The Medicare Hospice Benefit and Medicare Part D April 18, 2014 Janis Bivins, RN Marilyn Tatro, RN

1. The Medicare Hospice Benefit and Medicare Part D April 18, 2014 Janis Bivins, RN Marilyn Tatro, RN John Gochnour, Esq.

2. The Hospice Benefit: • The Medicare Hospice Benefit • Patient is eligible for Medicare Part A; • Patient is certified as terminally ill: which is a prognosis of six months or less if the illness runs its normal course; • Elects to receive hospice, and agrees to waive rights to curative treatment for terminal illness. -42 C.F.R. 418.20 • Hospice Services covered by the Benefit: • services that are reasonable and necessary for the palliation and management of the terminal illness and related conditions. 78 F.R. 27827

3. Hospice Covered Services • Includes: nursing care; physical therapy; occupational therapy; speech- language pathology therapy; medical social services; hospice aide services; physician services; homemaker services; medical supplies (including drugs and biologics)…

4. Federal Requirements • “Hospices are required by Section 1861(dd)(1)(e) of the Act to furnish all drugs and supplies related to the terminal illness and related conditions.” 73 F.R. 32088, 32145 • “Drugs and Biologicals related to the palliation and management of the terminal illness and related conditions, as identified in the hospice plan of care, must be provided by the hospice…” 42 C.F.R. 418.106

5. The Issue • CMS’s Concern: Drugs covered under the Medicare Part A Hospice benefit are being inappropriately billed to Part D. • 2010: 750,590 hospice beneficiaries enrolled in Part D • 198,543 of those beneficiaries received 677,022 prescriptions believed to be appropriately covered under Hospice benefit • Cost: $33,638,137 by Part D; $3,835,557 unnecessary copayments • Key OIG Issue Areas: analgesics, anti-nausea, laxatives, anti-anxiety. Since September 2012 Medicare has encouraged sponsors to obtain Prior Authorization (“PA”) for these drugs.

6. Drug Coverage by the Part A Hospice Benefit: • Hospice is responsible for drugs that are (1) reasonable and necessary for the palliation and management of the (2) terminal illness and related conditions. • Two key Questions: • What is a related condition? • What is reasonable and necessary?

7. Good News: • We are responsible for determining the answer to both. • We simply must be able to explain why and how we reached our conclusion and show thorough documentation supporting the decision.

8. What is a Related Condition? • Reviewed on a case by case basis: “The unique physical condition of each terminally ill individual makes it necessary for these decisions to be made on a case–by-case basis.” • CMS’s aggressive position: • The statutory waiver is broad and “hospices are required to provide virtually all the care that is needed by terminally ill individuals.” CMS Letter Dec. 6, 2013 • “When an individual is terminally ill, many health problems are brought on by underlying condition(s), as bodily systems are interdependent.” 78 F.R. 27826 • Therefore: “Unless there is clear evidence that a condition is unrelated to the terminal illness, all services would be considered related.” 78 F.R. 27827 • Question: • Can we provide clear evidence documenting that the drug should be considered unrelated?

9. Who Determines if a Drug Is Reasonable and Necessary? • The hospice physician and inter-disciplinary team (“IDG”), in consultation with the patient’s attending physician—determine if a drug is reasonable and necessary. ***If a drug is determined to be related, but not reasonable and necessary, whether because it is ineffective or causes negative systems, Medicare prohibits the hospice or Part D from paying for the Medication.

10. Clarification on Hospice Formulary • Hospice Formulary: • Hospice may determine what drugs it will carry on its formulary. • Hospice may work from its formulary first in finding medications to provide pain and symptom relief for their patients. • But prescribed medications must meet the needs of the beneficiary. If formulary drugs are not working the hospice mustprovide an alternative drug if the formulary drug is not providing the necessary relief. • However, if a patient requests a specific drug, but the IDG determines that a formula drug would work equally well, the hospice need not pay for the requested drug.

11. Requests for Specific Drugs Cont. • If a medication is requested but hospice determines that it is not reasonable and necessary: • Hospice does not provide the drug—No Advance Beneficiary Notice of Non-coverage (“ABN”) • Hospice provides the drug—must provide ABN • Beneficiary can appeal the decision by filing CMS 1490s

12. Who Pays: Drugs used Prior to Election • Drugs used for the treatment of the terminal illness or related conditions prior to election: • REMEMBER: Plan of Care (“POC”) includes all drugs necessary for the palliation and management of the terminal illness and related conditions—even if the drug was used prior to election. Is the drug reasonable and necessary for treatment and palliation of the terminal illness or related condition (i.e. is it effective as part of the POC)? Hospice must provide as part of Part A Benefit Yes. If patient continues to use patient is liable No.

13. Prior Authorization • “Part D Sponsor should place beneficiary-level PA requirements on all drugs for hospice beneficiaries to determine whether drugs are coverable under Part D.” CMS March 10, 2014 Clarification Letter

14. Prospective Determinations • Hospice initiates communication with Sponsor prior to claim submission (best practice: at time of election). • Notifies sponsor of hospice election. • Identifies any drugs covered by Part D and provides explanation of why the drugs are unrelated to terminal illness. • Sponsor accepts hospice’s explanation as satisfactory to satisfy PA requirements. • Hospice can identify a patient’s Part D plan by requesting their pharmacy do an electronic eligibility query to CMS. • May initiate communication through sponsors 24 hour pharmacy help desk.

15. Concurrent Determinations Cont. • If hospice provider or prescriber does not respond: Part D can’t rule out that the claim is covered by Part A Hospice benefit, therefore, Sponsor will deny the claim. • No specific PA form in 2014 (see list of information) • Respond as quickly as possible for coverage determinations • Coverage determination time frames: • Expedited request: 24-hours after explanation provided • Standard request: 72-hours after explanation provided

16. Retrospective Determinations: Medications Provided After Election Before Notice • Payment is arranged between Part D Sponsor, hospice, and beneficiary. • Timely Filed NOE can help avoid issues Drug related to terminal condition—Hospice is liable Sponsor retroactively reviews medications provided during election period after receiving NOE Drug unrelated to terminal condition—Hospice or prescriber provides PA information. Part D pays

17. Payment disputes: CMS Independent Review Board • CMS recognizes disputes will arise: They propose to establish an independent review board to make a final determination on whether a drug is related or unrelated. • 2014 process: • Hospice and Part D must coordinate their benefits • Hospice/Prescriber should immediately provide PA documentation • Part D Sponsor should accept and maintain documentation that a drug is unrelated • Part D Sponsor can flag a claim for retrospective review once the independent review process is in place • Part D Sponsor and Hospice should negotiate retrospective recovery if sponsor paid for drugs after effective date of the election, but prior to notification from CMS

18. Recommendations • Review Documentation related to terminal illness: The clarification lettersrequire hospice providers to more thoroughly consider and better document whether conditions and prescribed medications are unrelated to underlying terminal illnesses.  • File NOEs ASAP: Thereby notifying Part D sponsors of Hospice election and avoiding retrospective recoveries. • Refine communication methods with Part D Sponsors. Who will initiate communication and at what point? • As soon as you know a patient has an unrelated medication need—initiate a conversation with Part D Sponsor. • Adopt new consent language to reflect change in approach to beneficiary liability. • Discuss the role of your medical director in helping determine whether conditions are related. • Must document any verbal Prior Authorizations