National Committee on Vital and Health Statistics (NCVHS)

Hearing on NCPDP Standards and Updates

March 26, 2018

Virtual Meeting


P R O C E E D I N G S     (9:00 a.m.)

HINES: Good morning. Thank you for joining us today. You have dialed into the National Committee on Vital and Health Statistics meeting of the Standards Subcommittee Hearing on NCPDP Standards Updates. If that is not where you want to be, find the other WebEx you meant to dial into.

My name is Rebecca Hines. I am the executive secretary and designated federal official for the committee. We are going to start off with roll call. Members, please make sure either on the WebEx or your local phone, your mute button is off. We will begin with our co-chair Alix Goss.

GOSS: Present

HINES: Nick Coussoule.

COUSSOULE: I am here.

HINES: Denise Love. Debra Strickland.


HINES: Linda Kloss. Rich Landen.

LANDEN: I am here.

HINES: Jacki Monson. I saw her name on the list. Bill Stead. Are there any other members I did not mention who are on? For CMS staff, I know that Lorraine Doo, who is our lead staff, and Geanelle Herring, her co-pilot lead staff are on the line and there are several other CMS staff with us this morning. Thank you for joining the subcommittee’s hearing.

For other guests, we would appreciate it you would enter your name and email in the chat box just to help us capture attendance. Is there anyone else member-wise or subcommittee who I missed?

Turning to logistics, I want to take a moment to review how the logistics of this WebEx hearing are going to work before turning over to Alix and Nick. For panelists, you will have between seven and eight minutes for your comments. Since we do not have visual cues, I will have to use a sound signal to let you know upfront. When you have one minute left, I will put a note in the chat box to let you know you have one minute left. That may be too many places to look. If you miss that, you may hear a bell. It sounds like that. That lets you know that your time is up. Please just wrap up. When the bell goes off that is eight minutes.

After each group of panelists presents, the subcommittee members will ask questions of the panelists and have discussion and we will have an opportunity for public comment at the end of the day. But if you cannot stay for the whole day, you are welcome to submit your comments two ways. Either into the chat box of the WebEx or by email. That is I will put that in the chat box at some point. Again, that is

If you have a question or comment during the day or at the end, you can also use the raised hand at the lower right corner of your screen to let the co-chairs know if you would like an opportunity to speak. If for reason you were scheduled to present, but you do not have the right dial in number, please contact Michele Dillon by email and I did put her information in the chat box this morning. But one more time, it is Please do not ask for technical support from CMS staff or myself because we cannot help you. Michele will be able to do that.

Finally, we would appreciate it if you would mute your phone if you are not speaking. Please whatever you do don’t put your phone on hold especially if you are working out of a corporate phone system because we will end up all listening to your corporate hold music and that would really not work so well. Please make sure – just put yourself on mute. Don’t put this line on hold because that could disrupt our proceedings.

Any questions from the subcommittee members or the panelists at this point? Nick, I will turn it over to you.

Agenda Item: Welcome and Introductions

COUSSOULE: Thanks Rebecca. Again, this is Nick Coussoule. I am one of the co-chairs of the Standard Subcommittee. I want to thank everybody that is here today as well as our subcommittee members. We have a good bit of time that we will be spending together today until roughly 3:30 this afternoon, hearing about the updated versions of the NCPDP retail pharmacy telecommunications standards of version F2 in the Subrogation Implementation Guide for Batch Standard version 10. We anticipate lots of good input from the presenters today and interactions with not just the panelists, but also the subcommittee members today in hopefully advancing this work for national adoption.

We will hear first from Alix Goss, my co-chair, with some welcoming comments. We will then have our first session. Again, we have a number of sessions, hearing from different portions of the industry from the pharmacies to the payers and PBMs and clearinghouses and then a little more detail on the subrogation standards later on this afternoon.

But with that said, as Rebecca indicated earlier also, each panelist will have time to speak and then we will close with questions for each of those from the subcommittee members. Again, we expect that to be a robust conversation.

At the end of the day, we will take public comments. We will not do that at the end of each presentation, but we have specific time carved out at the end of the day to do that. We will endeavor to stay on time. If we are pushing along a little bit, it is not to be rude. It is just to make sure we get to all the presenters and leave time for questions at the end.

With that said, Alix, do you want to take it from here?

GOSS: Thanks so very much Nick. Welcome everyone. We are really excited that you are all here with us virtually today to share your expertise about the NCPDP standard updates. We have a lot to learn from all of you. Before we dive into our topics, I would like to take a moment to thank NCPDP for bringing the new version of the standards forward through the Designated Standards Maintenance Organization or DSMO and for DSMO’s recommendations to NCVHS enabling us to take today’s steps.

As most of you know, this process of industry development, review, and public input has been part of the HIPAA standards adoption process since the program’s inception. It helps to ensure transparency and engagement in the process. Those of you who are here today virtually at any rate are critical to this endeavor. Input of the pharmacies, pharmacy benefit managers and processors, pharmacists, vendors, developers and state – it is a critical component to our development of relevant input and recommendations to the health secretary on upgrading a pharmacy-related standard.

