Category Archives: Medicare Set-Asides (MSAs)

Prescription drug updates may positively affect Medicare Set Aside

As part of our best business practices, we continually monitor RED BOOK®Average Wholesale Price (AWP) of the most common medications present in Workers’ Compensation Medicare Set-Aside (WCMSA) arrangements. This practice assists in identifying price changes positively affecting WCMSAs.

The month of May brought price drops for several different strengths of gabapentin, commonly used to treat neuropathic pain.

The products in the following table have a reduced AWP, confirmed in the Centers for Medicare and Medicaid Services (CMS) WCMSA portal.

Product Name NDC Code Dosage Form Strength AWP Unit Price Reduction
Gabapentin 10135-0646-05

 

CAP 400 mg $0.07
Gabapentin 10135-0647-05

 

TAB 600 mg $2.01
Gabapentin 10135-0648-05 TAB 800 mg $0.37

Please note that RED BOOK AWP is subject to change and this pricing is subject to an increase or decrease in the future.  

CMS uses the lowest AWP when reviewing a WCMSA. The lower price of these medications will immediately affect the prescription costs for WCMSAs (both present as well as prior WCMSA’s that have not settled and there is no CMS determination issued). We will contact our clients in reference to previously completed WCMSA’s where these medications have been prescribed. It is our recommendation that carriers, TPAs and claim handlers review cases to determine the benefit from decreased cost of these medications.

Optum will continue to keep the industry informed of changes in AWP pricing, in addition to when generic equivalents enter the market.

New WCRC, Capitol Bridge: Changes and Trends

Capitol Bridge, LLC assumed the reigns as the new Workers’ Compensation Review Contractor (WCRC) on 3/19/2018.

Immediately following the transition to Capitol Bridge, it was noted that they have a different methodology for pricing.  This has caused a slight increase in counter low/high determinations as the industry adjusts to the pricing methodology changes.

In addition to the above, Optum has found the turn around time for completed  WCRC determinations has increased from 9 days to 20 days.  Hopefully this is just a slow down due to the transition and will level out in the near future.

There have been several “hearing loss” cases which have been returned with counter high allocations for future office visits and additional audiograms over the claimant’s life expectancy.  Since Medicare does not cover ongoing office visits or testing once the claimant has been diagnosed with simple hearing loss (no other ear conditions noted), “hearing loss” claims have historically been approved as Zero MSA allocations.  Optum is currently resubmitting these cases for additional review and reconsideration of a Zero MSA allocation due to the error of inclusion of non-Medicare covered items/services.

The above changes appear to be due to the transition to the new contractor and should be temporary.  It was expected that there would be a short adjustment period as a result of the transition.   Optum will continue to report any additional trends we become aware of that will affect WCMSAs in an ongoing effort to keep our clients apprised of changes as they occur.

Don’t Rely on an MSP Conditional Payment Notice when Executing a Settlement Agreement and General Release

In a recent decision on 3/13/2018, Mayo v. NYU Langone Medical Center, the courts voided a settlement on the grounds of a mutual mistake because both the plaintiff and defense relied upon a conditional payment notice rather than a conditional payment demand or initial determination. The plaintiff provided a conditional payment notice that was dated several months prior to settlement in the amount of $2,824.50, which represented what the Centers for Medicare and Medicaid Services (CMS) believed to be payments made by Medicare at that time.

After the settlement was reported, CMS issued a demand in the amount of $145,764.08 to the estate of the Medicare beneficiary, who had exhausted all appeals with CMS in an attempt to reduce the Medicare recovery amount. The court rejected the arguments from the defense, stating that it was the plaintiff’s responsibility to obtain the final conditional payment amount from Medicare.

Best practices include obtaining a conditional payment notice pre-settlement so that all parties are aware that related conditional payments demanded must be reimbursed to Medicare. Settlement language must be clearly worded so that the parties know who is obligated to repay Medicare and whether the conditional payment reimbursement will be paid “out of” or “in addition to” the total settlement amount. When a settlement involves a Medicare beneficiary, both parties should not close their files until confirmation that conditional payment recovery has been fully satisfied.

Optum Settlement Solutions can provide assistance in:

  • Researching the Medicare Secondary Payer Recovery Portal to track potential conditional payments assigned, or added, to your claim, including interest being accrued
  • Obtaining a conditional payment summary pre-settlement so you may evaluate your case and plan your negotiation strategy
  • Providing notice to CMS of a settlement date and amount to elicit a final amount owed
  • Reviewing Medicare Secondary Payer (MSP) compliance settlement language
  • Appealing unrelated conditional payments demanded by CMS recovery contractors
  • Assuring that the MSP conditional payment debt has been fully satisfied

Prescription drug updates may positively affect Medicare Set Aside

As part of our best business practices, we continually monitor RED BOOK®Average Wholesale Price (AWP) of the most common medications present in Workers’ Compensation Medicare Set-Aside (WCMSA) arrangements. This practice assists in identifying price changes positively affecting WCMSAs.

The month of February brought price drops of the following medications:

  • buprenorphine/naloxone (Suboxone®) commonly prescribed for opioid dependence
  • diclofenac (Voltaren®) in multiple strengths used to treat pain
  • methadone (Dolophine®) commonly prescribed for detoxification or pain management
  • bupropion (Wellbutrin®) in multiple strengths prescribed for depression
  • clonazepam (Klonopin®) used for anxiety or panic disorders
  • quetiapine (Seroquel®) commonly used to treat bipolar disorder, depression or schizophrenia
  • tramadol (Ultram®) used to treat pain

The products in the following table have a reduced AWP, confirmed in the Centers for Medicare and Medicaid Services (CMS) WCMSA portal.

Product Name

NDC Code

Dosage Form

Strength

AWP Unit Price Reduction

Bupropion Hydrochloride

00781-5528-31

TER

150 mg

$3.92

Bupropion Hydrochloride

00781-5529-31

TER

300 mg

$2.24

Diclofenac Sodium

61145-0102-12

ECT

75 mg

$0.51

Buprenorphine Hydrochloride/Naloxone Hydrochloride

00406-8020-03

SL TAB

8/2 mg

$0.34

Clonazepam

00781-8018-05

TAB

0.5 mg

$0.11

Diclofenac Sodium

61145-0101-18

ECT

50 mg

$0.10

Quetiapine Fumarate

00904-6639-61

TAB

50 mg

$0.09

Tramadol Hydrochloride

68094-0017-61

TAB

50 mg

$0.06

Methadone Hydrochloride

66689-0898-40

TBS

40 mg

$0.04

Please note that RED BOOK AWP is subject to change and this pricing is subject to an increase or decrease in the future.

CMS uses the lowest AWP when reviewing a WCMSA. The lower price of these medications will immediately affect the prescription costs for WCMSAs (both present as well as prior WCMSA’s that have not settled and there is no CMS determination issued). We will contact our clients in reference to previously completed WCMSA’s where these medications have been prescribed. It is our recommendation that carriers, TPAs and claim handlers review cases to determine the benefit from decreased cost of these medications.

Optum will continue to keep the industry informed of changes in AWP pricing, in addition to when generic equivalents enter the market.