Important Information for Dispensing Providers With the implementation of the PDL, dispensing providers are required to: Obtain a completed Prior Authorization/Preferred Drug List (PA/PDL) Exemption Request form (fillable PDF, 144 KB) for non-preferred drugs. Submit a PA request to Wisconsin Medicaid. Retain a completed copy of the PA/PDL Exemption Request. Providers can contact Provider Services at (800) 947-9627 or (608) 221-9883 for additional information.

Background

Effective for dates of service on and after October 1, 2004, the Division of Health Care Financing (DHCF) is implementing a Preferred Drug List (PDL) and Supplemental Rebate Program for Wisconsin Medicaid and BadgerCare fee-for-service and SeniorCare as authorized in the state’s 2003-05 biennial budget. This Wisconsin Medicaid and BadgerCare Update is for dispensing providers (e.g., pharmacies, federally qualified health centers, blood banks).

Currently, the state of Wisconsin spends over $700 million each year on prescription drugs for Wisconsin Medicaid and BadgerCare recipients and SeniorCare participants. The new PDL and supplemental manufacturer rebates will result in significant savings for Wisconsin Medicaid, BadgerCare, and SeniorCare.

Non-preferred drugs require prior authorization (PA). Preferred drugs on the PDL do not require PA, although these drugs may have other restrictions (e.g., age, diagnosis). Prescribers are encouraged to write prescriptions for preferred drugs; however, a PA process is available for non-preferred drugs.

Based on the therapeutic significance and cost effectiveness of each drug, supplemental rebates with drug manufacturers are negotiated and PDL recommendations are made to the Wisconsin Medicaid PA Advisory Committee. To establish drugs to be included on the PDL, the PA Advisory Committee reviews research and clinical information prepared by clinical pharmacists. Research is based on peer-reviewed medical literature and current studies and trials.

The PA Advisory Committee consists of physicians, pharmacists, advocates, and consumers from the state of Wisconsin. Their responsibility is to review evaluations and make recommendations to the DHCF pertaining to drugs that should be included on the PDL. For additional information on the PA Advisory Committee, refer to the PA Advisory Committee Web site at www.pac.wisconsin.gov/.

The PDL will be phased in by drug class for Wisconsin Medicaid, BadgerCare, and SeniorCare beginning in October 2004 and continuing through 2005. Information will be published in Updates as drug classes are phased in. Changes to the PDL and the PDL implementation schedule will be posted on the Medicaid Web site at dhs.wisconsin.gov/medicaid/. Providers should refer to the Medicaid Web site on and after September 22, 2004, for the PDL and implementation schedule.

The SeniorCare drug search tool will indicate if a SeniorCare-covered drug is a preferred or non-preferred drug. Refer to the SeniorCare Web site at dhs.wisconsin.gov/seniorcare/ for the SeniorCare drug search tool.

ePocrates

Providers may also access the Wisconsin Medicaid PDL through ePocrates. ePocrates’ products provide clinical reference information specifically for health care providers to use at the point of care. Prescribers and dispensing providers who use personal digital assistants (PDAs) can subscribe and download the PDL by accessing the ePocrates Web site at www.epocrates.com/.

Implementation of Preferred Drug List

Beginning in October 2004, as initial drug classes are phased in, dispensing providers will receive an informational response on claim submissions for non-preferred drugs. Informational responses will provide dispensing providers the opportunity to contact the prescriber to change the recipient’s prescription to a preferred drug or to begin the PA process when it is clinically necessary for the recipient to remain on a non-preferred drug. Informational responses do not generate a claim denial.

Dispensing providers will receive explanation of benefits (EOB) code 354 in the real-time claim response in the additional message information field. Explanation of benefits code 354 states, "Non-preferred drug is being dispensed. Please refer to the PDL for preferred drugs in this therapeutic class." Dispensing providers that submit paper drug claims will receive this EOB code on their Remittance and Status (R/S) Report.

Beginning November 1, 2004, claims submitted for non-preferred drugs will be denied unless the dispensing provider submits a claim to Wisconsin Medicaid with an approved PA number. Dispensing providers who submit Point-of-Sale (POS) claims will receive the following EOB and National Council for Prescription Drug Programs (NCPDP) reject codes, indicating a denial in the claim response if the claim is not submitted with an approved PA number:

• Explanation of benefits code 366: "Prior authorization is required for non-preferred drugs. Please refer to the PDL for preferred drugs in this therapeutic class."
• National Council for Prescription Drug Programs reject code 75: "Prior authorization required."