Certainly, NCPDP knows what its stakeholders want through its robust work group process. But NCVHS has an important role to play in making its recommendations to HHS. And for that, we rely on a larger audience. We know you are all taking time away from your day to be here with us, to educate us in the significance of these standards updates, the costs and benefits.

We appreciate being able to hear the testimony of those presenting and thank you for your time and expertise in advance for your written and oral testimony.

With that opening, I would like to turn it back over to Rebecca so that we can go ahead and bring up the first document for presentation.

HINES: WebEx folks, there we go. That was great. We are good to go. Lorraine?

DOO: Great. Thank you. And echoing Alix and Nick, we wanted to thank everybody. Our first presenters for today are Margaret Weiker and Annette Gabel, representing the National Council on Prescription Programs and the Strategic National Implementation Planning Workgroup to discuss the history development of the updates to the standards and their proposal to NCVHS. Welcome Margaret and Annette. Please correct if I got the – naming right and I am sure you will. We have your presentation up for you. I guess Margaret and Annette, when you want the slides to move, just let us know.

Agenda Item: Background of Request for F2 and Subrogation

WEIKER: Thank you, Lorraine, and thank you, committee members. I am Margaret Weiker, director of Standards Development at the National Council for Prescription Drug Program. NCPDP is a not-for-profit, multi-stakeholder forum for developing and promoting industry standards and business solutions that improve patient safety and health outcomes by also decreasing cost.

The work of the organization accomplished through its members who bring expertise into perspective to the forum. As an ANSI-accredited, Standards Development Organization, NCPDP uses a consensus-building process to create national standards for real time electronic exchange of health care information. To our collaborative problem-solving forum, we also develop standardized best practices for product labeling, dosing instructions, patient education, and other practices important in safeguarding patients. Our data products developed by industry for industry help support the important work of our members.

In January of 2009, HHS adopted the Telecommunication Standard Implementation Guide Version D.0, the Batch Standard Implementation Guide Version 1.2, and the Batch Standard Medicaid Subrogation Implementation Guide Version 3.0 to support health care claims or encounters, eligibility referrals, certification authorization, coordination of benefits and Medicaid pharmacy subrogation transactions.

In October of 2010, HHS published a Maintenance Notification to correct errors in the Telecommunication Standard. In November of 2014, the NCPDP Workgroup 1 participants began discussing moving to a new version of the standards. Workgroup 1 in NCPDP is our telecommunication standard workgroup and they have responsibility for updating and maintaining the telecommunications standards about standard and the subrogation standard.

In February of 2015, the Workgroup 1 participants voted to bring forward the balloted version out of the August 2016 as the next HIPAA version. In August 2016, the Workgroup 1 participants voted to delay the next version to be adopted under HIPAA by six months. That would be the February 2017 version that was balloted.

In August of 2017, NCPDP submitted two DSMO requests. In January 2018, the DSMO sent a letter to NCVHS.

DSMO Request 1201 is the request to adopt an updated version of the Telecommunication Standard, which would be version F2 as well as the Batch Standard Implementation Guide, which would be version 15.

DSMO Request 1202 is a request for the membership to adopt the Subrogation Implementation Guide for that standard version 10. This request is to replace the Medicaid Subrogation Standard Implementation Guide Version 3.0 for Medicaid use only.

I want to call the members’ attention to the last paragraph where NCPDP is requesting approval of this request, the DSMO 1202, for the standard to be named in HIPAA for use by Medicaid agencies only.

Since the completion of version D.0, 21 new versions of the Telecommunication Standard have been published since the release of the Telecommunication version D.0 in July of 2007. These published versions are the results of 111 Data Element Request Forms or DERFs and 156 DERFs requesting changes to the NCPDP External Code List or ECL. 218 data elements have been added, 46 data elements have been sunset, 152 instances of existing data elements had values added, redefined or renamed, and 211 reject codes were added and 125 reject codes were sunset.

I will not go through all of the changes, but want to call attention to some of the more notable changes made to this standard.

We move to support the 8-digit IIN and removed the BIN. The IIN as well as the BIN is an ISO standard. In early 2017, they increased the length of the field from the existing six digits and converted them to the new eight-digit IIN. The registering authority for the United States because ISO is an international standard is ANSI. They began issuing eight-digit numbers as well.

NCPDP developed guidance around the eight-digit IIN and how to truncate it so it would fit into the BIN, which is six digits. Also, other related BIN fields have been changed as well.

Anywhere there was a capability to enter a product into our standard, which was increased to 40 characters primarily to support the UVI numbering system.

A new field – total prescribed quantity remaining was added for controlled substance use. This field allows the processor to identify the accumulated prescribed quantity remaining.

