luther King, Jr. Day (third Monday of Jan.)
    • Presidents Day (third Monday of Feb.)
    • Memorial Day (last Monday of May)
    • Labor Day (first Monday of Sept.)
    • Columbus Day (second Monday of Oct.)

    There will also be a one-day delay in payment when the following holidays occur on Monday:

    • New Year’s Day (Jan. 1)
    • Independence Day (July 4)
    • Veterans Day (Nov. 11)
    • Christmas Day (Dec. 25)
    • Day After Christmas (Dec. 26)

    Any other unscheduled delay is announced on the VDP website.  

    16.7. Refunds

    Claims billed incorrectly, resulting in the pharmacy provider owing VDP a refund, should be adjusted or recouped within 90 days of the original date of service.

    Pharmacy staff should first attempt to reverse the claim. Pharmacies have 720 days from the date of service to reverse the claim online.  

    If pharmacy staff are unable to reverse the claim, then they should contact the Pharmacy Benefits Access Help Desk.  Help desk staff can reverse claims through the current triennium, or the current fiscal year plus two previous fiscal years.

    Claims outside the current triennium cannot be adjusted electronically and must be refunded to the state by check or money order.  A cover letter including individual claim-level detail is required with the refund. The pharmacy's six-digit Vendor Drug contract ID number and 10-digit NPI must be displayed on both the documentation and the check/money order to expedite the refund.

    Refer to the Pharmacy Refunds section of the Contact Information chapter for instruction on how to submit refunds to HHSC.  Pharmacy staff should not send checks to the VDP claims processor, Conduent-Pharmacy.

    17. Audits

    17.1. Pharmacy Audits

    All pharmacies enrolled with Texas HHS are subject to periodic audits. These may result from internal Texas HHS auditors working with the Texas HHS Inspector General (IG) or Federal Medicaid Integrity contractors working through the Centers for Medicare and Medicaid Services.

    Refer to 1 TAC Section 354.1891 (Vendor Drug Providers Subject to Audit) on the "Texas Administrative Code" page for more information.

    Pharmacy claims are sampled and reviewed for accuracy and compliance with state and federal laws and policies governing the pharmacy programs. Any audit findings derived by following procedures developed from accepted and approved audit standards may subject the pharmacy to recoupment. The auditors determine the amount of overpayment in a sample set of claims and then apply a statistical extrapolation formula to estimate the overpayment across the universe of claims the pharmacy provider or supplier submitted over the selected audit period.

    Audits determine the pharmacy's compliance with federal and state laws, policies, procedures, and limitations. Auditors will select claims transactions and compare them with documentation on the corresponding prescriptions, invoices, the pharmacy's daily logs, pharmacy delivery logs, etc. Overpayments are considered exceptions subject to restitution to Texas HHS.

    17.2. Audit Process

    The audit process begins with an engagement letter, or notice of intent to audit, sent to the pharmacy provider. The letter includes the dates of the audit period and the proposed audit date. A request is made that pharmacy staff provide ample room and proper atmosphere for the auditor to conduct the audit. On-site audit time periods vary between 1 and 3 days. At the end of examination of material relevant to the audit, an oral exit interview is conducted.

    The auditors then deliver the draft audit report listing findings, if any, to the pharmacy contact - usually the owner or the pharmacist-in-charge. The pharmacy then has 15 days to provide additional documentation and a response to the draft audit report. The response may include a management rebuttal to address any findings. A final audit report will be issued.

    17.3. Informal Appeals

    A pharmacy has a right to request an informal hearing to contest the findings of an audit conducted by the HHSC IG or an entity that contracts with the federal government to audit Medicaid pharmacy providers. The informal hearing can be requested if the audit findings do not include findings that the pharmacy engaged in Medicaid fraud. In an informal hearing, an Administrative Law Judge (ALJ) from the HHSC Appeals Division will make the final decision on whether the complete findings of an audit, including any additional documentation provided, are accurate.

