Frequently Asked Questions are used to provide additional information and/or statutory guidance not found in State Medicaid Director Letters, State Health Official Letters, or CMCS Informational Bulletins. The different sets of FAQs as originally released can be accessed below.
Frequently Asked Questions
Why is there a State column labeled XX when viewed as National Totals in the State Drug Utilization Data (SDUD)?
Since all of the states are combined in the National Totals, the state abbreviation will show on the "National Totals" and "Annual State Detail" option as "XX".
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FAQ ID:91811
SHARE URLWhy does some State Drug Utilization Data (SDUD) have an asterisk?
As CMS is obligated by the Federal Privacy Act, 5 U.S.C. Section 552a and the HIPAA Privacy Rule, 45 C.F.R Parts 160 and 164, to protect the privacy of individual beneficiaries and other persons, all direct identifiers have been removed and data that are less than eleven (11) counts are suppressed. An asterisk (*) notes suppressed data. CMS applies counter or secondary suppression in cases where only one prescription is suppressed for primary reasons, e.g. one prescription in a state. Also, if one sub-group (e.g. number of prescription) is suppressed, then the other sub-group is suppressed.
See Also:
- What fields changed when CMS moved the State Drug Utilization Data (SDUD) to data.medicaid.gov?
- What are the data field descriptions for the State Drug Utilization Data (SDUD)?
- Is the redacted State Drug Utilization Data (SDUD) available to the public?
FAQ ID:91831
SHARE URLIs the redacted State Drug Utilization Data (SDUD) available to the public?
No. In accordance with federal laws, State Drug Utilization Data (SDUD) that has been suppressed is not available for public consumption. As CMS is obligated by the Federal Privacy Act, 5 U.S.C. Section 552a and the HIPAA Privacy Rule, 45 C.F.R Parts 160 and 164, to protect the privacy of individual beneficiaries and other persons, all direct identifiers have been removed and data that are less than eleven (11) counts are suppressed. A checkmark in the "Suppression Used" column notes suppressed data. CMS applies counter or secondary suppression in cases where only one prescription is suppressed for primary reasons, (e.g., one prescription in a state). Also, if one sub-group (e.g., number of prescriptions) is suppressed, then the other sub-group is suppressed.
FAQ ID:91856
SHARE URLDoes the State Drug Utilization Data (SDUD) reported for each quarter's posting always include all of the quarterly data reported by states?
If the data arrives late, it may miss the quarterly posting. However, it will be included in the next quarter's web posting.
FAQ ID:91916
SHARE URLWhat are the data field descriptions for the State Drug Utilization Data (SDUD)?
For current versions of MDRP File Formats/Data Definitions, please refer to: https://www.medicaid.gov/medicaid/prescription-drugs/medicaid-drug-rebate-program/medicaid-drug-rebate-program-mdrp-file-formats-data-definitions-and-medicaid-drug-programs-mdp-email-communications/index.html
See Also:
- What fields changed when CMS moved the State Drug Utilization Data (SDUD) to data.medicaid.gov?
- Is the redacted State Drug Utilization Data (SDUD) available to the public?
FAQ ID:91956
SHARE URLHow does section 1902(a) (25) of the Social Security Act (the Act) define "health insurers"?
Section 1902(a) (25) (I) of the Act defines ""health insurers"" to include self-insured plans, group health plans (as defined in section Medicaid Management Information Systems (MMIS)(l) of the Employee Retirement Income Security Act of 1974 (ERISA)), service benefit plans, managed care organizations (MCOs), pharmacy benefit managers (PBMs), and ""other parties that are, by statute, contract, or agreement, legally responsible for payment of a claim for a health care item or service."" Workers' compensation, automobile insurance, and liability insurance plans all are included within the definition of ""health insurer"" for purposes of this section and the requisite state laws which must be enacted pursuant to it.
The CMS interprets ""other parties that are, by statute, contract, or agreement, legally responsible for payment of a claim"" to include:
- Prepaid Inpatient Health Plans (PIHPs) and Prepaid Ambulatory Health Plans (PAHPs). For purposes of Medicaid managed care, PIHPs and PAHPs are entities that contract with the state to deliver Medicaid-covered services; in that context, they would also be considered ""other parties that are, by contract, legally responsible for payment of a claim for a health care item or service;"" and,
- Such entities as third party administrators (TPAs), fiscal intermediaries, and managed care contractors, which administer benefits on behalf of the riskbearing plan sponsor (e.g., an employer with a self-insured health plan). CMS recognizes that entities such as PBMs and TPAs do not necessarily have ultimate financial liability, but, to the extent that they are required, by contract or otherwise, to review claims and authorize payment by the plan sponsor, they are included within the definition of ""third party"" and ""health insurer"" for purposes of section 1902(a) (25) of the Act.
Nothing in revisions to the Social Security Act made by the Deficit Reduction Act of 2005 (DRA) imposes new liability to pay claims on entities that do not otherwise bear such liability. Nor does section 1902(a) (25) of the Act negate any right of indemnification against a plan sponsor or other entity with ultimate liability for health care claims by a contracting party that pays the claims.
Supplemental Links:
- This FAQ was released as part of a larger set. View the full set. (PDF, 252.32 KB)
FAQ ID:94021
SHARE URLAre indemnity insurance policies considered to be third party resources for purposes of Medicaid?
Indemnity policies may be considered third party resources if the policies meet certain criteria. Federal Medicaid regulations at 42 CFR 433.136 define a third party as ""any individual, entity, or program that is or may be liable to pay all or part of the expenditures for medical assistance furnished under a state plan."" This includes private insurance. Section 433.136 also defines private insurer to include ""any commercial insurance company offering health or casualty insurance to individuals or groups (including both experience-related insurance contracts and indemnity contracts)."" Private insurers are required to comply with the Deficit Reduction Act of 2005 (DRA) and related state enactments.
