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[Federal Register Volume 80, Number 52 (Wednesday, March 18, 2015)]
[Notices]
[Pages 14145-14146]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-06226]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

Notice of Hearing: Reconsideration of Disapproval Louisiana 
Medicaid State Plan Amendment (SPA) 12-66-B

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Notice of hearing: Reconsideration of disapproval.

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SUMMARY: This notice announces an administrative hearing to be held on 
April 30, 2015, at the Department of Health and Human Services, Centers 
for Medicare and Medicaid Services, Division of Medicaid & Children's 
Health, Dallas Regional Office, 1301 Young Street, Room 730, Dallas, TX 
75202, to reconsider CMS' decision to disapprove Louisiana's Medicaid 
SPA 12-66-B.
    Closing Date: Requests to participate in the hearing as a party 
must be received by the presiding officer by April 2, 2015.

FOR FURTHER INFORMATION CONTACT: Benjamin R. Cohen, Presiding Officer, 
CMS, 2520 Lord Baltimore Drive, Suite L, Baltimore, Maryland 21244, 
Telephone: (410) 786-3169.

SUPPLEMENTARY INFORMATION: This notice announces an administrative 
hearing to reconsider CMS' decision to disapprove Louisiana's Medicaid 
SPA 12-66B which was submitted to the Centers for Medicare and Medicaid 
Services (CMS) on December 20, 2012 and disapproved on December 11, 
2014. In part, this SPA requested CMS approval to revise the current 
pharmacy reimbursement methodology for estimated acquisition cost (EAC) 
which is currently calculated as average acquisition cost (AAC) of the 
drug dispensed to a new calculation of AAC adjusted by a multiplier of 
1.1 for multiple source drugs and 1.01 for single source drugs. In 
addition, propose a reimbursement methodology of wholesale acquisition 
cost (WAC) adjusted by a multiplier of 1.05 for state-defined specialty 
therapeutic classes of drugs.
    The issues to be considered at the hearing are:
     Whether the state's proposed increased payment methodology 
under Louisiana Medicaid SPA 12-66-B complies with the requirements of 
section 1902(a)(30)(A) of the Act which requires, in part, that states 
have methods and procedures to assure that payment rates are consistent 
with efficiency, economy, and quality of care.
     Whether the state demonstrated that the proposed payment 
increases are consistent with the aggregate upper payment limits set in 
implementing regulations at 42 CFR 447.512 which provide that payments 
for drugs are to be based on the lower of: (1) The ingredient EAC of 
the drug and a reasonable dispensing fee; or (2) the provider's usual 
and customary charges to the general public.
     Whether the proposed calculation of EAC used in 
calculating upper payment limits (based on a multiple of the AAC) is 
consistent with the definition of EAC in 42 CFR 447.502, which defines 
EAC as ``the agency's best estimate of the price generally and 
currently paid by providers for a drug marketed or sold by a particular 
manufacturer or labeler in the package size of drug most frequently 
purchased by providers.''
    Section 1116 of the Act and federal regulations at 42 CFR part 430, 
establish Department procedures that provide an administrative hearing 
for reconsideration of a disapproval of a state plan or plan amendment. 
CMS is required to publish a copy of the notice to a state Medicaid 
agency that informs the agency of the time and place of the hearing, 
and the issues to be considered. If we subsequently notify the agency 
of additional issues that will be considered at the hearing, we will 
also publish that notice.
    Any individual or group that wants to participate in the hearing as 
a party must petition the presiding officer within 15 days after 
publication of this notice, in accordance with the requirements 
contained at 42 CFR 430.76(b)(2). Any interested person or organization 
that wants to participate as amicus curiae must petition the presiding 
officer before the hearing begins in accordance with the requirements 
contained at 42 CFR 430.76(c). If the hearing is later rescheduled, the 
presiding officer will notify all participants.
    The notice to Louisiana announcing an administrative hearing to 
reconsider the disapproval of its SPA reads as follows:

J. Ruth Kennedy
State Medicaid Director
Louisiana Department of Health and Hospitals
628 N. 4th Street
P.O. Box 91030
Baton Rouge, LA 70821

Dear Ms. Kennedy:

    I am responding to your request for reconsideration of the 
decision to disapprove Louisiana's Medicaid state plan amendment 
(SPA) 12-66B, which was submitted to the Centers for Medicare and 
Medicaid Services (CMS) on December 20, 2012, and disapproved on 
December 11, 2014. I am scheduling a hearing on your request for 
reconsideration to be held on April 30, 2015, at the Department of 
Health and Human Services, Centers for Medicare and Medicaid 
Services, Division of Medicaid & Children's Health, Dallas Regional 
Office, 1301 Young Street, Room 730, Dallas, TX 75202.
    I am designating Mr. Benjamin R. Cohen as the presiding officer. 
If these arrangements present any problems, please contact Mr. Cohen 
at (410) 786-3169. In order to facilitate any communication that may 
be necessary between the parties prior to the hearing, please notify 
the presiding officer to indicate acceptability of the hearing date 
that has been scheduled and provide names of the individuals who 
will represent the state at the hearing. If the hearing date is not 
acceptable, Mr. Cohen can set another date mutually agreeable to the 
parties. The hearing will be governed by the procedures prescribed 
by federal regulations at 42 CFR part 430.
    In part, this SPA would revise the current pharmacy 
reimbursement methodology for estimated acquisition cost (EAC) which 
is currently calculated as average acquisition cost (AAC) of the 
drug dispensed to a new

[[Page 14146]]

calculation of AAC adjusted by a multiplier of 1.1 for multiple 
source drugs and 1.01 for single source drugs. In addition, this SPA 
would apply a reimbursement methodology of wholesale acquisition 
cost (WAC) adjusted by a multiplier of 1.05 for state-defined 
specialty therapeutic classes of drugs.

The issues to be considered at the hearing are:
     Whether the state's proposed increased payment 
methodology under Louisiana Medicaid SPA 12-66-B complies with the 
requirements of section 1902(a)(30)(A) of the Act which requires, in 
part, that states have methods and procedures to assure that payment 
rates are consistent with efficiency, economy, and quality of care.
     Whether the state demonstrated that the proposed 
payment increases are consistent with the aggregate upper payment 
limits set in implementing regulations at 42 CFR 447.512 which 
provide that payments for drugs are to be based on the lower of: 1) 
the ingredient EAC of the drug and a reasonable dispensing fee; or 
2) the provider's usual and customary charges to the general public.
     Whether the proposed calculation of EAC used in 
calculating upper payment limits (based on a multiple of the AAC) is 
consistent with the definition of EAC in 42 CFR 447.502, which 
defines EAC as ``the agency's best estimate of the price generally 
and currently paid by providers for a drug marketed or sold by a 
particular manufacturer or labeler in the package size of drug most 
frequently purchased by providers.''
    In the event that CMS and the state come to agreement on 
resolution of the issues which formed the basis for disapproval, 
this SPA may be moved to approval prior to the scheduled hearing.

Sincerely,

Andrew M. Slavitt

Section 1116 of the Social Security Act (42 U.S.C. 1316; 42 CFR 
430.18) (Catalog of Federal Domestic Assistance program No. 13.714. 
Medicaid Assistance Program.)

    Dated: March 13, 2015.
Andrew M. Slavitt,
Acting Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. 2015-06226 Filed 3-17-15; 8:45 am]
BILLING CODE 4120-01-P
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