The situation for quantity prescribed was updated since version D.0. This is the same change that we have been asking for since 2012. And then we also added the Prescriber DEA Number to support the controlled substance claims and reporting.

A new field. Do Not Dispense Before Date was added to support providers writing multiple, one-month prescriptions for controlled substances as well as state requirements on the number of days a patient has to fill a controlled substance from the date written.

Due to the business need for other payers besides Medicare Part D to use benefit stages and to address supplemental payers and able to require Medicaid Part D benefits – information. We modified the benefit stage fields to allow usage by other payers and supplemental payers.

We also added a new segment called Response Other Related Benefit Detail to the eligibility transaction. This segment was added to support CMS’ enhancements to the eligibility data being provided to the transaction facilitator for Medicare Part D beneficiary.

A new grouping of fields was added to the Response Status Segment to allow comprehensive communication of help desk contact information that can be directed to the pharmacy or other receiving entities for coordination of applicable action.

We added 14 fields to support plan benefit parameters. The electronic communication of these parameters will reduce cost to provide our help desk where the same information is verbally provided today. Leveraging the standard to communicate this detail will expedite patient access to care, lower administrative cost and facilitate compliance with plan policy.

As ACOs and health care interoperability expand to improve patient outcomes, payers and intermediary supporting patient eligibility information may have access to all patient benefit classifications. While other payer adjudicator program type identifies the specific program, for example, Medicaid, Medicare, commercial, these same program types often apply to different benefit classifications. Access to the other payer benefit classification will allow the pharmacy provider to determine what actions to take.

The coordination of benefits and other payments count was reduced to a maximum count of three. Reducing the count to align with actual business cases will support industry compliance, allow for efficiency and claims processing and patient eligibility verification, reduce cost to provide help desk as well as mitigate unnecessary claim rejections that would occur due to attempts to submit claims to inappropriate other payer information returned on the spot on a response.

We mandated the return of reconciliation ID on approved transactions, which provide the mean to identify that transaction to any subsequent transaction or other associated activity occur. The reversal section and guidelines were rewritten to support the use of this field.

We harmonized 28 demographic fields with other NCPDP standards. We added functionality for REMS, which is the Risk Evaluation and Mitigation Strategies, and PDMP, which is Prescription Drug Monitoring Program.

A pricing guideline section was added. This change will provide a single location within the standard for comprehensive response processing and pricing guidelines will reside. The document is intended to support streamlined research, standardization of implementation and mitigate duplication of information or potential conflicts in guidance.

A new COB processing guideline section was added. We included other sections as well as moved everything into this one section versus having it peppered throughout the guide.

The controlled substance reporting, reversal, and rebill transactions were removed. A separate NCPDP control substance standard and implementation guide based on the telecommunications syntax will be developed. This change was needed to keep pace with yearly changes in state and/or federal controlled substance reporting requirements.

We added two fields for benefit type opportunities. This was done to promote transparency of planned benefit information, allowing the patient to take advantage of areas of their planned benefit they may be unaware of.

The payer ID fields were restructured to allow multiple identifiers to be returned on a single transaction response. We also added two new fields for submission type code and the count in order to identify the type of submission.

We also added what we call multiple prescription/service order group and the recent code. They were added to the claim segment to indicate the reason why multiple prescriptions for the same patient are being grouped together. This enhancement allowed the pharmacy to initiate specific actions based on the order group reason associated to the group prescription.

We also added a new data type of ECS for email character sets. This was given to the patient email address. It was changed to the new data type.

We added 16 fields to the response of the related benefit detail segment to support commercial insurance benefits and to build flexibility to support future benefit details. And then we also enhanced duplicate logic.

Eight new fields were added to the response claim segment to support the identification of the reason for formulary alternatives and the identification of required treatment.

The next three bullets relate to workers’ compensation and changes that we make to the standards to support that program and to also allow them to move from paper-based submission of claims to electronic submission of claims.

We also for our information reporting transaction, which is not a HIPAA-covered transaction —

(loses connection)

GOSS: Margaret? We are having a hard time hearing you. This is Alix. I was not sure if it was my cell phone or yours.

COUSSOULE: Getting less than one word in ten.

GOSS: Margaret, you were clear and then all of a sudden we lost your connectivity. Are you still with us, Margaret?

(No response)

WEIKERT: Can you hear me now?

GOSS: Yes.

WEIKERT: Instant replay. The Batch Standard Implementation Guide. We did make a few changes to it. We increased the length of the transaction reference number to match the reconciliation ID field, which is used in Medicare Part B information reporting process to track all the transactions. We modified examples. We added FAQs. And the use by multiple entity types was clarified.

The Subrogation Implementation Guide Batch Standard Version 10. That was developed to address industry need. The original guide was written specifically for Medicaid and other commercial entities, Medicare Part D, et cetera, expressed a need for doing subrogation at the same time as Medicaid. We created the new standard, which can be used by any payer type. It is used in a batch mode. It uses the underlying communication standard guide as well.

