CMS Pub. 100-18, ch. 14, § 50.14.3

Part D sponsors must coordinate benefits with SPAPs and other providers of prescription

drug coverage and appropriately adjudicate claims. Compliance with this requirement

entails that the sponsor not only coordinate benefits with other payers at POS, but also work

with beneficiaries and other payers to resolve post-adjudicative payment issues arising from

retroactive claims changes.

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Retroactive claims adjustments can be necessitated by beneficiary changes (such as those

resulting from retroactive LIS eligibility determinations, LIS status changes, or midyear Part

D enrollment changes), sponsor receipt of other payer information, or errors in payer order.

Some of these changes, i.e., those occurring within the payers’ timely filing window (which

must be a minimum of 90 days for Part D, but may be as short as 30 days, for other (non-Part D) payers) may be addressed through pharmacy-initiated reverse and rebill transactions.

However, as specified in section 50.14.5 of this chapter, sponsors generally should limit

requests for pharmacy reprocessing to those situations involving a payment error. All

retroactive claims adjustments, related to payment errors, that cannot be addressed through

pharmacy reverse and rebilling must be handled by the Part D sponsor through other means.

Post-adjudicative changes, such as those that are due to enrollment changes, are changes that

affect beneficiary cost-sharing, premiums and/or plan benefit phase. Part D sponsors must

make the retroactive adjustments timely and promptly issue refunds or initiate recovery once

complete information regarding the claims adjustment is received. Federal regulations at

§ 423.466(a) require sponsors to process the adjustment and issue refunds or recovery

notices within 45 days of receipt of low income subsidy changes, FIR and/or NX

transactions necessitating the claims adjustment. Federal regulations at § 423.800(e) apply

this same timeframe to retroactive adjustments to cost-sharing for low-income subsidy

eligible individua ls.

Federal regulations at § 423.800(c) require plan sponsors to reimburse beneficiaries amounts

owed due to changes in LIS status. However, sponsors must make reasonable efforts to

determine which party should be reimbursed; i.e., the beneficiary or other party who paid on

the beneficiary’s behalf, for the excess cost sharing paid during a period of LIS retroactive

coverage. Sponsors should develop procedures for making these reimbursement

determinations and not adopt a “one size fits all” approach. Specifically, sponsors should not

automatically reimburse beneficiaries residing in LTC facilities, since it is unlikely that the

LTC pharmacy has collected the applicable cost-sharing due to the expectation that the

sponsor would eventually reimburse the pharmacy retroactively for these amounts. Rather,

sponsors should work with their network pharmacies to provide direct reimbursement for

any cost-sharing amounts not collected from LIS-eligible enrollees. Chapter 13 is available

on the CMS Website; see Appendix B for the specific Web address.

The instability of LIS data and Part D enrollments creates a significant volume of retroactive

adjustments, and it has become evident that sponsors are facing more claims adjustments

than current pharmacy claim reversal and rebilling approaches can adequately address. In

the case of a claims adjustment, if the beneficiary is no longer at the counter and a

supplemental payer's claim filing window is closed, the pharmacy can no longer effectively

coordinate benefits between payers. In addition, payers cannot effectively coordinate among

themselves, both because of the absence of electronic standards for post-adjudication claim

adjustments among payers (as opposed to between pharmacies and payers), and the presence

of contractual prohibitions between payers and pharmacies on the disclosure of proprietary

pricing information. Therefore, CMS continues to work with the industry to determine how

best to handle retroactive claims adjustments whenever the adjustment cannot be resolved

simply between the sponsor and the pharmacy.

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Regardless of the cause of the retroactive claims adjustment, sponsors have two choices for

determining the change to beneficiary TrOOP. The sponsor may adjust each claim that was

affected by the retroactive change, or they may process the adjustment as they administer the

benefit, provided that:

• TrOOP accumulators are updated immediately;

• Monies owed beneficiaries are refunded promptly;

• Claims are restacked and adjustments are processed at least quarterly; and

• An exceptions process exists for more frequent processing to meet beneficiary

needs, such as at disenrollment during the coverage year.

The methodologies for handling retroactive changes in TrOOP are described in Section 9 of

the Prescription Drug Event (PDE) guidance available on the CMS Website. See Appendix

B for the specific Web address. For further detail on reconciling payments, see section

50.14 of this chapter.

Part D sponsors also must determine whether or not any amount paid by any other payers

was TrOOP-eligible and must adjust, as necessary, the affected beneficiaries’ TrOOP

balances.