T EX A S M E D I C A I D P R OV I D E R P RO CE D U RE S M A N U A L : V OL . 1 - J A N U A R Y 2 0 1 5
APPENDIX B: VENDOR DRUG PROGRAM
B.1 Vendor Drug Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-2
B.1.1 VDP Benefits for Medicaid Fee-for-Service (FFS) Clients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-2
B.1.2 VDP Formulary Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-3
B.1.3 Obtaining Outpatient Prescribed Drug Prior Authorization for FFS Clients . . . . . . . . . . . . B-3
B.1.4 Dispensing Life of Prescriptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-3
B.1.5 National Drug Code (NDC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-4
B.1.6 VDP Contact Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-4
B.1.7 72-Hour Emergency Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-4
B.1.8 Cost Avoidance Coordination of Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-4
B.1.9 Schedule II Controlled Substances (CII) through Schedule V Controlled
Substances (CV) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-5
B.1.9.1 Tamper-Resistant Prescription Pads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-5
B.1.10 Requirements for Early Refills of Certain Drugs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-5
B.1.11 Free Delivery of Medicaid Prescriptions for FFS Clients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-6
B.1.12 Delivery of Medicaid Prescriptions for MCO Clients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-6
B.1.13 Pharmacies Can Dispense Limited Home Health Supplies (LHHS) to Medicaid Clients . B-6
B.1.14 Vitamin and Mineral Products. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-7
B.2 Medicaid Children’s Services Comprehensive Care Program (CCP) Available for
Children and Adolescents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-7
B.3 Palivizumab (Synagis) Available Through the VDP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-7
B.3.1 Participating Palivizumab Distribution Pharmacies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-8
B-1
CPT ONLY - COPYRIGHT 2014 AMERICAN MEDICAL ASSOCIATION. ALL RIGHTS RESERVED.
TEXAS MEDICAID PROVIDER PROCEDURES MANUAL: VOL. 1 - JANUARY 2015
B.1 Vendor Drug Program
The Texas Medicaid Vendor Drug Program (VDP) makes payment for prescriptions of covered outpatient drugs to those pharmacy providers contracted with the VDP. In-state pharmacies licensed as Class
A or C by the Texas State Board of Pharmacy are eligible for enrollment in the VDP. Out-of-state
pharmacies and pharmacies holding any other class of pharmacy license are considered for inclusion in
the program on a case-by-case basis, relative to the benefits made available to a client eligible for Texas
Medicaid. Contracts are not granted to applicants unless additional benefits to the recipient are
established.
VDP provides statewide access to prescription drugs as prescribed by treating physician or other healthcare provider for clients eligible for:
• Medicaid fee-for-service
• Children with Special Health Care Needs (CSHCN) Services Program
• Kidney Health Care (KHC)
VDP manages drug formulary for Children’s Health Insurance Program (CHIP).
VDP remains responsible as claims processor for Medicaid fee-for-service (FFS) clients and
management of Medicaid drug formulary and preferred drug list.
Note: Pharmacy services rendered to Medicaid managed care clients are administered by the
clients’ managed care organizations (MCOs).
Refer to: Medicaid Managed Care Handbook (Vol. 2, Provider Handbooks) for additional information about managed care prescription drug and pharmacy benefits.
B.1.1 VDP Benefits for Medicaid Fee-for-Service (FFS) Clients
The Medicaid drug benefit for Medicaid FFS clients is limited to three prescriptions per month with the
following exceptions that have unlimited prescriptions:
• Clients enrolled in waiver programs such as Community Living Assistance (CLASS) and
Community-Based Alternatives (CBA)
• Texas Health Steps (THSteps)-eligible clients (clients who are 20 years of age and younger)
• Clients in skilled nursing facilities
Note: Prescriptions for family planning drugs and supplies are not subject to the three-prescription
limit.
The following categories of drugs do not count against the three prescription per month limit:
• Family planning drugs
• Smoking cessation drugs
• Insulin syringes
FFS clients can be “locked-in” to a specific pharmacy. FFS clients who are “locked-in” to a primary-care
pharmacy have “Lock-in” printed on their Your Texas Benefits Medicaid card. Clients who are not
“locked-in” to a specific pharmacy may obtain their drugs or supplies from any contracted Medicaid
provider of pharmaceutical services.