    Refer to 1 TAC Section 354.1891 - Vendor Drug Providers Subject to Audit for more information.

    3.1 Appeals Process

    Pharmacy providers will have 15 days from receipt of the final audit report to request an informal hearing. Pharmacy staff will be notified via certified mail that the informal hearing has been scheduled. The notice is mailed to the pharmacy's address on file with the VDP or to the attorney representing the pharmacy. The date, time, and location of the hearing and any other pertinent details will be provided.

    If the informal hearing request was not received within 15 days of the receipt of the final performance audit report, pharmacy providers will be notified via letter that the request was not submitted timely and that an informal hearing will not be scheduled.

    If pharmacy staff are is unable to attend the scheduled hearing then the ALJ must be notified in advance. The ALJ determines if the provider's reasons for absence are acceptable. The hearing is rescheduled if the ALJ deems the provider's absence reasons acceptable and the notification process described above will begin again.

    The ALJ will make the final decision. VDP staff will be available to address questions but will not vote on the matter.

    3.2 Informal Hearings

    Informal hearings will be recorded. The pharmacy provider is notified in advance of the hearing date, time and location and that they may request a copy of the recording free of charge.

    A certified letter is sent to the pharmacy provider or to the attorney representing the pharmacy provider indicating the final amount due. The pharmacy provider has 30 days to either:

    • Pay the amount in full; or
    • Request and have an approved payment plan.

    18. Drug Rebates

    18.1. Rebate Administration

    The Medicaid Drug Rebate Program is a partnership between the Centers for Medicare & Medicaid Services (CMS), state Medicaid agencies, and participating drug manufacturers working together to offset the federal and state costs of outpatient prescription drugs dispensed to Medicaid patients. Approximately 600 manufacturers currently participate in this program.

    VDP receives federal funds for prescription claims on drugs made by manufacturers participating in the Medicaid Drug Rebate program. Manufacturers agree to pay rebates according to their state and federal contracts in return for having drugs covered by Texas Medicaid.

    18.2. Desk Reviews and Disputes

    Each calendar quarter, the VDP rebate administration staff summarize all paid claims by drug and bill the drug companies for their products. The manufacturer pays the invoice but may have questions about the reported utilization. If this occurs, the rebate administrator staff will review the claim level data for the specific drug.

    Rebate administration staff will direct questions about managed care claims to the MCO for resolution.

    18.2.1. Pharmacy Claims

    If a manufacturer disputes a claim, the rebate administration staff will contact either VDP or the dispensing pharmacy for clarification of claims paid by HHSC, or refer the dispute to the MCO. 

    If the pharmacy has made an error, and the service date of the claim is within the 90-day filing period, the pharmacy can reverse the original claim and resubmit the corrected data. If the claim is outside the 90 days, the rebate administration staff will instruct VDP or MCO staff how to correct the claim.

    Common dispute reasons include:

    • Omission of a decimal point 
    • The quantity claimed does not match the package size (e.g., 14.5-grams claimed and the NDC is for a 17-gram inhaler)
    • Excess quantity, the result of a valid keying error, or the pharmacy billed the claim using the wrong unit of measure (e.g., entered a quantity of 300 and the price is for 30)
    • Low reimbursement, the result of keying errors or billing the wrong unit of measure

    Pharmacy staff should ensure the units submitted are accurate for the claim and product.  Any pharmacy eligible for discounts through the Health Resources and Services Administration 340B designation should submit claims with appropriate modifiers.

    18.2.2 Clinician-Administered Claims

    The manufacturer will dispute a claim in the following situations:

    • Omission of the decimal point
    • The provider rounds the quantity up to the following whole number
    • The provider does not enter the number of units administered based on the Healthcare Common Procedure Coding System (HCPCS) description and conversion factor.

     If a manufacturer disputes a claim, the rebate administrator staff will contact VDP for clarification.