When we developed the standard, we used the Medicaid Subrogation Implementation Guide as the base. As I said, the Telecom Standard is actually the underlying standard used. We added some fields as well as deleted some fields that were specific to Medicaid. Also the situations have been modified to clearly state whether a field is required or situational and then what is the situation according to the type of entity that is performing subrogation.

The remainder of the presentation will be given by Annette Gabel, who is president of ACAG Consulting and co-chair of the NCPDP SNIP Committee.

GABEL: Good morning. As Margaret explained, I am co-chair of the SNIP Committee, which stands for Strategic National Implementation Process. You were close, Lorraine. I am going to be presenting on behalf of the committee. Typical to what occurs at NCPDP, once a new standard or an updated standard is brought forward to DSMO, the SNIP committee starts to meet and creates information that is either asked for testimony or we start working on timelines. We will put examples together. We will put a testing process together. We came together specifically this time to work on the testimony to provide to this committee.

The NCPDP standards that Margaret described were the Telecommunication Standard F2, the Batch Standard, and the Batch Standard Subrogation Guide. Those were the three standards that SNIP put information together for to present today.

Although Margaret went through a very detailed explanation of the benefits of the F2 standard, SNIP selected these benefits as what they considered to be the most important. The benefits that they have identified are streamline processes to maintain compliance, enhances reimbursement methodologies, enhances the availability of information allowing the pharmacy to better communicate to the patient, improves workflow automation, enhances patient safety mechanisms, improves patient access to care, improved analytics, and increase interoperability.

The next three slides are how we obtained those benefits. These are the source of benefits. For expediency, I am not going to go through all of these, but I am going to identify two areas. One is the patient safety and the other is to update or enhance the Medicare Part D capabilities.

On the Medicare side, a couple of enhancements that we made were to modify the coordination of benefit fields and segments to better support the maturing COB environment and to assist pharmacy providers and downstream payers in making claim billing decisions based on previous benefits and payment amounts.

Also, there was an enhancement of the eligibility transaction, which is the E1 transaction that is part of the telecommunications standard and the claim response transactions, which will provide better benefit identification and assist in coordination of benefits.

On the patient safety side, we enhance the requests to the claim segment that will provide additional information to improve patient safety, for example, related to opioid prescriptions.

And also enhancements were made to the prescriber segment, which will improve prescriptive authority validation and reduce point of service conflicts and expedite patient access to care.

We created an intermediary segment for the REMS process. We removed the controlled substance transactions from the Telecommunication Standard to allow alignment with independent regulatory timelines.

There were a lot of things that were changed to provide those benefits. I just wanted to highlight a few so that we could move on to the next slide, which is where I wanted to spend a little bit of time explaining to you how we came up with these dates.

SNIP created a timeline using assumptions. Our assumptions were based on dates that we put together. It would be wonderful if they fell into place that way once you put your testimony together and provided recommendations to the Department of Health and Human Services, but we had to start somewhere. We started with an assumption that the NRPM release would occur in July of 2019 and the final rule would follow with a date of December of 2019. That is where we came up with a final rule publication date of December 2019.

As we put our timeline together, we included months for business planning, development, testing both internally and externally with trading partners. We included a ten-month period of using the F2 standard in production and also at the same time as using the D.0 standard. It would be a ten-month period where trading partners would use both standards and production.

Pharmacy chains, processors and software vendors during that period could move portions of their business partners to the F2 standard. We also included a period of four months to allow transitions to the F2 standard before the compliance date. As we looked at what I have in the slide itself, we have that we would like the industry to start to use the standard in production as of June 2022.

SNIP is requesting a compliance date of June 1 to allow for a smooth transition for the pharmacy industry outside of the timeframe that are duly associated with large client implementations and seasonal events like the flu. That is how we came up with a compliance date of June 2023.

We are also asking for any help that you can provide us with our late adopters such as the states as we go through this process as we found that the last time, we had to have an extension and the extension was required because the states were not ready for the compliance states. Anything that we can get help on moving those states along would be greatly appreciated.

And now I am going to talk a little bit about the benefits of the batch standard. The batch standard is intended to be used in a non-real time environment. Although it is rarely used, there are circumstances such as reprocessing of large amounts of claims over an extended period of time that requires the use of a non-real time processing situation.

The benefits that SNIP saw that the updated batch standard provided is that it enhanced interoperability through documentation changes that were made to further clarify which entities are allowed to use the batch standard and under which situation. It reduces administrative cost by having one batch standard that aligns with the Telecommunication Standard Version F2 Implementation Guide.

As Margaret said earlier, the Batch Standard Medication Subrogation Implementation Guide, also known as the Medicaid Subrogation Standard, was developed to accommodate the transmission of claims data between Medicaid and other payers to facilitate recovery of funds that Medicaid should not have paid.