Refer to: Subsection 4.4.2, “Client Lock-in Program” in Section 4, “Client Eligibility” (Vol. 1, General
Information) for more information about lock-in limitations.
B-2
CPT ONLY - COPYRIGHT 2014 AMERICAN MEDICAL ASSOCIATION. ALL RIGHTS RESERVED.
APPENDIX B: VENDOR DRUG PROGRAM
Family planning services are excluded from lock-in limitation. Though TMHP reimburses family
planning agencies and physicians for family planning drugs and supplies, the following family planning
drugs and supplies are also available through the VDP and are not subject to the three-prescription limit:
• Oral contraceptives
• Long-acting injectable contraceptives
• Vaginal ring
• Hormone patch
• Certain drugs used to treat sexually transmitted diseases (STD’s)
Refer to: The VDP website at www.txvendordrug.com/formulary/TWH-search.asp for more
information.
The VDP does not reimburse claims for nutritional products (enteral or parenteral), medical supplies,
or equipment other than limited home health supplies (LHHS).
B.1.2 VDP Formulary Information
VDP drug formulary information is available to health-care providers to help their clients efficiently get
their medications. Information includes which state health-care program covers the drug, whether a
drug is on the Medicaid Preferred Drug List (PDL), whether a Medicaid non-preferred prior authorization or clinical prior authorization is required, and other important drug information. VDP drug
formulary information is available:
• Online at www.txvendordrug.com (All state health-care program formulary information with prior
authorization type (PDL or clinical) required indicator)
• Online at www.txvendordrug.com/formulary/enhanced-form-search.shtml. Here providers can
find Medicaid drug formulary and PDL information with links attached to selected non-preferred
drugs that will guide providers to the preferred drugs in that therapeutic class.
• Providers are eligible to register for Epocrates, which is a free drug information service that can be
downloaded to the provider's mobile device. In addition to listing a drug’s preferred status,
Epocrates includes drug monographs, dosing information, and warnings. For more information, go
to www.epocrates.com.
B.1.3 Obtaining Outpatient Prescribed Drug Prior Authorization for FFS
Clients
To obtain prior authorization for any VDP medication for FFS clients, prescribing providers or their
representatives should call the Texas Prior Authorization Hotline at 1-877-PA-TEXAS
(1-877-728-3927). The Hotline is available Monday through Friday, 7:30 a.m. to 6:30 p.m. Central Time.
To submit an online VDP prior authorization request for non-preferred drugs, prescribing providers
must first register online at https://paxpress.txpa.hidinc.com. For Synagis prior authorization, see
subsection B.3, “Palivizumab (Synagis) Available Through the VDP” in this appendix.
Note: Pharmacists cannot obtain prior authorization for medications. If the client arrives at the
pharmacy without prior authorization for a non-preferred drug, the pharmacist will alert the
provider’s office and ask the provider to get prior authorization.
B.1.4 Dispensing Life of Prescriptions
Medicaid prescriptions for noncontrolled substances are valid one year and up to 11 refills if authorized
by prescriber.
Medicaid prescriptions for controlled substances in drug classes C3-C5 are valid for six months and up
to 5 refills if authorized by prescriber provider.
B-3
CPT ONLY - COPYRIGHT 2014 AMERICAN MEDICAL ASSOCIATION. ALL RIGHTS RESERVED.
TEXAS MEDICAID PROVIDER PROCEDURES MANUAL: VOL. 1 - JANUARY 2015
Medicaid prescriptions controlled substances in C2 drug class have no refills and must be dispensed
within 21 days of the date on which the prescription was written.
Refer to: VDP Pharmacy Provider Procedure Manual at txvendordrug.com/downloads/index.asp.
Texas State Board of Pharmacy website at www.tsbp.state.tx.us/rules/for rules about
issuance of identical sets of C2 prescriptions.
B.1.5 National Drug Code (NDC)
All Texas Medicaid providers must submit a rebateable NDC for professional or outpatient claims
submitted to TMHP with a physician-administered prescription drug procedure code.
The NDC is an 11-digit number on the package or container from which the medication is administered.
Providers must enter modifier N4 before the NDC code on all professional or outpatient claims that are
submitted to TMHP.
