On November 9, the Department of Health and Human Services (HHS) issued a proposed rule to adopt updated versions of the retail pharmacy standards for electronic transactions adopted under the Administrative Simplification subtitle of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and to broaden the applicability of the HIPAA subrogation transaction.
If the proposed rule is finalized, covered entities would have to comply within 24 months after the effective date of the final rule, and small health plans would have 36 months to comply. Comments must be submitted by January 9, 2023 (60 days after date of publication in the Federal Register).
Under HIPAA, HHS is required to adopt standards for electronic health care administrative transactions conducted between health care providers, health plans, and health care clearinghouses. The National Committee on Vital and Health Statistics (NCVHS) serves as an advisory committee to the HHS Secretary and must recommend modification of HIPAA standards following review and approval of new or updated standards developed by Standards Development Organizations.
In 2009, HHS adopted the National Council for Prescription Drug Programs (NCPDP) Telecommunication Standard Implementation Guide, Version D, Release 0 (Version D.0) and equivalent NCPDP Batch Standard Implementation Guide, Version 1, Release 2 (Version 1.2) (collectively referred to as Version D.0) for retail pharmacy transactions. HHS also adopted the NCPDP Batch Standard Medicaid Subrogation Implementation Guide, Version 3, Release 0 (Version 3.0) for Medicaid pharmacy subrogation transactions, which Medicaid agencies use in transmitting claims to payers for the purpose of seeking reimbursement from the health plan responsible for a pharmacy claim the State has paid on behalf of a Medicaid recipient.
Since 2018, NCHVS has issued recommendations to adopt the following standards: NCPDP Telecommunications Standard Implementation Guide Version F6 (to replace Version D.0); NCPDP Batch Standard Implementation Guide Version 15 (to replace Version 1.2); and NCPDP Batch Standard Subrogation Implementation Guide Version 10 (to replace Version 3.0). These recommended standards were developed through consensus-based processes, which included the opportunity for public comment. NCVHS has recommended that HHS publish a proposed rule adopting more recent standards to address evolving industry changing business needs and sent letters in 2018 and 2020 that urge adoption of those standards.
Major Provisions of the Proposed Modifications to the National Council for Prescription Drug Programs Retail Pharmacy Standards and the Adoption of a New Pharmacy Subrogation Standard
Consistent with NCHVS recommendations, HHS proposes to adopt the following NCPDP standards:
- The NCPDP Telecommunication Standard Implementation Guide, Version F6 and equivalent NCPDP Batch Standard Implementation Guide, Version 15:
- HHS proposes adopting modifications to the current HIPAA retail pharmacy standards for the following transactions: health care claims or equivalent encounter information; eligibility for a health plan; referral certification and authorization; and coordination of benefits.
- Version F6 would upgrade the currently adopted Version D.0, such as improvements to the information attached to controlled substance claims, including refinement to the quantity prescribed field. This change would enable refills to be distinguished from multiple dispensing events for a single fill, which would increase patient safety. Version F6 provides more specific fields to differentiate various types of fees, including taxes, regulatory fees, and medication administration fees. Version F6 also increases the dollar amount field length and would simplify coverage under prescription benefits of new innovative drug therapies priced at, or in excess of, $1 million.
- The NCPDP Batch Standard Pharmacy Subrogation Implementation Guide, Version 10, for non-Medicaid health plans:
- While HIPAA currently only requires Medicaid agencies to use the Batch Standard Medicaid Subrogation Implementation Guide, Version 3.0, Version 10 would require all health plans to use the Pharmacy Subrogation Implementation Guide, pursuant to industry feedback that subrogation is needed beyond Medicaid.
- The current Medicaid Subrogation Implementation Guide Version 3.0 was adopted to support federal and state requirements for state Medicaid agencies to seek reimbursement from the correct responsible health plan. However, industry stakeholders reported that there is a need to expand the use of the subrogation transaction beyond Medicaid agencies. HHS notes that expansion of the standard would allow for better tracking for subrogation efforts and results across all health plans, and support cost containment efforts.
In the proposed rule, HHS states that the updated retail pharmacy standards are sufficiently mature for adoption and that covered entities are ready to implement them. HHS explains that adoption of the updated versions would provide improvements, including more robust data exchange, improved coordination of benefits, and expanded financial fields that would avoid the need to manually enter free text, split claims, or prepare and submit a paper Universal Claim Form.
The Centers for Medicare & Medicaid Services National Standards Group plans to hold a listening session on the proposed rule on Wednesday, November 30th from 2:00 to 3:30 PM EST to provide an overview of the proposed rule’s provisions and hear stakeholder feedback on the proposed rule. Additional information on the listening session is available here.