With the enhancements that we made, we made enhancements to allow any payer to utilize this standard when subrogating claims regardless of the payer involved. While it was renamed to the Batch Standard Subrogation Implementation Guide, it preserves the Medicaid situations and data requirements. By doing this, again, we improve transparency through enhanced ability to accurately report subrogated pricing between trading partners and it reduces administrative costs and increases interoperability by providing a single standard that can be used by a wider variety of payers.

That concludes the information that I have to provide today for you. I would be happy to answer any questions that you have. I do not know if we are doing that now or later. Thank you very much.

Agenda Item: Comments from DSMO Chair

PARTICIPANT: Just as with the previous speaker, there is an X by her name. I do not know if there is something the WebEx folks can do to –

NARCISI: Good morning. I am Jean Narcisi, the chair of the Designated Standards Maintenance Organizations as we refer to it as DSMO. I am also director of Dental Informatics at the American Dental Association. I would like to thank you for the opportunity to present testimony today on behalf of DSMO.

HINES: Jean, can you speak up please? Your voice is very faint on the line.

NARCISI: Can you hear me now?

HINES: That is a little better. Thank you.

NARCISI: Just for a little background about the DSMO. On August 17, 2000, the Secretary of Health and Human Services named six entities as the Designated Standards Maintenance Organizations under HIPAA. The DSMO organizations work together on the maintenance and development of HIPAA adopted administrative simplification standard transaction.

The six organizations include three standards development organizations: X12, HL7, and NCPDP. And three data content committees: the Dental Content Committee of the American Dental Association, the DeCC, the National Uniform Billing Committee, NUBC, and the National Uniform Claim Committee, NUCC.

The DSMO Steering Committee is comprised of one voting member from each of the six organizations and a non-voting liaison from HHS, specifically the Centers for Medicare and Medicaid Services’ Division of National Standards. The Steering Committee convenes as necessary and is charged with establishing consensus on all requested changes to HIPAA transactions and code sets. Changes are submitted through the DSMO Change Request System, either directly or through the moving forward of a transaction or code set from the applicable maintenance body.

On January 9, 2018 the DSMO submitted a letter to NCVHS recommending the adoption of the two NCPDP updates to the adopted retail pharmacy standards. The DSMO is requesting the following two updates proceed through the regulatory process for industry adoption under HIPAA. As Margaret mentioned, an update to the retail pharmacy standard, the NCPDP Telecommunication Standard Version D.0 and Batch Standard version 1.2, which was adopted in 2009. The update would be to adopt the NCPDP Telecommunication Standard Version F2 and Batch Standard Version 15, which would enable eligibility verification, claims, services, information reporting, prior authorization for pharmacy, and predetermination of benefits.

To replace the Medicaid Subrogation Standard, also adopted in 2009 with the Subrogation Implementation Guide for Batch Standard Version 10. The Medicaid Subrogation Implementation Guide was established to address the federal and state requirements for Medicaid agencies to seek reimbursement from the correct responsible health plan. However, the Medicaid Subrogation Implementation Guide did not address similar requirements for other payers, such as Medicare Part D, state assistance programs or private health plans.

A standardized Subrogation Implementation Guide is need to support compliance with requirements for recovery of federal, state and other overpayments, reduce manual processes currently required by pharmacies, PBMs and plans, provide a uniform approach to efficiently process post-payment subrogation claims and eliminate the numerous custom formats used by the industry today, and also achieve payment accuracy and support cost containment efforts.

The Medicaid Subrogation Implementation Guide was used as the base to create the new Subrogation Implementation Guide. The DSMO recommended the new Subrogation Implementation Guide be adopted for Medicaid Subrogation only. However, the new guide could be used by other payers to conduct a uniform process to support compliance with requirements for recovery of federal, state, and other plan overpayments, eliminating manual processes currently in place.

Members of the Subcommittee, thank you for the opportunity to testify. I will be happy to answer any questions you may have.

DOO: Great. Thank you, Jean, very much. You will be able to stay on the line presumably when we get to questions. Great.

Now, we will get to our first session, which will be the NCPDP F2 Standard. And the session will be the pharmacy group. Our first presenter is Erica Brown representing Pharmerica. I think we have Eric on the phone. She should be able to speak. You have the floor.

Agenda Item: Part 1 – NCPDP F2

Agenda Item: Session A: Pharmacies

BROWN: I guess I will just go through and answer the questions or was someone going to ask me and then I respond.

DOO: So you weren’t going to make – it is a different kind of a hearing because I know you had submitted written testimony. If you just want to respond during the session when we ask the questions, then we can hold it until then and other people will go through their presentations first. We can wait until the end of the session. That works fine.

BROWN: I do not have a presentation.

DOO: That works great. Not a problem at all. We will hold that until the end. The next person is Sharon Gruttadauria. Did I get your name right?

HINES: She is not appearing on the list of speakers. She is in the attendee list. I do not know if we can elevate her from attendee to speaker.