Note: Procedure codes in the A-code series do not require an NDC on claims that are submitted to
TMHP.
A list of drugs that require an NDC for Texas Medicaid reimbursement is available on the TMHP
website at www.tmhp.com under the Topics section. Physician-administered drugs that do not have a
rebateable NDC will not be reimbursed by Texas Medicaid.
Refer to: Subsection 6.3.4, “National Drug Code (NDC)” in Section 6, “Claims Filing” (Vol. 1,
General Information) for additional information on claims filing using NDC.
B.1.6 VDP Contact Information
Vendor Drug Area
Telephone Number
Covered outpatient drugs and billing: The 800 number is for pharmacy use 1-800-435-4165
only and can be used to reach anyone in the VDP.
Pharmacy contracts
(512) 462-6317
Program management
(512) 707-6119
Policy
(512) 707-6108
Field administration
(817) 563-3922
Drug formulary (Texas listing of national drug codes)
(512) 462-6390
Texas Prior Authorization Center Hotline
1-877-728-3927
B.1.7 72-Hour Emergency Supply
Federal and Texas law requires that a 72-hour emergency supply of a prescribed drug be provided when
a medication is needed without delay and prior authorization is not available. This rule applies to nonpreferred drugs on the Preferred Drug List (PDL) and any drug that is affected by a clinical prior authorization edit and needs the prescriber’s prior approval. Some preferred drugs on the Medicaid formulary
may also be subject to clinical edits that require additional prior authorization. Drugs not on the PDL
may also be subject to clinical edits.
Refer to: VDP website at www.txvendordrug.com/pdl/72hour.shtml.
B.1.8 Cost Avoidance Coordination of Benefits
Cost avoidance coordination of benefits (COB) for pharmacy claims ensures compliance with the
Centers for Medicare & Medicaid Services (CMS) regulations. Under federal rules, Medicaid agencies
must be the payer of last resort. The cost avoidance model checks for other known insurance at the point
of sale, preventing Medicaid from paying a claim until the pharmacy attempts to obtain payment from
the client’s third party insurance.
B-4
CPT ONLY - COPYRIGHT 2014 AMERICAN MEDICAL ASSOCIATION. ALL RIGHTS RESERVED.
APPENDIX B: VENDOR DRUG PROGRAM
Refer to: VDP Pharmacy Provider Procedure Manual at txvendordrug.com/downloads/index.asp.
B.1.9 Schedule II Controlled Substances (CII) through Schedule V Controlled
Substances (CV)
Pharmacies must report all CIII, CIV, and CV prescriptions to the Texas Department of Public Safety
(DPS) in addition to the CII prescriptions that are already being reported. This DPS process requires
reporting by the DPS registration number of the practitioner issuing the prescription. The prescription
forms for Schedule CII controlled substances that are issued by the Texas Department of Public Safety
(DPS) under the Texas Prescription Program meet the baseline standards set forth above.
Refer to: The DPS website at www.txdps.state.tx.us/RegulatoryServices/narcotics/narccsr.htm.
B.1.9.1 Tamper-Resistant Prescription Pads
Providers are required by federal law (Public Law 110-28) to use a tamper-resistant prescription pad
when writing a prescription for any drug for Medicaid clients. Pharmacies are required to ensure that all
written Medicaid prescriptions submitted for payment to the VDP were written on a compliant tamper
resistant pad.
CMS has stated that special copy-resistant paper is not a requirement for electronic medical records
(EMRs) or ePrescribing-generated prescriptions. These prescriptions may be printed on plain paper and
will be fully compliant if they contain at least one feature from each of the following three categories:
• Prevents unauthorized copying of completed or blank prescription forms
• Prevents erasure or modification of information written on the prescription form
• Prevents the use of counterfeit prescription forms
Two features that can be incorporated into computer-generated prescriptions printed on plain paper to
prevent passing a copied prescription as an original prescription are as follows:
• Use a very small font that is readable when viewed at 5x magnification or greater and illegible when
copied.
• Use a “void” pantograph accompanied by a reverse “Rx,” which causes a word such as “Void” to
appear when the prescription is photocopied.
Refer to: VDP Pharmacy Provider Procedure Manual at txvendordrug.com/downloads/index.asp.