    Common dispute reasons include:

    • The quantity administered was not reported correctly. This is most common if the HCPCS description is for more than 1.  For example, the description for HCPCS code J1885 is "Injection, ketorolac tromethamine, per 15 mg", therefore 15 mg equals 1 HCPCS unit. If 15 mg is administered, then the correct number of HCPCS units to claim is 1, not 15. Likewise, if 30 mg is administered, the number of units claimed would be 2. The number of HCPCS must then be converted to reflect the correct units for the NDC used.
    • Low reimbursement is received for the quantity of services provided or the amount claimed.
    • A missing or invalid NDC on the claim

    19. Documents and Forms

    P-19.1. Documents

    P19.1.2. Education

    Refer to the Downloadable Materials section for more information about these documents.

    Dispensing 72-hour Emergency Prescriptions Instructions

    Mosquito Repellent Benefit Information

    Pharmacy Resources for Managed Care Information

    Real-time Eligibility Verification Information

    P-19.2. Forms

    VDP uses forms for pharmacy enrollment, registering for special system access, requesting prior authorization for drugs, and conducting other business. Refer to the pages in this section for lists of forms by topic.  Each form has unique completion and submission instructions.

    Refer to the File Viewing Information (hhs.texas.gov/file-viewing-information) if you have difficulties viewing or downloading forms.

    P-19.2.1. Enrollment

    Pharmacy Enrollment Application

    Pharmacy Enrollment Agreement

    Application for Payee Identification Number

    Direct Deposit Authorization

    Pharmacy Electronic Remittance Advice Agreement

    Pharmacy Eligibility Verification Portal Access

    Pharmacy Ownership Transfer Affidavit

    CCP Prior Authorization Request Form

    Home Health Services (Title XIX) DME/Medical Supplies Physician Order Form

    P-19.2.2. Claim Processing

    P-19.2.2.1. Pharmacy Claims Billing Request

    The Pharmacy Claims Billing Request is the only acceptable paper form. Paper claim submission is permissible for the following cases:

    • Newborns when a Medicaid cardholder ID number has yet to be issued.
    • Special circumstances as defined by HHSC (e.g. natural disasters).

    All other types of paper forms, and any form submitted for an unapproved reason, are not accepted and will be returned with no action taken. The “Submission Explanation” field is required and identifies why the form is being submitted. Pharmacy staff must sign and date the form prior to submitting to VDP by mail. The form is kept for five years after the end of the federal fiscal year in which the pharmacy provider submits the form.

    Refer to the mailing address in the VDP Correspondence section to submit the form.

    Pharmacy Claims Billing Request

    P-19.2.2.2. Pharmacy Claims Billing Request Instructions

    Pharmacy staff should complete the fields on the form using the NCPDP standard values when applicable. Refer to the VDP website "Pharmacy Payer Sheets" page to review the values on the Claim Billing Transaction (B1) payer sheet.

    Field Usage

    Submission Explanation

    Enter the type of claim submittal or adjustment and reason must be stated in the explanation line before the claim will be processed by HHSC.

    Date Submitted

    Enter the date the form is being submitted to HHSC.

    Pharmacy Name

    Enter the name of pharmacy.

    NPI

    Enter the 10-digit National Provider Identifier number.

    Vendor ID

    Enter the 6-digit vendor ID number.

    Pharmacy Phone

    Enter the pharmacy phone number (plus area code).

    Pharmacy Fax

    Enter the pharmacy fax number (plus area code).

    Cardholder ID 

    Enter person’s program-specific identification number.

    • If the claim is for a newborn and no Cardholder ID number is available, this field should be left blank. Do not enter the mother’s ID number.

    Date of Birth

    Enter person’s date of birth.

    Gender

    Enter using standard NCPDP values.

    Date of Service

    Enter the date the prescription was filled.

    Date RX Written

    Enter the date prescription was written.

    Product ID

    Enter 11-digit National Drug Code.