DOO: I know she had submitted written. I do not know if she also was going to present or not. I know Cathy Graeff is going to be presenting.

HINES: There is no phone icon by her name.

DOO: Why don’t we go to Cathy Graeff since I know she is on the line?

HINES: Lorraine, Christian Tadrus is next on the list.

DOO: He is not going to be presenting. He sent in written. He is away this week.

Cathy, is your line open? Do we have Cathy Graeff’s slides?

GRAEFF: I am trying to avoid feedback. Can you hear me without feedback right now? I was having an issue between my laptop and my landline.

Thank you very much everyone. It is great to be here today. Members of the Subcommittee for the record, I am Cathy Graeff and I am a consultant on pharmacy standards for NACDS and I am providing testimony today on behalf of NACDS. NACDS wants to thank NCVHS and its Standard Subcommittee for the opportunity to present our views on updating the HIPAA claims billing standards today.

NACDS, for those that may not know, represents traditional drug stores, supermarkets and mass merchants with pharmacies. Chains operate over 40,000 pharmacies and NACDS’ nearly 100 chain member companies include both regional chains and national companies. Chains employ nearly 3 million individuals including 152,000 pharmacists. They fill over 3 billion prescriptions yearly and help patients use medication correctly and safely while offering innovative services that improve patient health and health care affordability. NACDS members also include more than 900 supplier partners and over 70 international members representing 20 countries.

The NCPDP Telecommunication Standard is the major HIPAA standard that is used by our pharmacy members. It includes the transaction for the Medicare Part D Eligibility Verification as well as the Claim and Service Billing Standard among others. Those are the main ones our member pharmacies use. Member pharmacies did submit for those 3 billion prescriptions filled, three billion real time claim transactions last year, and that excludes the ones that were for eligibility. Claim billing, eligibility, and the predetermination transaction within the Telecom Standard are the ones that are most frequently used by our members.

As Margaret mentioned, it is a real time transaction. And because it is a real time transaction all occurring within less than three seconds, patient care and the patient experience are quite dependent upon a successful transaction. We will touch on that a little bit more during implementation. Because one can imagine that if a new version of the standard is named a successful implementation roll out and successful transition of that standard is really of major importance to patients as well as our members.

Since D.0 was implemented, our member pharmacies brought forth to NCPDP modifications that they felt were necessary in the standard in the future version to better address their emerging pharmacy business needs. And this new F2 version that we are talking about today incorporates many of those incremental changes to the D.0 standard that our pharmacies felt were necessary. Now that those are becoming more urgent we are encouraging HHS and CVHS to adopt the NCPDP Telecom Standard F2 and the corresponding batch standard.

These next two slides have many of the same features that Annette had on her slides that are the major features that we see in the new standards. I am just going to touch on three of them that have the greatest benefit to pharmacies as well as patient experience and patient medication adherence. The first one is the first bullet on here, which is the improvement to the response segments that supplement or replace free form text messaging with codified information.

By supplementing free form text with codified information, we better support our member pharmacies’ efforts to automate some of the pharmacy workflows in the future. These workflow enhances will increase pharmacy efficiency as well as improve patient care by reducing waiting times for patients and for access to their medication.

Additionally, member pharmacies can expect more accurate communication by the PBM through codified messages to the pharmacy and as a result by the pharmacy to the patient. That is an important benefit.

The second bullet I want to highlight on this slide has to do with the additional information and the claim response that is related to formularies. Many patients now experience more narrow drug formularies and there are incentives to substitute the payer preferred drug for what may have been originally prescribed. And that additional information in the claim response by the PBM supports the pharmacies’ efforts to communicate to the patient the reason for payer directed formulary alternatives. These new fields will also allow pharmacy systems to again trigger appropriate actions in workflow and facilitate compliance with planned policies and also expedite access to care by the patient.

On the next slide, I want to point out the enhancements to the help desk information provided by the PBM, the second bullet. That PBM help desk information will be more comprehensive and more specific to the issue with the claim in the new standard. This specificity streamlines both pharmacy communication protocols within the pharmacy and the claim resolution process. Help desk specificity also can enhance pharmacy workflow directing specific claim issues to specific personnel within the pharmacy calling specific numbers at the PBM’s facility and therefore more precisely communicating to the patient.

NACDS did communicate with our members to obtain their viewpoints on the necessity of moving to the new version. And our members are overall supportive of moving to the F2 version and the associate batch standard citing the following benefits. First, the greater ability to integrate specific claim issues into pharmacy workflow through automation, which will augment pharmacy efficiency. Also the ability to more easily comply with new federal and state regulations such as state controlled substance regulations and Medicare regulations.

Third, improve transparency regarding the patient’s drug benefit between trading partners and most importantly, enhancing patient communication resulting in a better patient experience and improve patient safety.

As previously stated, over 3 billion prescriptions utilize the Telecom Standard transaction each year. When you break that down, that is over 8 million a day impacting tens of thousands of patients every hour. Our members are building in their implementation project plans contingency plans that include patient access to care as the highest priority.