Dispensing providers will receive EOB code 366 on their R/S Report and NCPDP reject code 75 on the 835 Health Care Claim Payment/Advice transaction.

Dispensing Providers’ Responsibilities for Non-preferred Drugs

Beginning October 1, 2004, PA requests must be submitted for non-preferred drugs. For PA requests, prescribers are required to complete a Prior Authorization/Preferred Drug List (PA/PDL) Exemption Request form, HCF 11075 (Dated 09/04), and mail or fax the completed copy of the form to the dispensing provider where the prescription will be filled. The prescriber may also send a completed copy of the form with the recipient to the dispensing provider. Both the prescriber and dispensing provider are required to retain a completed copy of the PA/PDL Exemption Request. Attachment 1 (PDF, 76 KB) of this Update is a copy of the PA/PDL Exemption Request Form Completion Instructions, HCF 11075A (Dated 09/04). Attachment 2 (fillable PDF, 144 KB) is a copy of the PA/PDL Exemption Request for photocopying.

If a PA/PDL Exemption Request is not sent to the dispensing provider by the prescriber for a new prescription or a refill of an existing prescription for a non-preferred drug, the dispensing provider is required to contact the prescriber. The prescriber may choose to change the prescription order to a preferred drug if medically appropriate for the recipient, or the prescriber may complete the PA/PDL Exemption Request form.

Information on the PA/PDL Exemption Request does not replace a prescription. The PA/PDL Exemption Request is required for each PA request.

Submitting Prior Authorization Requests

Current, approved PAs will be honored until their expiration date. Refer to the PDL implementation schedule on the Medicaid Web site for specific information on each drug class.

STAT-PA

Dispensing providers may use the Specialized Transmission Approval Technology-Prior Authorization (STAT-PA) system to submit PA requests for non-preferred drugs. Follow the STAT-PA instructions provided on the PA/PDL Exemption Request. If a dispensing provider submits a PA request using the STAT-PA system, the provider will receive an immediate response. For STAT-PA requests, dispensing providers should call (800) 947-1197 or (608) 221-2096.

If a PA request is submitted for a preferred drug using the STAT-PA system, dispensing providers will receive a response that states, "This is a preferred drug. Prior authorization is not required." Dispensing providers should submit the claim through the real-time POS system or on a Noncompound Drug Claim form (fillable PDF, 115 KB), HCF 13072 (Rev. 06/03).

Paper Prior Authorization

Dispensing providers may submit paper PA requests for non-preferred drugs. A paper PA request consists of a completed Prior Authorization Request Form (PA/RF), completed by the dispensing provider, and the PA/PDL Exemption Request form, completed by the prescriber. For the PA/RF, follow PA/RF Completion Instructions and indicate process type 131.

Decisions for paper PA requests are made within 20 working days from the receipt of all information necessary to process the request; however, most decisions are made within 10 working days.

Paper PA requests will be returned to providers who submit the PA/PDL Exemption Request for a preferred drug because it is not needed.

Paper PA requests may be submitted by fax to Wisconsin Medicaid at (608) 221-8616 or by mail to the following address:

Wisconsin Medicaid
Prior Authorization
Ste 88
6406 Bridge Rd
Madison WI 53784-0088

Emergency Medication Dispensing

Providers are reminded that, in some cases, a 72-hour emergency medication supply may be dispensed (e.g., if the STAT-PA system is unavailable).

When drugs are dispensed in an emergency situation, providers may submit a Noncompound Drug Claim form (fillable PDF, 115 KB) with a Pharmacy Special Handling Request form (fillable PDF, 26 KB), HCF 13074 (Rev. 06/03), indicating the nature of the emergency.

Send completed Noncompound Drug Claim forms and special handling requests to:

Wisconsin Medicaid
Pharmacy Special Handling
Ste 20
6406 Bridge Rd
Madison WI 53784-0020

Criteria for Prior Authorization for Non-preferred Drugs

Clinical criteria for approval of a non-preferred drug must be documented by the prescriber on the PA/PDL Exemption Request. Criteria for approval of a PA request for a non-preferred drug include the following:

• The recipient has experienced a treatment failure with the preferred product(s).
• The recipient has conditions that prevent the use of the preferred product(s).
• There is a clinically significant drug interaction with another medication and the preferred product(s).
• The recipient has experienced intolerable side effects while on the preferred product(s).

