By the authority vested in the Department of Social Services, MO HealthNet Division, under sections 208.153, 208.201, and 660.017, RSMo 2016, the division adopts a rule as follows:
13 CSR 70-20.075 is adopted.
A notice of proposed rulemaking containing the text of the proposed rule was published in the Missouri Register on June 1, 2021 (46 MoReg 944-947). Those sections with changes are reprinted here. This proposed rule becomes effective thirty (30) days after publication in the Code of State Regulations.
SUMMARY OF COMMENTS: The Department of Social Services, MO HealthNet Division (MHD), received nine (9) comments on the proposed rule.
COMMENT #1: David Braasch, President of Alton Memorial Hospital on behalf of BJC HealthCare in St Louis, commented that neither the Center for Medicare and Medicaid Services (CMS) Final Rule nor guidance mentions the need to apply Actual Acquisition Cost (AAC) to physician-administered drugs and that by capturing the maximum amount of 340B savings instead of the minimum amount set by CMS it will diminish covered entities' ability to utilize those savings to fund other programs.
RESPONSE: Covered entities submitting physician-administered drugs are not required to submit AAC. Covered entities may submit their AAC to MO HealthNet for 340B-purchased drugs. MO HealthNet will pay the lesser of the submitted charge or the Physician-Administered 340B Maximum Allowable Cost (MAC) price. If the covered entity submits a charge for a 340B-purchased
item higher than the 340B MAC price then the MHD will reimburse the facility at the Physician-Administered 340B MAC price.
COMMENT #2: David Braasch, President of Alton Memorial Hospital on behalf of BJC HealthCare in St Louis, commented that AAC is not defined in our State Plan Amendment (SPA) and creates inherent risk that covered entities will unwittingly file false claims. He raises the question of whether the SPA will meet federal standards.
RESPONSE AND EXPLANATION OF CHANGE: The MHD received CMS approval for our State Plan Amendment on June 15, 2021, with an effective date of July 1, 2021. The MHD has amended subsection (4)(A) of the proposed rule as it pertains to pharmacy providers to state "Actual acquisition cost is defined as the invoice cost for the NDC per billing unit. This does not include timely pay discounts or discounts paid as a rebate on a separate invoice for vol-ume-based purchases."
COMMENT #3: David Braasch, President of Alton Memorial Hospital on behalf of BJC HealthCare in St Louis, commented that the MHD should withdraw the emergency rulemaking, and proposed an effective date no sooner than the start of State Fiscal Year 2023. RESPONSE: MO HealthNet did not previously have an approved State Plan Amendment for reimbursement of 340B-purchased medications as required by the Covered Outpatient Drug Rule. The new 340B reimbursement State Plan Amendment has been approved by CMS as of June 15, 2021, with an effective date of July 1, 2021. The requirement to start July 1, 2021, is necessary to avoid the potential disallowance of over $70 million in Federal Financial Participation.
COMMENT #4: David Braasch, President of Alton Memorial Hospital on behalf of BJC HealthCare in St Louis, commented that the MHD policy should exclude 340B physician-administered drugs until and unless federal rulemaking formally mandates it.
RESPONSE: MO HealthNet is subject to the requirement in Section 1902(a)(30) of the Social Security Act that payments be consistent with efficiency, economy, and quality of care. This requirement does not exclude 340B-purchased drugs. Under the MO HealthNet reimbursement model for non-340B-purchased drugs, physician-administered drugs are reimbursed at the same level as non-physician- administered drugs. For 340B-purchased drugs, MO HealthNet is including an additional reimbursement for physician-administered drugs above those for non-physician-administered drugs to offset a portion of the lost revenue.
COMMENT #5: Brian Kinkade, Vice President of Children's Health and Medicaid Advocacy with the Missouri Hospital Association, commented that the federal requirement to reimburse 340B drugs at actual acquisition cost does not extend to physician-administered drugs, and 340B physician-administered drug reimbursement should be kept at its current level.
RESPONSE: MO HealthNet is subject to the requirement in Section 1902(a)(30) that payments be consistent with efficiency, economy, and quality of care. This requirement does not exclude 340B-purchased drugs. Under the MO HealthNet reimbursement model for non-340B-purchased drugs, physician-administered drugs are reimbursed at the same level as non-physician-administered drugs. For 340B-purchased drugs, MO HealthNet is including an additional reimbursement for physician-administered drugs above those for nonphysician-administered drugs to offset a portion of the lost revenue.
COMMENT #6: Brian Kinkade, Vice President of Children's Health and Medicaid Advocacy with the Missouri Hospital Association, commented that requiring hospitals to bill their actual acquisition cost for physician-administered drugs fails to recognize the practical reality of hospital pharmaceutical procurement, and increases the risk that a claim could be inaccurate, or that the validity of an individual claim would be unfairly questioned in an audit.
RESPONSE: Covered entities submitting physician-administered drugs are not required to submit AAC. Covered entities may submit their AAC to MO HealthNet for 340B-purchased drugs. MO HealthNet will pay the lesser of the submitted charge or the Physician-Administered 340B MAC price. If the covered entity submits a charge for a 340B-purchased item higher than the PhysicianAdministered 340B MAC price then the MHD will reimburse the facility at the Physician-Administered 340B MAC price.
COMMENT #7: Brian Kinkade, Vice President of Children's Health and Medicaid Advocacy with the Missouri Hospital Association, commented that MO HealthNet's fiscal note does not include significant costs providers will incur to comply with the rule, including the significant administrative effort required to discern the literal acquisition cost of 340B physician-administered drugs, major changes to hospital systems and retraining for staff to use the JG and TB modifiers to identify 340B claims and the compressed timeframe in which these changes are required to comply with the new rule.
RESPONSE: Covered Entities requested the use of modifiers to identify 340B claims to receive accurate payments. Covered Entities must decide on their own if it is financially and administratively feasible to continue to carve in Medicaid for 340B-purchased drugs. If the Covered Entities establish that the cost of compliance to utilize 340Bpurchased drugs for Medicaid participants is not satisfactory, Covered Entities are allowed to carve out for Medicaid and utilize non-340B stock for Medicaid participants. MO HealthNet allowed time for Covered Entities to contact the Health Resources & Services Administration (HRSA) and carve out Medicaid prior to the implementation of the emergency rule if they chose to do so.
COMMENT #8: Lisa Smith, Program Specialist, MO HealthNet Division, commented that section (1) should specify that it is the policy of the MHD to require 340B-covered entities to report their MO HealthNet provider ID to HRSA for each site that carves-in Medicaid for inclusion in the HRSA Medicaid Exclusion File (MEF). The MHD utilizes the MO HealthNet provider ID found on the MEF to identify providers who carve-in Medicaid and to prevent duplicate discounts.
RESPONSE AND EXPLANATION OF CHANGE: The MHD has amended section (1) to add specificity.
COMMENT #9: Lisa Smith, Program Specialist, MO HealthNet Division, commented subsection (4)(A) should include an actual acquisition cost definition, defined as "the invoice cost for the NDC per billing unit. This does not include timely pay discounts or discounts paid as a rebate on a separate invoice for volume-based purchases."
RESPONSE AND EXPLANATION OF CHANGE: The MHD has amended subsection (4)(A) to include an actual acquisition cost definition.