The Michigan Department of Health and Human Services (MDHHS) recently released a proposed policy to establish additional Medicaid reimbursement for certain medically necessary drugs and therapeutics when provided in the inpatient hospital setting. The policy, pending approval by the Centers for Medicare & Medicaid Services, proposes to establish separate payment for drugs and therapeutics that are carved out of the diagnosis related group (DRG) in addition to providing the inpatient DRG payment. Payment would be made under Medicaid fee-for-service (FFS) for beneficiaries covered under both FFS and managed care plans with no beneficiary copayment.
The MDHHS publishes and maintains a list of applicable drugs and therapeutics. The payment rates for drug and therapeutic reimbursement are outlined in the Michigan Medicaid State Plan with these drugs and therapeutics covered as either professional claims or pharmacy claims as specified in the policy.
The provider must request prior authorization (PA) if the drug or therapeutic is purchased directly through a pharmacy, distributor or wholesaler. PA requests may be submitted either via Direct Data Entry through the Community Health Automated Medicaid Processing System or via fax.
Hospitals are encouraged to review the proposed policy and submit comments to MDHHS by March 5, 2024. Members with questions should contact Vickie Kunz at the MHA.