If the recipient’s condition does not meet the previously indicated criteria, a paper PA request and peer-reviewed medical literature must be submitted to Wisconsin Medicaid for non-preferred drugs.

Currently, Wisconsin Medicaid requires PA on certain drug classes (e.g., Angiotensin Converting Enzyme inhibitor drugs, Non-Steroidal Anti-Inflammatory Drugs, Proton Pump Inhibitor drugs). These drug classes will continue to require PA following the implementation of the initial drug classes on the PDL. The same clinical criteria that is currently used for these classes of drugs will be used to approve PA requests. Providers can refer to the STAT-PA drug worksheets for the clinical criteria.

Coordination of Benefits

Providers are required to follow Wisconsin Medicaid PA policies even if a recipient’s commercial health insurance has a different policy. Therefore, dispensing providers are required to obtain PA for non-preferred drugs, regardless of other commercial health insurance coverage.

Compound Drugs

Compound drugs are excluded from PDL requirements. Prescribers are not required to complete a PA/PDL Exemption Request form and dispensing providers are not required to obtain PA for non-preferred products that are included in a compound drug.

Diagnosis-Restricted Drugs

Dispensing providers are required to submit a valid International Classification of Diseases, Ninth Revision, Clinical Modification diagnosis code on claims for drugs that are diagnosis restricted through Wisconsin Medicaid and preferred drugs on the PDL. Diagnosis codes must be submitted on the PA/PDL Exemption Request for non-preferred drugs (fillable PDF, 144 KB).

For a non-preferred drug that is diagnosis-restricted and is prescribed for uses outside Food and Drug Administration-approved indications, the prescriber is required to submit peer-reviewed medical literature with the PA/PDL Exemption Request to support the proven efficacy of the requested use of the drug.

Drug Utilization Review

Dispensing providers that submit claims using the POS system for recipients that transition from non-preferred drugs to preferred drugs should be aware that they may see an increase in the number of prospective Drug Utilization Review alerts, specifically the Additive Toxicity and Therapeutic Duplication alerts. Dispensing providers may override these alerts as appropriate.

Wisconsin Medicaid Pharmacy Web Page

Effective immediately, Wisconsin Medicaid will no longer mail quarterly revisions to the data tables on CD or paper. Changes and additions to the data tables and the PDL will now be included on the pharmacy service-specific Web page on the Medicaid Web site at dhs.wisconsin.gov/medicaid/.

The following data tables will be published monthly to the Medicaid Pharmacy Web page. Effective dates for these tables will be the first of each month:

• Brand medically necessary drugs.
• Diagnosis-restricted drugs.
• Legend Drug Maximum Allowable Cost (MAC) drugs.
• Prior authorization drugs.
• Over-the-counter MAC drugs.
• Preferred Drug List.

The following data tables will be published quarterly to the Medicaid Pharmacy Web page. Effective dates for these tables will be January 1, April 1, July 1, and October 1.

• Health Check "Other Services" covered by Wisconsin Medicaid without PA.
• Less-than-effective/Identical, Related, or Similar drugs.
• Manufacturers that have signed rebate agreements.
• Wisconsin Medicaid Noncovered Drugs — Manufacturer Rebates Refused.

Providers should check the Wisconsin Medicaid Web site the first of each month for any changes to the data tables.

Each month, a list of the revised data tables will be provided in the "What’s new on the Web" section of the Update Summary.

Providers who do not have Internet access can contact Provider Services at (800) 947-9627 or (608) 221-9883 to obtain paper copies of the PDL, the PDL implementation schedule, and data tables as they are revised. Policy changes will continue to be issued in Updates.

Information Regarding Medicaid HMOs

This Update contains Medicaid fee-for-service policy and applies to providers of services to recipients on fee-for-service Medicaid only. For Medicaid HMO or managed care policy, contact the appropriate managed care organization. Wisconsin Medicaid HMOs are required to provide at least the same benefits as those provided under fee-for-service arrangements.

Attachment 1: Prior Authorization Drug List (PA/DL) Exemption Request Completion Instructions (PDF, 76 KB)
Attachment 2: Prior Authorization Drug List (PA/DL) Exemption Request (fillable PDF, 144 KB)