(Medicare Part D Manual)

 Immunosuppressive Drugs.  Drugs used in immunosuppressive therapy (such as cyclosporine) for a beneficiary who has received a Medicare covered organ transplant.   Hemophilia clotting factors.  Hemophilia clotting factors for hemophilia patients  competent to use such factors to control bleeding without medical supervision, and items related to the administration of such factors.    Oral Anti -Cancer Drugs.  Drugs taken orally during cancer chemotherapy provided they have the same active ingredients and are used for the same indications as chemotherapy drugs that would be covered if they were not self -administered and were administered as incident to a physicians professional service.    Oral Anti -emetic Drugs. Oral anti -nausea drugs used as part of an  anti-cancer chemotherapeutic regimen as a full therapeutic replacement for an intravenous anti -emetic drug within 48 hours of chemotherapy administration.   Pneumococcal vaccine.  The vaccine and its administration to a beneficiary if ordered by a physician.   Hepatitis B vaccine.  The vaccine and its administration to a beneficiary who is at high or intermediate risk of contracting hepatitis B.6  6  High risk groups currently identified include : individuals with ESRD; individuals with hemophilia who received Factor VIII or IX concentra tes; clients of institutions for individuals for the mentally handicapped; persons who live in the same household as a hepatitis B Virus (HBV) carrier; homosexual men; illicit injectable drug abusers.  Intermediate risk groups include: s taff in institutions for the mentally handicapped and workers in health care professions who have frequent contact with blood or blood- derived b ody fluids during routine work.                                                     Influenza vaccine.  The vaccine and its administration when furnished in compliance with any applicable state law.  The beneficiary may receive the vaccine upon request without a physicians order and without physician supervision.   Antigens.  These are prepared by a physician (usually an allergist) for a specific patient.  The physician or physicians nurse gener ally administers them in the physicians office.  In some cases the physician prepares antigens and furnishes them to a patient who has been taught to self -administer them at home.    Erythropoietin (EPO).  EPO for the treatment of anemia for persons with chronic renal failure who are on dialysis.   Parenteral Nutrition.   Parenteral nutrients are covered under the prosthetic benefit.  They are available to beneficiaries who cannot absorb nutrition through their intestinal tract.  Parenteral nutrition is admin istered intravenously and is regulated as a drug by the FDA.    Intravenous Immune Globulin Provide in the Home.  The Medicare Modernization Act created a benefit for the provision of intravenous immune globulin (IVIG) for beneficiaries with a diagnosis of primary immune deficiency disease.  Coverage is provided if a physician determines that the administration of IVIG in the patients home is medically appropriate.  Payment is limited to that for the IVIG itself and does not cover items and services related to administration of the product.  Part B Covered Drugs in the Context of a Professional Service   Drugs furnished Incident To a Physicians Service.  These are injectable or intravenous drugs that are administered predominantly by a physician or under a physicians direct supervision as incident to a physicians professional service.  The statute limits coverage to drugs that are not usually self -administered.7  In order to meet all the general requirements for coverage under the incident -to provision, an FDA approved drug or biological product must:   Be of a form that is not usually self -administered (as determined by the A/B MAC contractor);   Must be furnished by a physician; and   Must be administered by the physician, or by auxiliary personnel employ ed by the physician and under the physicians personal supervision.  The charge, if any, for the drug or biological product must be included in the physicians bill and the cost of the drug or biological product must represent an expense to the physician.  Drug and biological products  furnished by other health professionals may also meet these requirements.   7 If a drug is not self -administered by more than 50 percent of Medicare beneficiaries,  it is considered not usually self-administered.                                                    Drugs furnished by a Medicare Advantage Organization Incident To a Physicians Service.  If a drug could be covered under Part B when furnished by a physician who incurred an expense in procuring the drug, it could also be covered under Part B in the case of a Medicare Advantage (MA) plan physician when the MA organization has incurred the expense of procuring the drug, and the drug is administered to an enrollee in the MA plan.  Under Pub. 100- 02, Medicare Benefit Policy Manual, chapter 15, section 60.1, drugs can be covered as incident to physicians services if they represent an expense to the physician or legal entity billing for the services or supplies.  Applying this principle to the case of a not -usually self administered drug administered by an MA plan physician to an MA plan enrollee, if the MA organization supplies the drug to the plan physician, it is the legal entity billing for the dr ug, since it is the entity that receives payment from Medicare that includes the cost of such a drug.  Consequently, if the MA organization supplies the drug to the network provider, the MA organization should account for the drug under its A/B benefits.  If a network pharmacy supplies the drug directly to the beneficiary, the drug must be accounted for under its Part D benefits.  Separately Billable ESRD Drugs.  Most drugs furnished by dialysis facilities are separately billable.  The largest Medicare expenditures for such drugs are for erythropoietin (EPO) which is covered for dialysis beneficiaries when it is furnished by independent and hospital -based ESRD facilities, as well as when it is furnished by physicians.   Separately billable drugs provided in Hospital Outpatient Departments.  Medicare continues to pay s eparately for drug and biological products, and radiopharmaceuticals whose median cost per administration exceeds an amount (or threshold amount) determined by CMS, while packagin g the cost of dr ugs, biological products , and radiopharmaceuticals whose median cost per administration is less than an amount (or threshold amount) determined by CMS  into the procedures with which they are billed.   Drugs covered as Supplies or -  Integral to a Procedure.   