Effective October 2010, EPIC Restricts Coverage of Prescription Drugs That are Not on the Medicare Part D Plan Formulary

Under New York State Legislation effective October 1, 2010, there are important changes in the EPIC program, which provides prescription drug coverage for low and middle income New Yorkers over age 65.   Under budget cuts enacted earlier in 2010, if a Medicare Part D plan refuses to cover a drug for an EPIC member because it is not on the Part D plan's formulary, EPIC will no longer automatically pay for the drug, as it has done since Part D started in 2006.   This has been known as the EPIC "wrap-around" for Part D.   Beginning on that date, EPIC will only pay for an off-formulary drug after the member has filed an initial coverage request with the Part D plan, and then has exhausted two levels of appeals that are available under Part D.  

EPIC will provide up to a 90 day temporary supply of a non-formulary drug, but only if the prescriber (member’s physician) contacts EPIC and agrees to cooperate with pursuing a “coverage request” and appeal from the plan. 

The goal of these changes is to save the State money by preventing Part D plans from shifting costs to EPIC. Before, EPIC automatically covered any drug that a Part D plan refused to cover. Many times, the Part D plan was wrong to deny the drug, but was not forced to pay if the member did not appeal.   The EPIC program internally appealed many of these denials, winning back over $7 million dollars in reimbursement for the EPIC program.  However, the State decided that the cost  to the State was too great, and enacted the changes to encourage EPIC members to enlist their physicians either to change their prescription to a drug covered by the Part D plan, or to file an appeal and force the Part D plan to pay.

WARNING - EVEN MORE DRASTIC CHANGES IN EPIC WILL TAKE EFFECT JAN. 1, 2012.  For more about these changes see  this article and this article. 

What will EPIC still cover to supplement Medicare Part D?

EPIC will still continue to cover (note - only through end of 2011)

• drugs EXCLUDED by Medicare Part D altogether -- benzodiazapenes, barbiturates, etc.  These are entire classes of drugs not covered by  Medicare Part D (though national health reform law will require that Part D plans cover benzodiazapenes and barbiturates for treatment of epilepsy, cancer, or a chronic mental disorder in 2013) .   See Selfhelp outline for more info.  

• drugs that are covered by the Part D plan, but the member is not eligible for Part D coverage at that particular time because she is in the deductible period, or in the "coverage gap" or "doughnut hole."  

• part of the cost of the Part D premium and co-insurance, as explained further in this article on EPIC. 

The new law restricts EPIC paying for drugs that are in a class that is covered by Medicare Part D, but  where the particular drug, generally a costly brand name drug, is not on the plan's formulary.  For information on the federal requirements for what drugs must be on a plan formulary see Selfhelp outline.

Here’s how it works when a Part D plan refuses to cover an EPIC member's drug because it is not on the plan formulary, as of October 2010:

• The  doctor prescribes a drug for a patient who has both EPIC and Part D drug coverage. This drug happens to be a Part D covered drug (i.e., not “excluded”), but it is not on the formulary of the patient’s Part D plan.

• Patient goes to the pharmacy and cannot get prescription filled. Pharmacist attempts to bill Part D as primary, and discovers that the drug is off-formulary. Pharmacist is now required to call the doctor, and ask the doctor to consider prescribing an alternative drug that is covered by the Part D plan’s formulary.

  • Note:  If the reason the plan doesn't cover the drug is because the patient is in the Part D plan deductible period, or "doughnut hole," but the Part D plan would otherwise cover the drug, then EPIC will pay for the drug.  

• If the pharmacist reaches the doctor, and the doctor agrees to prescribe an on-formulary alternative, then the pharmacist will bill Part D as primary, and EPIC will wrap around the co-payment as usual, as explained in this article.    This is the probable outcome in many cases - for the doctor to prescribe an alternate drug covered by the plan. 

• If the pharmacist reaches the doctor, and the doctor determines there is no suitable alternative drug,

  • The doctor  must call EPIC’s Temporary Coverage Request (TCR) Helpline -- 1-800-634-1340 --which will go into effect October 1, 2010 --and respond to several questions, creating a “temporary override” in the claims system which will allow for up to a 90 day supply of the prescribed medication to be dispensed. (e.g., 90 day prescription gets 90 day supply, a 30 day prescription gets a 30 day supply and up to two refills).

  • TCR Helpline questions will require the doctor to register his/her intent to initiate an appeal. This will require the prescriber to provide the necessary clinical information and cooperation to pursue the Medicare appeal process at the levels shown below:

    • Initial Coverage Determination or Prior Authorization Request (plan must decide within 72 hours of receiving physician’s supporting statement, or 24 hours if physician requests expedited determination).  Official CMS Coverage Determination Request Form is attached.

    • Redetermination - first appeal level (plan must decide with 7 days, or within 72 hours for an expedited request

    • Reconsideration - second appeal level (independent review entity Maximus).

  • EPIC will cover the drug for beyond the initial 90 days only if the member and prescribing doctor have exhausted the above Medicare appeal process (initial coverage determination plus two appeal levels) and the Part D plan denies coverage of the drug.

