2018 Session

Budget Amendments - HB30 (Member Request)

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Chief Patron: Stolle
Implement a Drug Outlier Reimbursement Policy for Outpatient Hospital Services

Item 303 #15h

Item 303 #15h

First Year - FY2019 Second Year - FY2020
Health and Human Resources
Department of Medical Assistance Services FY2019 $816,172 FY2020 $816,172 GF
FY2019 $816,172 FY2020 $816,172 NGF

Page 257, line 34, strike "$10,983,034,643" and insert "$10,984,666,987".
Page 257, line 34, strike "$12,657,131,076" and insert "$12,658,763,420".

Page 278, after line 4, insert:

"PPP.  Effective July 1, 2018, the Department of Medical Assistance Services shall amend the State Plan for Medical Assistance to implement an outlier reimbursement policy for high cost drugs in the outpatient hospital setting that will pay 76 percent of drug costs in excess of a threshold that is 10 percent more than the highest reimbursement for drugs under EAPG after grossing up the reimbursement amount for the full cost.  At rebasing, the department shall exclude drug costs in the base data that meet this criterion.  The department shall have the authority to implement these reimbursement changes effective July 1, 2018, and prior to the completion of any regulatory process undertaken in order to affect such changes."


(This amendment provides authority and funding to amend Medicaid outpatient hospital reimbursement methodology to reimburse for new types of covered drugs. For newer high cost drugs that must be provided in a hospital outpatient setting, the current Medicaid reimbursement structure is not designed to fairly compensate hospitals for the administration of these drugs. For drugs that must be administered in an outpatient hospital setting, current DMAS regulations require that the hospital be reimbursed according to Medicaid’s outpatient reimbursement methodology. If these drugs are paid as pharmacy claims, the reimbursement would be much higher.)