The HIPAA statute provides for a two-year implementation window – the two-year implementation window we do not believe is adequate time. Because of the need for a time period for voluntary transition to the new standard between willing trading partners with pharmacy chains, the process of store roll out, not all stores would transition at the same time for all chains. And also the ability for trading partners to be able to revert back to D.0 if something unforeseen occurs. We believe that the two-year timeframe is not adequate for that.

We also agree that it is important not to set the compliance date or any critical important milestones during the times of year when industry resources were already stretched due to the reasons Annette mentioned.

Many of our members have been engaged in the implementation planning process with the NCPDP and we believe NCPDP has arrived at what our members believe is a suitable timeframe for a transition period. NCPDP has taken industry concerns into account in their proposed implementation plan and we are recommending that the subcommittee follow NCPDP’s proposed timeline.

In summary, NACDS supports industry transition from D.0 to F2 and the associated batch standard within the timeline proposed by NCPDP. We want to thank NCVHS for the opportunity to comment on this important issue and look forward to working to ensure that the standards enhance pharmacy operation efficiency and compliance as well as improve patient safety and access to care. Thank you.

DOO: Thank you.

HINES: It looks like Lisa’s line is open.

SCHWARTZ: Good morning.

DOO: Lisa, do you have slides?

SCHWARTZ: I did not send them in. Good morning. I am Lisa Schwartz. I am the senior director of Professional Affairs at the National Community Pharmacists Association. I am also one of the pharmacists on staff at the association.

NCPA represents the interests of America’s community pharmacists including the owners of more than 22,000 independent community pharmacies. We thank NCVHS for the invitation to give testimony this morning. I do not have slides for what I believe will be brief comments.

Updates to the electronic communication standards such as the NCPDP Telecommunication Standard are important for trading partners to keep up with pharmacy practice advancements and also regulatory changes while providing for high-quality care to the pharmacy patients across the country.

Many of NACDS’ comments on the benefits of the new features also apply to small business pharmacies. I will comment on two important issues for our members. Almost without exception, NCPA’s members rely on pharmacy management system vendors for prescription processing. Two such vendors, QS1 and PDX, are scheduled in Session C later this morning.

The pharmacy management systems facilitate electronic dispensing records and claims billing with the telecommunication standard among many other elements in pharmacy workflow. Community pharmacies’ ability to comply with the implementation timeline relies greatly upon the pharmacy management system vendors. We urge that adequate time such as NCPDP has proposed is figured into the implementation timeline.

Education for pharmacists and for pharmacy technicians will be a role for NCPA and for the system vendors, but training for software updates will be vendor specific. Adequate time to program and test the updates will help system vendors have a smooth roll out to all of NCPA’s members.

One of my biggest concerns is payer implementation, similar to what has been voiced earlier this morning. The compliance date must provide adequate time for payers to implement updates to preserve and improve patient safety and preserve accurate claims billing. HHS might contemplate what supporter incentives would be appropriate for Medicaid programs, Part D and C plans, or insurance marketplace plans to meet the compliance dates.

That concludes my comments. I will be around for questions.

DOO: Thank you very much. Next on our docket is Darren Townzen from Walmart. Darren, your line appears to be open. Are you with us?

TOWNZEN: I am with you. Thank you. We certainly appreciate you allowing us to testify on this. I represent Walmart stores. We have over 5000 retail pharmacies across 49 states and territories. We are able to serve our patients through a number of different formats, through some 4000 supercenters and discount stores, 700 neighborhood markets and around 600 Sam’s.

If we look at the anticipated changes that we see for the different versions for us when we went through the version change from 5.1 to D.0, it was a significantly larger technical shift and overall undertaking that will be a lot less when we move to the F2 standard. We do believe that there are administration and operational workflow processes that will be relatively the same from store standing point. As everybody else has mentioned before, the information that is being exchanged is going to be a lot more robust and ultimately lead to certainly a continuity of care, but also a patient safety standpoint that takes us to a new level especially with the new REMS program that was spoken about earlier in using a different REMS segment.

Some of the benefits that we see from this is we have seen gained efficiencies, which will include sending multiple prescriber identifiers. It was mentioned earlier about us being able to send the DEA on the claim.

Just to talk through the challenges we have today because sometimes a prescriber can have multiple DEA numbers, but one in PI. That crosswalk can be difficult sometimes. By adding this DEA number in the F2 standard or up to the F2 standard, it will allow us to be a lot more certain and have a higher confidence level that the prescriber that we are using on the prescription claim is appropriate and has the appropriate controls in place around their DEA number and if they are able to prescribe the particular drugs and whatever conditions behind it so definitely one of the advantages that we see moving to the F2 standard.