Some drugs are covered as supplies that are an integral part of a procedure which is a diagnostic or therapeutic service, including radiopharmaceuticals (both diagnostic and therapeutic) and low osmolar contrast media.  Other examples of drugs covered under the integral to a procedure provision include eye drops administered before cataract surgery.   Blood.  Medicare does make separate payment for blood and components .  The Center for Biologics Evaluation and Research under the FDA regulates the collection of blood and blood components used for transfusion or for the manufacture of pharmaceuticals derived from blood and blood components.  Drugs furnished as a part of a service in these provider settings. 1. Drugs packaged under the Hospital Outpat ient Prospective Payment System (OPPS); 2. Drugs furnished by ESRD facilities and included in Medicares ESRD composite rate; 3. Osteoporosis drugs provided by home health agencies under certain conditions; 4. Drugs furnished by critical access hospitals (CAH) outpatient departments; 5. Drugs furnished by a rural health clinic (RHC); 6. Drugs furnished by federally qualified health centers (FQHC); 7.  Drugs furnished by community mental health centers (CMHC);  8. Drugs furnished by ambulances; 9. Separately  billable drugs provided in comprehensive outpatient rehabilitation facilities (CORF).   Part D Covered Drugs  Definition of a Part D Covered Drug   A Part D covered drug is available only by prescription, approved by the FDA (or is a drug described under se ction 1927(k)(2)(A)(ii) or (iii) of the Act), used and sold in the United States, and used for a medically accepted indication (as defined in section 1927(k)(6) of the Act).  A covered Part D drug includes prescription drugs, biological products, insulin a s described in specified paragraphs of section 1927(k) of the Act, vaccines licensed under section 351 of the Public Health Service Act and for vaccine administration on or after January 1, 2008, its administration.  The definition also includes medical supplies directly associated with delivering insulin to the body, including syringes, needles, alcohol swabs, gauze, and insulin injection delivery devices not otherwise covered under Medicare Part B, such as insulin pens, pen supplies, and needle -free syrin ges, can satisfy the definition of a Part D drug.  CMS defines those medical supplies to include syringes, needles, alcohol swabs, gauze, and those supplies directly associated with delivering insulin into the body.   Part D Supplementary (Excluded) Drugs   The definition of a covered Part D drug excludes any drug for which as prescribed and dispensed or administered to an individual, payments would be available under Parts A or B of Medicare for that individual, even though a deductible may apply.   In additi on, the definition of a covered Part D drug specifically excludes drugs or classes of drugs, or their medical uses, which may be excluded from coverage or otherwise restricted under Medicaid under section 1927(d)(2) of the Act, with the exception of smoking cessation agents.  The drugs or classes of drugs that may currently be otherwise restricted under Medicaid include:    Agents when used for anorexia, weight loss, or weight gain (even if used for a non-cosmetic purpose (i.e., morbid obesity)).   Agents when used to promote fertility.   Agents when used for cosmetic purposes or hair growth.  Agents when used for the symptomatic relief of cough and colds.   Prescription vitamins and mineral products, except prenatal vitamins and fluoride preparations.  Nonprescription drugs.   Covered outpatient drugs which the manufacturer seeks to require as a condition of sale that associated tests or monitoring services be purchased exclusively from the manufacturer or its designee.   Agents when used for the treatment of sexual or er ectile dysfunction (ED). ED drugs will meet the definition of a Part D drug when prescribed for medically -accepted indications approved by the FDA other than sexual or erectile dysfunction such as pulmonary hypertension.  However, ED drugs will not meet th e definition of a Part D drug  when used off -label, even when the off label use is listed in one of the compendia found in section 1927(g)(1)(B)(i) of the Act : American Hospital Formulary Service Drug Information, and DRUGDEX  Information System.  ED drugs meet the definition of a Part D drug only when used for FDA -approved indications.   While these drugs or uses are excluded from basic Part D coverage, Part D sponsors can generally include them as part of supplemental benefits, provided they otherwise meet the definition of a Part D drug.  Because over -the-counter (OTC) drugs do not otherwise meet the definition of a Part D drug, they may not be included as part of supplemental benefits; however, under certain conditions as part of a plan utilization managem ent program, OTC drugs can be provided at no cost to enrollees.  The cost of these drugs to the Part D sponsor would be treated as administrative costs under such programs.   Other Resources   1. Pub. 100- 02, Medicare Benefit Policy Manual, Chapter 15.  Covere d Medical and Other Health Services.  Section 110  2. Pub. 100- 02, Medicare Benefit Policy Manual Chapter 15.  Covered Medical and Other Health Services Section 50.2.  3. Reference Guide for Medicare Physician & Supplier Billers, Helping Front Office Personnel Navigate Medicare Rules for Part B Claims Processing.  MedLearn Matters, Second Edition, October 2006. Chapter 6  Appendix C - Summary of Coverage Policy   ATTACHMENT I   Part B Drugs and Part D Coverage Chart   Drugs are covered under Part B in a variety of settings and under a variety of payment methodologies.   Some drugs are paid on a cost basis or are part of a prospective payment, including: drugs packaged under the outpatient prospective payment system (OPPS); drugs furnished by End-Stage Renal Diseas e (ESRD) facilities and included in Medicares ESRD composite rate; osteoporosis drugs provided by home health agencies under certain conditions; and drugs furnished by: critical access hospitals outpatient departments (CAHs); rural health clinics (RHCs); federally qualified health centers (FQHCs); community mental health centers (CMHCs); and ambulances.    In addition, there are 13 categories of drugs for which separate payment is made under Part B8, including: drugs furnished incident to a physicians se rvice; separately billable ESRD drugs; separately billable drugs provided in hospital outpatient departments; durable medical equipment (DME) supply drugs; drugs covered as supplies; drugs used in immunosuppressive therapy; blood clotting factors; certain vaccines; antigens; parenteral nutrition; certain oral drugs used in cancer treatment; separately billable drugs provided in comprehensive outpatient rehabilitation facilities (CORFs); and intravenous immune globulin provide in the home.9