B.1.10 Requirements for Early Refills of Certain Drugs
Medicaid fee-for-service and the Children with Special Health Care Needs (CSHCN) Services Program
clients must exhaust 90 percent of the prescribed of certain controlled substances, including tramadol,
before a Medicaid Vendor Drug Program (VDP)- enrolled pharmacy may refill a prescription or fill a
new prescription for the same drug.
Note: Some drugs, such as attention deficit hyperactivity disorder drugs and certain seizure medications, are excluded from this change.
The 90% Utilization Drug List, which contains a complete list of the affected drugs, is available in the
Downloads section of the VDP website at www.txvendordrug.com.
Justifications for early refills include, but are not limited to, the following:
• A verifiable dosage increase
• An anticipated prolonged absence from the state
B-5
CPT ONLY - COPYRIGHT 2014 AMERICAN MEDICAL ASSOCIATION. ALL RIGHTS RESERVED.
TEXAS MEDICAID PROVIDER PROCEDURES MANUAL: VOL. 1 - JANUARY 2015
If a client requests an early refill of a drug on the VDP list, the dispensing pharmacy must contact the
VDP Pharmacy Resolution help desk to request an override of the early refill restriction. Prescribing
providers may be asked to verify the reason for the early refill by the dispensing pharmacy or VDP staff.
Note: Providers who are members of Medicaid managed care plans should contact the appropriate
managed care organization (MCO) and/or Pharmacy Benefit Manager for specific requirements and processes related to dispensing early refills.
B.1.11 Free Delivery of Medicaid Prescriptions for FFS Clients
Many Medicaid pharmacies across the state offer free delivery of prescriptions to Medicaid FFS clients.
To find out which pharmacies offer home delivery, refer FFS clients to the HHSC website at
www.txvendordrug.com/delivery-pharmacies.pdf. Contracted Medicaid pharmacy providers are
reimbursed a delivery fee that is included in the medication dispensing fee formula. The delivery fee is
paid to HHSC-approved pharmacy providers that have certified that delivery services meet minimum
conditions for payment of the delivery fee.
The conditions include:
• Making deliveries to individuals rather than to institutions, such as nursing homes.
• Offering no-charge prescription delivery to all Medicaid clients who request it in the same manner
as to the general public.
• Displaying publicly the availability of prescription delivery services at no charge in a prominent
place in the pharmacy store (window or door).
• Providing the delivery service without requiring retention of the Your Texas Benefits Medicaid card.
This delivery fee is not applicable for mail-order prescriptions.
For more information, call the Vendor Drug Resolution Help Desk at 1-800-435-4165 and ask for
Pharmacy Contracts.
B.1.12 Delivery of Medicaid Prescriptions for MCO Clients
Medicaid and CHIP MCOs pay local pharmacies to deliver pharmaceuticals to clients. Each MCO
develops its own participating pharmacy network for this delivery service. Pharmacies that are interested
in receiving payment for the delivery of pharmaceuticals to MCO clients should contact their MCOs to
request information on how to apply.
The VDP website at www.txvendordrug.com has several managed care expansion resources for
pharmacies. The Enrollment Chart at www.txvendordrug.com/downloads/enrollment_chart.pdf
includes the pharmacy contract phone number for each MCO.
B.1.13 Pharmacies Can Dispense Limited Home Health Supplies (LHHS) to
Medicaid Clients
Pharmacies that are enrolled with VDP can dispense LHHS that are commonly found in a pharmacy to
fee-for-service Medicaid clients. Pharmacies can also dispense LHHS to clients who are enrolled in a
Medicaid MCO if the pharmacy is enrolled in the client’s MCO.
The home health supplies that can be dispensed include the following:
• Diabetic insulin syringe with needle 1 cc or less
• Diabetic insulin needles
• Diabetic blood glucose test strips
• Diabetic lancets
• Spring-powered device for lancet
• Home glucose disposable monitor (includes test strips)
B-6
CPT ONLY - COPYRIGHT 2014 AMERICAN MEDICAL ASSOCIATION. ALL RIGHTS RESERVED.