Indemnity plans may include a variety of insurance policies such as accident, cancer/specified disease, dental, hospital confinement indemnity, hospital confinement sickness indemnity, hospital intensive care, long-term care, short-term disability, specified health event, and vision. An individualized review of the various policy terms would be necessary to determine if they should be considered a third party resource for purposes of Medicaid. If this review determines that the policy provides for payment of health care items and services, the policy is a third party resource and payments would be assigned to the Medicaid agency.
An indemnity policy may be designed to pay a cash benefit to policyholders, unless the policyholder chooses otherwise. The policy may state that these payments may be used to cover medical expenses or living expenses such as rent, child care, or groceries. However, the insurance company may condition payment upon the occurrence of a medical event. Whenever payments are linked to specific medical events, these payments should be considered third party payments. Thus, the state could seek to recover Medicaid payments from the policy benefits.
Where indemnity policies do not qualify as a third party resource, any payments made to a Medicaid beneficiary may be countable as income for Medicaid eligibility purposes.
Supplemental Links:
- This FAQ was released as part of a larger set. View the full set. (PDF, 252.32 KB)
FAQ ID:94026
SHARE URLWhat are the parameters of the Social Security Act related to the liability of health insurers and other third parties in paying for health care services provided to Medicaid beneficiaries?
The Social Security Act (the Act) generally requires health insurers and other third parties that are legally liable to pay for health care services received by Medicaid beneficiaries to pay for the services that are primary to Medicaid. However, state Medicaid agencies might mistakenly pay claims for which a third party may be liable, because they are not aware of the existence of other coverage.
The Deficit Reduction Act of 2005 (DRA) made a number of changes to title XIX of the Social Security Act intended to strengthen state Medicaid programs' ability to identify and collect from third party payers that are legally responsible to pay claims primary to Medicaid.
Specifically, section Eligibility and Enrollment Systems5 of the DRA amended section 1902(a) (25) of the Act:
- To clarify which specific entities are considered "third parties"" and "health insurers" that may be liable for payment and that cannot discriminate against individuals on the basis of Medicaid eligibility; and,
- To require that states pass laws requiring health insurers:
- To provide the state with the coverage, eligibility, and claims data needed by the state to identify potentially liable third parties, including, at a minimum, name, address, and ID number;
- To honor the assignment to the state of a Medicaid beneficiary's right to payment by insurers for health care items or services; and,
- Not to deny such assignment or refuse to pay claims submitted by Medicaid based on procedural reasons (e.g., the failure of the beneficiary to present his/her insurance card at the point of sale, or the state's failure to submit an electronic, as opposed to a paper, claim).
Supplemental Links:
- This FAQ was released as part of a larger set. View the full set. (PDF, 252.32 KB)
FAQ ID:94041
SHARE URLHow are "third parties" defined in the Social Security Act (the Act) and what changes did the Deficit Reduction Act of 2005 (DRA) make to that definition?
Section 1902(a)(25)(A) of the Act requires states to take all reasonable measures to ascertain the legal liability of "third parties" for health care items and services provided to Medicaid beneficiaries. The DRA did not change the definition of "third parties," but rather clarified the entities subject to the provisions of section 1902(a) (25) (A) and (G) of the Act. Section Eligibility and Enrollment Systems5(a) of the DRA amended section 1902(a)(25)(A) of the Act to clarify that the "third parties" subject to the provisions of 1902(a)(25) include: (1) selfinsured plans, (2) pharmacy benefits managers (PBM), and (3) other parties that are, by statute, contract, or agreement, legally responsible for payment of a claim for a health care item or service, including workers compensation, automobile insurance, and liability insurance plans. The DRA also replaced reference to "a health maintenance organization" with "a managed care organization" (MCO) in identifying the types of third parties to which the provisions of section 1902(a) (25) apply.
Section 1902(a) (25) (G) of the Act prohibits health insurers from taking an individual's Medicaid status into account in enrollment or payment decisions.
Supplemental Links:
- This FAQ was released as part of a larger set. View the full set. (PDF, 252.32 KB)
FAQ ID:94051
SHARE URLAre Pharmacy Benefits Managers (PBMs) and Third Party Administrators (TPAs) considered to be third party resources for purposes of Medicaid?
Yes. PBMs and TPAs are considered to be ""third parties,"" as clarified in section Eligibility and Enrollment Systems5(a) of the Deficit Reduction Act of 2005 (DRA)'s amendment of section 1902(a)(25)(A) of the Social Security Act.
PBMs, TPAs, and similar entities may not have financial liability for actual payment of claims, depending on the nature and extent of services to be performed for the health insurer, as specified in the contract. However, if the PBM or TPA performs claims review and payment authorization for another third party, the PBM or TPA is expected to provide information to the Medicaid program, so the program can determine which party is the primary payer, for the purpose of coordinating benefits for the Medicaid beneficiary.
State law enacted to implement section Eligibility and Enrollment Systems5(a) of the DRA must require the health insurer that contracts with a PBM, TPA, or other such entity to administer the plan to provide the contracted entity with such information as may be necessary to enable that entity to furnish the state with information about when Medicaid beneficiaries may be (or may have been) covered by the health insurer, the nature of the coverage, and other necessary information.
Supplemental Links:
- This FAQ was released as part of a larger set. View the full set. (PDF, 252.32 KB)
FAQ ID:94056
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