Earlier this year, this column discussed the fact that the Competitive Acquisition Program (CAP) was probably going to be implemented after the federal government and the Centers for Medicare & Medicaid Services changed the base rules on the purchase of drugs by a CAP vendor (Urology Times, February 2006). It was announced that the program would start on July 1, 2006.
Further, CMS indicated that prior to the sign-up date, which would begin on April 3, 2006, a list of CAP vendors would be published.
The time came and went. On April 17, CMS published a vendor list of one.
Rumor has it that after the change in the rules eliminating vendors purchasing drugs as related to the CAP in November, six companies applied to be CAP vendors. Of the six, five were approved.
After reviewing the contract, four dropped out, leaving one vendor.
On April 17, CMS announced that the CAP would begin July 1, 2006, as previously stated. The CMS announcement of the new vendor, BioScrip, was published on April 21, 2006.
At the same time, CMS indicated that the sign-up would begin later in the spring.
What went wrong?
First and foremost, the law specifically stated that each physician in each area would have a choice of at least two vendors. This is not the case. Also, as of the finalization of this article, we have not seen a contract that will be signed between the physician and the CAP vendor.
CMS and Congress have stated that their intent is to allow physicians to have their drugs furnished for their patients by a vendor without having to worry about purchasing or collecting payment for the drugs administered. However, they have created a program in which you, in essence, have hired a surrogate biller. It is true that you do not have to write a check for the drug, nor do you have to collect for it, but you are still involved in the process. You’re just not paid for your assistance in collecting for the drug. You will continue to bill for and be paid for the injection fee and any E&M services provided.
How the system works –
- First, physicians will have to sign up for the CAP program, if they choose to participate, during the sign-up period.
- Those physicians who choose to participate will sign a contract with the vendor initially for 6 months (between July 1, 2006 and Dec. 31, 2006). If a physician wishes to continue to participate after Dec. 31, he will be required to sign up for the next calendar year during an annual sign-up period each fall between October and mid-November.
- The participants will be required to acquire all drugs that can be provided by the vendor for their Medicare patients through the CAP.
- When a Medicare patient is scheduled to return for administration of a drug in a CAP-contracted physician’s office, the office is required to pre-order the drug through BioScrip. All patient information, including both primary and secondary insurance information as well as guarantor information, must be provided and/or updated with the order.
- When that patient returns to the office, the drug is administered. Billing for the injection and the drug, including the lot/prescription number of the drug, must be sent from the office within 14 days of the injection. Any services other than the drug or its administration that are provided on the same day (eg, office visits) must be billed on a separate claim.
- If the patient does not come to the appointment, this drug has to be returned to BioScrip, or the drug must be “relabeled” for another patient. Patients who require drugs on an emergency basis that fall under the CAP-required provision can be provided drugs from physician stores. Process for reimbursement should be spelled out in the CAP vendor program.
- CAP participants will be required to assist BioScrip in collecting from the patient or from the insurance companies to a degree specified in the contract.
- CAP participants will still be required to continue to purchase and bill for drugs for their private patients and for some drugs not yet included on the CAP vendor program.
BioScrip will outline specific policies in the contract signed by CAP participants. Under current policy, the vendor is required to:
- send you the drug when ordered, specific for that patient
- work with you to recycle the drug if the patient does not show
- collect from Medicare after the claim from the provider is processed and, when the claim is paid, bill any and all co-insurance for the patient, or bill the patient or other guarantor any balances due.
BioScrip is permitted to:
- pressure contracted providers to use a lower-priced drug if you are not using the least costly
- refuse to continue to supply drugs for a patient who cannot or will not pay their co-payment.
Read contracts carefully
As the saying goes, “The devil is in the details.”
By the time you read this article, BioScrip model contracts will be available. Obviously, the detail of the contract will provide more specific answers as to how the CAP vendor program will work. Remember that CAP participation is a 6-month commitment with very few outs for the remainder of this year. All of your Medicare Part B patients will be affected by your decision to participate or not.
Before participating, read the contract carefully and understand the details. Certainly, the decision is a personal one, with many factors that have to be taken into consideration.
If you decide not to participate in the CAP, you can continue to provide drugs in your office under Medicare Part B, as you have for years. Obviously, the profit margins for provision of these drugs in your office have changed in the past 2 years.
We realize there has been some discussion about the possibility of losing money when you’re buying and selling pharmaceuticals under the average sales price plus 6% reimbursement due to the expenses related to provision of the drug. While the prospect of monetary losses is possible, our calculations currently point to increased administrative expenses without increased reimbursement under the CAP, and, more important, a further loss in direct control of patient therapy. Therefore, we still think it is in the best interest of your patients and your practice not to participate in the CAP.
Instead, we would like to recommend that you establish a relationship with a pharmaceutical company that will treat you fairly in contracting. With fair contracting, properly managed inventory, and accurate billing, you will be able to buy and provide drugs to your patients without losing money.
In addition, many of the pharmaceutical companies are taking steps to make it easier for you to track your inventory and your reimbursement so that you can be assured that you are making good business decisions in your contracting.
As we travel around the country and ask the question in seminar after seminar, we find very few urologists intend to sign up to participate in the CAP. We are as interested as you in seeing how it works and if it will be of value. We wish you luck with the decision you make.
Urologist Ray Painter, MD, is president of Physician Reimbursement Systems, Inc., in Denver and is also publisher of Urology Coding and Reimbursement Sourcebook
Mark Painter is CEO of PRS Urology SC in Denver.
Disclaimer:
The information in this column is designed to be authoritative, and every effort has been made to ensure its accuracy at the time it was written. However, readers are encouraged to check with their individual carrier or private payers for updates and to confirm that this information conforms to their specific rules.