    Quantity Dispensed

    Enter the quantity dispensed expressed in metric decimal units.

    Units

    Enter using standard NCPDP values.

    Days Supply

    Enter estimated duration of the prescription supply in days.  Refer to Maximum Days Supply By Program.

    Quantity Prescribed

    Enter quantity prescribed expressed in metric decimal units.

    RX Number

    Enter prescription/service reference number.

    Prescription (Rx) Origin Code

    Enter using standard NCPDP values.

    Refill Authorization

    Enter ØØ through 11.

    Refill Number Enter “ØØ” to identify original prescription. 

     

    Enter value between “01” and “11” to identify refill.

    Dispense as Written

    Enter “1” to override the MAC when a physician wants a brand name dispensed and hand writes the phrase "Brand Necessary," "Brand Medically Necessary," "Brand Name Necessary," or "Brand Name Medically Necessary" across the face of the prescription.

    Prescriber ID Enter 10-digit Prescriber NPI.

    Prior Authorization Type

    Enter if prior authorization number submitted is transmitted.  Follow VDP-accepted values.

    Prior Authorization Number

    Enter if prior authorization type code is transmitted.  Follow VDP-accepted values.

    Other Coverage Code

    Required if Coordination of Benefits (COB) segment is submitted.  Enter using standard NCPDP values.

    Usual and Customary Charge

    Enter usual and customary cost (amount claimed for reimbursement).

    Gross Amount Due

    Enter gross amount due.

    Patient Paid Amount Submitted

    Not used.

    Basis of Cost Determination

    Enter using standard NCPDP values.

    Submission Clarification Code Count

    Enter using standard NCPDP values.

    Submission Clarification Code

    Enter using standard NCPDP values.  Repeating field.

    Coverage Type

    Enter using standard NCPDP values.

    Other Payer ID Qualifier

    Enter using standard NCPDP values.

    Other Payer ID

    Enter ID assigned to other payer.

    Other Payer Date

    Enter payment or rejection date of the claim submitted to other payer.

    Other Payer Amount Paid Qualifier

    Enter code qualifying the Other Payer Amount Paid.  Repeating field.

    Other Payer Amount Paid

    Amount of any payment known by the pharmacy from other sources.  Repeating field.

    Other Payer Reject Code

    Enter using standard NCPDP values.

    Amount Paid

    HHSC use only.

    Paid Date HHSC use only.

    P-19.2.3. Formulary Management

    P-19.2.5. Medicaid FFS Prior Authorization Requests

    The forms in this section are used for prescribing providers to request prior authorization for clients enrolled in Medicaid fee-for-service. Refer to the Prior Authorization chapter for general criteria information. Refer to each form's instruction page for requirements and submission instructions.

    Antiviral Agents for Hepatitis C Virus - Initial Request

    Antiviral Agents for Hepatitis C Virus - Initial Request - Addendum

    Cystic Fibrosis Agents (Kalydeco/Orkambi/Symdeko) - Addendum

    Emflaza - Addendum

    Increlex - Addendum

    Makena - Request

    Makena - Addendum

    OxyContin - Addendum

    PCSK9 Inhibitors - Request

    PCSK9 Inhibitors - Addendum

    Phosphate Binders - Addendum

    Synagis - Addendum

    Xenical - Request

    Xenical - Addendum

    Xyrem - Addendum

    Medicaid Prior Authorization Reconsideration Request

    P-19.2.6. CSHCN Prior Authorization Requests

    Prescribing providers submit the following forms to request prior authorization for clients enrolled in the CSHCN Services Program. Refer to the Prior Authorization section for general criteria information. Refer to each form's instruction page for requirements and submission instructions. Refer to the CSHCN Services Program - Prior Authorization Contacts section for program contact information.

    Cystic Fibrosis Treatment Products

    Growth Hormone Products

    Growth Hormone Agents - Addendum

    Synagis - Addendum