    • The member must fax a copy of the reconsideration denial letter from the independent review entity (Maximus) to 1-800-562-1126. before EPIC will approve coverage of the drug. 

• If the pharmacist is unable to reach the prescriber, the pharmacist can obtain approval for a 3 day (72 hour) supply by calling the TCR Helpline to create an authorization in the claims system.

  •  If the member obtains a 3 day (72 hour) emergency supply and returns to the pharmacy on day 4, and the physician still has not acted, a 3 day (72 hour) emergency supply may continue to be initiated until the prescriber contacts the TCR Helpline.

• As of Oct. 1, 2010, EPIC will no longer advocate for EPIC members by filing appeals to Part D plans when they deny coverage of a drug. In the past, EPIC was able to recoup much of its cost in having EPIC pay for drugs when a Part D plan denied them. Now, the burden of appealing will be placed solely on the EPIC member and their physician.

How is EPIC Rolling Out This Change and Informing EPIC Members and Pharmacists about it?

• In July 2010, EPIC sent letters to 36,000 members who, in the prior 100 days, had used a drug that EPIC paid for because the members’ Part D plan refused coverage. See sample letter, which identifies the particular drug that EPIC will no longer cover, and suggested that the member talk to their physician about changing to a different drug before October 1, 2010.  80% of these 36,000 members reportedly use only one drug that their Part D plan has not covered - the other 20% have more than one drug.  

  • The letter includes an official federal CMS form for requesting a coverage determination from the Part D plan, the initial stage before filing the two levels of appeal. 

  • In late August, 2010, a general letter explaining the changes was sent to all 226,0000 EPIC members informing them of this new procedure.

  • In late September, 2010, this letter was sent to new EPIC members and those currently exempt from joining Part D (union/retiree coverage, MA plan without drug coverage, and no Medicare Part A or B). In bold type the letter states that EPIC members who are exempt from Part D are not affected by this policy change.

• The Temporary Coverage Request (TCR) Helpline -- 1-800-634-1340 -- will be set up as of October 1, 2010.

• The State sent this information to PROVIDERS:

  •  63,000 physician prescribers a Prescriber Bulletin 10-July 2010 explaining the changes - with detailed instructions on using the TCR Helpline

  • 4400 EPIC provider pharmacies a Pharmacy Bulletin sent week of July 26th,  with detailed instructions

  • and will give instructions to pharmacists through a Medicaid Update, not yet issued as of August 16, 2010. 

Advocacy Strategies

• Strategy through end of 2010:  

  • Since EPIC will provide a 90-day supply if the member, with his or her physician, pursues the two levels of appeal, after requesting a coverage determination, this 90-day supply would get the member through the end of 2010, until their plan choice for 2011 takes effect (if they chose and enrolled in a different plan  for 2011 between 11/15/10-12/31/10) EPIC will provide the 90-day supply even if the appeals are not successful. 

  • EPIC members also have a one-time "Special Enrollment Period" (SEP) based on their being enrolled in EPIC, because it is a State Pharmaceutical Assistance Program (SPAP).  See more on SEPs. A SEP allows a Medicare Part D enrollee to switch plans during the middle of the plan year, outside of the usually limited annual enrollment period.  If the EPIC member has not already used their SEP for 2010, s/he may switch plans now, effective the first of the next month. This change will be effective for the remainder of 2010.  S/he may still switch to a different plan for 2011 during the annual enrollment period.  

• Strategy for 2011:

  • As a practical matter, all Medicare beneficiaries have the opportunity to change plans for the 2011 plan year.  These changes can be made during the Annual enrollment period between Nov. 15 - Dec. 31, 2010.   It is important that members carefully select and switch to a plan for 2011 that may better cover his or her prescriptions than their current plan.    EPIC uses "intelligent assignment" to select plans each year for members, based on their past drug usage. While this is better than the totally random assignment by which Medicaid recipients are assigned to Part D plans, it is not foolproof.  In the past, since EPIC would pay for a drug even if the Part D plan did not pay, it did not matter that much if  EPIC did not select the best plan for an individual, i.e. the one that covers most of his or her drugs without quantity limits or other prior authorization requirements.   NOW, it is imperative to pick the best plan using the Planfinder. 

• Learn how to appeal Part D plan denials. 

  • On the CMS coverage determination form that EPIC members are receiving by mail from EPIC, be sure to write in that you want the exception to continue as long as the member is enrolled in that plan, beyond the current plan year.  This is called "life use."  

  • Include a doctor's letter explaining the medical need for this drug, and why the substitute drugs are not adequate.

  • Part D plans rarely respond to initial coverage requests and appeals within the timelines set by law - see above.  If the plan is late, you can accelerate the appeal to Maximus.   See information in training materials below.

  • See Empire Justice Center outline, and Medicare Rights Center information, including its Part D Appeals Manual for Advocates .

    ---

    This article was authored by the Evelyn Frank Legal Resources Program of Selfhelp Community Services, Inc.