Potential Effects of COVID-19 on Health Plans: PDE records and UM edits (a preliminary review)

By Lynn Stauffer & Derek Frye
Thu, Apr, 16, 2020

As the COVID-19 situation continues to develop, we wanted to share some preliminary information we’re hearing from our health plan clients. While we expect several areas of pharmacy utilization to potentially be affected, we wanted to first touch on two topics to be monitoring: PDE records and UM practices.

PDE records

The Centers for Medicare and Medicaid Services (CMS) has historically provided regulation and guidance for disasters or emergencies under the Medicare Program. During these conditions, Medicare Part D plans could accommodate special allowances for members who exceeded their standard benefits under the Part D program for which they enrolled. Special requirements during a disaster or emergency include waiving prior authorizations requirements, relaxing of clinical edits (i.e., refill-too-soon), covering out-of-network claims, and waiving member copayment requirements for certain drugs such as vaccines. All these temporary allowances afford members aid and relief during these difficult times.

In these extraordinary times with COVID-19, CMS continues to offer guidance to Part D plans while ensuring program integrity is not lost. CMS recently released guidance related to Prescription Drug Event (PDE) records, to address COVID-19 while maintaining the rule of law, and how these records are and will be affected because of these temporary and special allowances. Pharmacists can authorize emergency fills in the absence of prescribers and their ability to provide refill renewal prescriptions. Even though this is CMS’ enforcement discretion to exercise, Part D plans are still responsible for submitting accurate and complete PDE records with the appropriate Prescriber ID information. Part D plans are not allowed to submit PDE records without active and valid National Provider Identifiers (NPIs) of the prescribers of the drugs, or a TYPE 1 NPI in the Prescriber ID field. Since pharmacists can authorize emergency fills when there is a declared state of emergency, CMS will allow submission of PDE records with a TYPE 2 NPI in the Prescriber ID field if it is the same NPI in the Service Provider ID field. Further, CMS has temporarily relaxed enforcement of PDE records in connection with this NPI data.

Regardless of the types of disasters or states of emergency, CMS will continue to monitor and verify the quality, accuracy, and timeliness of PDE record submissions. Part D plans or their delegated pharmacy benefit manager (PBM) should continue to be consistent and active with PDE record generation and submissions. It is critical to address PDE errors as soon as possible to avoid PDE rejections. To assist Part D plans with their PDE record reporting, CMS recently announced the continuation of two reporting initiatives for the 2020 benefit year, the PDE Reports and PDE Analysis. CMS’ contractor, Acumen, will continue to facilitate these initiatives.

UM Practices

Burchfield has also observed (or heard) of potential adjustments to utilization management (UM) controls (sometimes called “PA”, or prior authorization, controls) that PBMs are putting into place to help manage COVID-19. These could include controls for some of the medications you’ve heard about in the news – chloroquine, Kaletra, etc. – but also there may be overrides entered to allow grace fills, or bypass early refill limits, etc. While the spirit of emergency UM control adjustments or the relaxing of UM restrictions is designed to speed the access to life saving products, it’s important to be vigilant in monitoring for potential “bad actors” attempting to take advantage of relaxed controls. At a minimum, consider implementing dashboard reports (either internally, or have your PBM provide) that provide insight into the new utilization patterns in place for any products where UM controls have changed in the last 30 days, or any products that have seen spikes in utilization over a rolling 30-day or 15-day period. While most of the new utilization is probably valid, even just a few “less than valid” transactions of high-cost products that slip through the new, looser UM controls could easily cost your plan many thousands of dollars. Catching it early, through vigilant monitoring (ideally daily) and being aware of UM control changes (and how to stop bad actors with slightly more restrictive controls) could quickly pay for itself in terms of the time invested in reviewing monitoring reports.

As extraordinary times call for extraordinary action, Part D plans should continue with assisting members to the greatest extent possible, while remaining vigilant with the important and necessary administration of the Medicare Part D program.


Materials referenced:

March 10, 2020 – Information Related to Coronavirus Disease 2019 – COVID -19 memo

March 24, 2020 – Continuation of the Prescription Drug Event (PDE) Reports and PDE Analysis Reporting Initiatives for the 2020 Benefit Year memo

April 3, 2020 – Notification of PDE Prescriber ID Editing and States of Emergencies