How to Bill Medicare for Self-Administered Drugs

This guide aims to demystify the steps involved in billing Medicare for self-administered medications, providing a clear pathway for beneficiaries seeking reimbursement. This article will walk through the stages, from understanding what Medicare covers to interpreting claim decisions.

Medicare Coverage for Self-Administered Drugs

Medicare’s coverage for self-administered drugs distinguishes between medications typically taken at home and those administered in a clinical setting. Generally, most self-administered prescription drugs fall under Medicare Part D, which is your prescription drug coverage. Part D plans are offered by private insurance companies approved by Medicare and feature formularies. These plans involve various cost-sharing elements, including deductibles, co-pays, and co-insurance, and may also include a coverage gap, sometimes referred to as the “donut hole.” Coverage under Part D typically requires obtaining the drug from an in-network pharmacy.

Medicare Part B, which is medical insurance, covers a more limited scope of self-administered drugs. This part of Medicare primarily covers drugs administered by a healthcare professional in a doctor’s office or hospital outpatient setting, or certain drugs that cannot be self-administered. Specific types of self-administered drugs may be covered by Part B if they are medically necessary and meet certain criteria. For instance, Part B may cover certain injectable drugs, such as clotting factors for hemophilia patients who self-administer them, or immunosuppressant drugs for transplant patients if they were enrolled in Medicare Part A at the time of their transplant. Additionally, specific oral anti-cancer drugs can be covered under Part B if they are used as a full therapeutic replacement for an intravenous anti-cancer drug.

In hospital outpatient settings, self-administered drugs are generally not covered by Part B, as these are medications a patient would typically take on their own for ongoing conditions like blood pressure or diabetes. If a beneficiary receives a self-administered drug in such a setting that is not covered by Part B, the hospital might bill them directly for it. In these situations, a beneficiary’s Part D plan may offer coverage, though they might need to pay upfront and seek reimbursement from their Part D plan, especially since many hospital pharmacies do not participate in Part D networks. Confirm with the provider or plan whether a specific drug is covered under Part B or Part D.

Gathering Required Information and Documentation

Before submitting a claim, beneficiaries must gather specific information and documentation. A comprehensive collection of records is necessary to demonstrate medical necessity and proof of purchase. This includes the original prescription from the prescribing physician. Medical records, such as diagnosis codes and the treatment plan, are important to substantiate medical necessity.

Proof of purchase comes from itemized receipts from the pharmacy or provider. These receipts should clearly display the drug’s name, dosage, the total cost, and the date of purchase or service. Receipts should also include the National Drug Code (NDC), an 11-digit universal identifier for medications. This code, found on the drug container, identifies the manufacturer, product, and package size, and is crucial for proper billing.

Key information required for any claim form includes the beneficiary’s Medicare number. If the drug was administered or prescribed by a healthcare provider, their National Provider Identifier (NPI) may also be necessary. The drug’s specific dosage, purchase or administration date, and exact out-of-pocket amount are also needed. Beneficiaries generally use the CMS-1490S form for direct claims. Ensuring all these details are complete and accurate on supporting documents will streamline the claims process.

Submitting Your Medicare Claim

Once information and documentation are gathered, submit the Medicare claim. While healthcare providers and pharmacies typically handle billing directly to Medicare Part B or Part D, beneficiaries may sometimes need to submit a claim themselves. For direct submission by a beneficiary, the Patient’s Request for Medical Payment form, known as CMS-1490S, is the appropriate document.

To submit a paper claim using the CMS-1490S form, beneficiaries must complete all relevant sections of the form and attach itemized bills and any other supporting documents. Make copies of all submitted materials for personal records before mailing. Send the completed form and attachments to the correct Medicare Administrative Contractor (MAC) for your region. Mailing addresses are typically provided with the CMS-1490S form instructions. Beneficiaries should allow at least 60 days for Medicare to receive and process the request.

In many situations, especially for drugs covered under Part D, the pharmacy or the prescribing physician’s office will handle the billing directly to Medicare or the Part D plan. For drugs administered in a clinical setting and covered by Part B, the provider’s office usually submits the claim on the beneficiary’s behalf. In such cases, the beneficiary’s role involves providing all required personal and insurance information to these entities to ensure proper and timely submission. Maintain a complete record of all documents provided, along with the date of submission.

Understanding Claim Decisions and Next Steps

After a Medicare claim is submitted, beneficiaries receive a Medicare Summary Notice (MSN) for services covered under Original Medicare (Parts A and B). This notice, sent every three to four months, is not a bill but provides a detailed summary of services or supplies billed to Medicare, what Medicare paid, and the maximum amount the beneficiary may owe. The MSN also explains if a claim was denied and provides instructions on how to appeal the decision. For beneficiaries enrolled in Medicare Advantage or Part D plans, an Explanation of Benefits (EOB) from their private insurer serves a similar purpose.

Review the MSN or EOB to identify any discrepancies or denials. Common reasons for claim denials include the service or drug not being deemed medically necessary, not being covered under the specific Medicare part, or missing information on the claim. If a claim is denied, contacting the doctor’s office or provider can help determine if incorrect information was submitted, allowing them to resubmit the claim.

If a beneficiary disagrees with a denial, they have the right to appeal Medicare’s decision through a multi-level process. The first level of appeal is a Redetermination by a Medicare Administrative Contractor, which must be filed within 120 days of the date on the MSN. If the redetermination is unfavorable, the next step is a Reconsideration by a Qualified Independent Contractor (QIC), filed within 180 days of the redetermination notice. Subsequent levels include a hearing before an Administrative Law Judge (ALJ), review by the Medicare Appeals Council, and judicial review in a U.S. District Court, each with specific deadlines and, for higher levels, a minimum amount in controversy. Throughout this process, keep copies of all correspondence and adhere to deadlines.