Nursing Facility Medicare Part D Questions

Please note, that while Medicare Part D is a federal program, not a state program, nursing facilities have been asking questions about the Medicare D Program as it relates to the Medical Assistance (MA) program. The following questions and answers were prepared to provide answers to the questions received.

Drug Deduction:

1. Once a resident in a nursing facility or their guardian goes through the appeal process for a drug exception and is still denied, can the non-covered drug be deducted from the nursing facility invoice as OME?

Response: No. Medicare is responsible for all medically necessary drugs. If the appeals process determines a drug is not medically necessary thru the Medicare Part D appeals process, MA will not cover the drug and it cannot be deducted as a drug deduction (value code 25) OME.

2. Who would pay for a drug if the doctor states it is medically necessary and it was denied through the appeals process and the doctor won’t change to a different prescription?

Response: Once a drug has been determined not medically necessary through the Medicare appeals process, the resident would be responsible for payment. A provider may bill a MA recipient for a noncompensable service or item if the recipient is told before the service is rendered that the program does not cover it. 

3. Are there any instances when we will see drug deductions as an OME and what are they?

Response: Vitamin B-12 may be used as a drug deduction. Residents will still be able to get certain drugs with their ACCESS card. Your pharmacy may bill MA directly for these drugs. The types of drugs that the ACCESS card will cover are:

  • Barbiturates like Phenobarbital
  • Benzodiazepines like Ativan
  • Some over-the-counter drugs like insulin supplies
  • Prescription vitamins and minerals like Folic Acid products, Vitamin D products, Vitamin K products

4. Is there a maximum premium that would be allowed as a deduction?

Response: No amount may be deducted. However, there are plans available without premiums.

Private Insurance:

5. If a resident does not want to enroll in Medicare Part D and wishes to get a private insurance that is not creditable coverage, can the premium be taken as an insurance deduction? Who is responsible for the co-payments and deductibles?

Response: Should the resident choose a private insurance, they would be responsible for co-payments and deductibles. The premium cannot be taken as an insurance deduction.