APPENDIX B: VENDOR DRUG PROGRAM
• Talking diabetic blood glucose monitors
• Aerosol holding chamber
• Oral electrolytes
• Hypertonic saline solution
Claims are subject to post-payment desk reviews to ensure claims from durable medical equipment
(DME) providers and pharmacies do not result in either a client who exceeds the maximum quantity or
a duplicate payment from HHSC for the same client and LHHS.
More information about the provision of these supplies through a fee-for-service pharmacy can be
found on the VDP website at www.txvendordrug.com/formulary/limited-hhs.shtml.
Providers should contact the appropriate MCO or pharmacy benefit manager for more information
about providing these supplies to Medicaid clients who are enrolled in a Medicaid managed care plan.
B.1.14 Vitamin and Mineral Products
Pharmacies that are contracted with VDP can dispense some vitamin and mineral products to Texas
Medicaid fee-for-service clients who are 20 years of age and younger. Pharmacies can also dispense these
covered vitamin and minerals products to clients who are enrolled in a Medicaid MCO, if the pharmacy
is enrolled in client’s MCO.
VDP-contracted pharmacies can honor a physician’s prescription for covered vitamins and minerals. To
help expedite pharmacy claim processing, prescribing providers are encouraged to include the diagnosis
on the prescription.
VDP-contracted pharmacies are required to be enrolled with TMHP or have a CCP Prior Authorization
Request Form to fill a prescription unless they intend to submit claims to TMHP instead of VDP.
VDP-contracted pharmacies that are not enrolled with TMHP may submit claims for vitamin or mineral
products to VDP.
Claims are subject to post-payment desk reviews to ensure claims from DME providers and pharmacies
do not result in duplicate payments for the same client or vitamin and mineral and to validate that
prescribed products are appropriate for the client’s medical condition.
More information about the provision of these products and list of products for fee-for-service clients
can be found on the VDP website at www.txvendordrug.com/formulary/formulary/VitaminsMinerals.shtml.
B.2 Medicaid Children’s Services Comprehensive Care Program
(CCP) Available for Children and Adolescents
Medically necessary drugs and supplies that are not covered by the VDP may be available to children
and adolescents (birth through 20 years of age) through the CCP (i.e., some over the counter drugs,
nutritional products, diapers, and disposable or expendable medical supplies).
The Prior Authorization fax number is (512) 514-4212.
Refer to: Subsection 2.6.1.1, “Pharmacies (CCP)” in the Children’s Services Handbook (Vol. 2,
Provider Handbooks) for more information about pharmacy enrollment in CCP.
B.3 Palivizumab (Synagis) Available Through the VDP
Palivizumab is available to physicians for administering to Medicaid clients only through the VDP. This
option enables physicians to have palivizumab shipped directly to their office from a network pharmacy.
Physicians will not need to purchase the drug. Physicians who obtain palivizumab through the VDP may
not submit claims to Medicaid (TMHP) for the drug.
B-7
CPT ONLY - COPYRIGHT 2014 AMERICAN MEDICAL ASSOCIATION. ALL RIGHTS RESERVED.
TEXAS MEDICAID PROVIDER PROCEDURES MANUAL: VOL. 1 - JANUARY 2015
The administering provider may submit a claim to TMHP for an injection administration fee and any
medically necessary office-based evaluation and management service provided at time of injection.
For more information, refer to the HHSC Vendor Drug Synagis Program page at
www.txvendordrug.com/dur/synagis.shtml.
B.3.1 Participating Palivizumab Distribution Pharmacies
For a list of participating pharmacies, refer to the HHSC Vendor Drug website at
www.txvendordrug.com/dur/synagis.shtml.
Palivizumab forms are updated every year. Providers must use the most current version of the forms to
submit prior authorization requests.
The Texas Medicaid/CHIP Vendor Drug Program Fee-For-Service Medicaid Synagis® Request Form for
2014-15 Season is required when the prescribing provider obtains the drug through VDP.
Note: Palivizumab is also be available to Children with Special Health Care Needs (CSHCN)
Services Program clients. Providers can refer to the CSHCN Services Program Provider
Manual for details.
Refer to: Texas Medicaid/CHIP Vendor Drug Program Fee-For-Service Medicaid Synagis® Request
Form on the VDP website.
B-8
CPT ONLY - COPYRIGHT 2014 AMERICAN MEDICAL ASSOCIATION. ALL RIGHTS RESERVED.