As was called out earlier before when you have some – from a systems standpoint, if you have things typed in a free text field, first is a distinguished field. There are certainly some challenges around programming. But by having it in the distinct field has been evolved over to the F2 standards depending on what it is. You could certainly have some efficiencies in that programming. You are seeing that claim come back and you are able to parse that field to a specific situation.

Ultimately, this is going to cause greater efficiency in the pharmacy, but more importantly, it is going to create a much higher level of expectation from a patient. Continuity of care and patient safety is going to be a common theme from here.

A lot of the questions that we had mentioned earlier that the questions addressed have been addressed in a lot of the previous testimonies. One of the things I would like to call out is more around the opposition of us moving to F2. I think the only thing that is going to be of a challenge is the timeframe. If we learned what happened in January of 2012, it was a rough time to implement anything just because of the time of year it is, the normal plan changes, the flu season. If we could do anything, let’s steer away from the first of the year. I think what Annette had on her presentation about it being in June. That middle of the year is certainly more optimal from the timeframe from an operational perspective.

The other piece of it is NCPDP provides a forum to identify and develop and work through any potential concerns. The evolution – I think Margaret had mentioned. We have gone through 21 standards from the original D.0 to where we are with F2 and that represents this continuous process and continuous improvement we have within the NCPDP forum. Those workgroups meet four times a year. The whole process is around the spirit of transparency. They are from what is involved in this F2 standard and from an implementation standpoint, certainly should not be surprised with those that are involved with the industry. But that forum, if you will, creates certainly transparency and ability for someone to speak not only just being members within NCPDP, but also the public forum.

With that, I will conclude my testimony. I honestly am very grateful for the opportunity to present. Thank you.

MS DOO: Thank you. Very helpful. I appreciate that. Our next speaker is Gary Schoettmer from Net-Rx. Please forgive me if I did not pronounce your name correctly.

SCHOETTMER: You did very well.

DOO: Thank you and welcome. Your slides are up.

SCHOETTMER: Good morning. My name is Gary Schoettmer. I am a pharmacist and I have been in long-term care pharmacy for over 35 years. I am currently the CEO of NetRx. NetRx is a network of over 70 independently owned long-term care pharmacies located across the United States. We focus on group purchasing opportunities, pharmacy automation, operational management, and long-term care pharmacy advocacy at both the federal and state levels.

In addition, I serve as co-chair of NCPDP Long Term and Post Acute Care Work Group and also as the chair of the American Society of Consulting Pharmacists Government Affairs Committee. I would like to thank the Subcommittee for this opportunity to testify at this hearing.

My remarks will be primarily focused on some changes that will occur with a transition to the F2 Telecom Standard and the impact of those changes on the dispensing pharmacy, more specifically, on the long term care pharmacy.

Long term care pharmacy has some unique dispensing practices such as short cycle dispensing and promotes automated dispensing. Utilization of these dispensing practices then creates the need for billing processes that can accommodate the methods by which the medications are dispensed.

The F2 version of the Telecom Standard has multiple enhancements to improve the efficiency of the long term care pharmacy claim billing process. These include changes to better communicate a resident’s coverage status to the pharmacy, allowing for more accurate billing with fewer rejected claims. They also include changes that allow the LTC pharmacy to better communicate to the claims processor within an online claim, the specifics on how a particular medication has been dispensed and what dispensings are included in a particular claim.

Obtaining long term care resident drug coverage information is oftentimes difficult for an LTC pharmacy. As compared to many other pharmacy settings, we do not have a patient with a benefit card in hand at the site of dispensing. Instead, we are heavily reliant on the eligibility verification transaction. This is particularly true with new admissions and at the beginning of the Medicare Part D benefit year. During open enrollment, a resident’s family may opt to change the resident’s Part D plan, but this is oftentimes never communicated to the pharmacy.

The E1 response has a new segment in version F2 that communicates other benefit details. This new segment supports CMS’ enhancements to the eligibility data being provided to the transaction facilitator for Medicare Part D beneficiaries. It also supports commercial insurance benefits and has built in flexibility to support future benefit details.

Data elements include information about low income subsidy, end-stage renal disease, hospice coverage, and other coverages. Having this other coverage detail available as part of the e1 response will improve the efficiency within long term care pharmacy billing departments.

The F2 claim has a new field called long term post-acute care dispensing frequency. This field contains a code indicating the frequency of dispensing for the medication being billed. This information is currently being placed in the submission clarification code field of a D.0 claim, not because it is the right place for it, but because it could be put there and still maintain HIPAA compliance.

This information is required on a short cycle eligible claim to meet the CMS reporting requirements. Examples of what would be coded in this field would be a code indicating that this particular order is filled every 14 days, every 7 days, every day, or perhaps on a per med pass basis amongst other methods.

The F2 claim also has a new field called the LTPAC Billing Methodology. This field contains a code indicating the billing methodology used for the claim. Codes exist for the following methodologies: First that the full quantity dispensed was dispensed on the date of service. Also, a post-consumption status where the date of service represents the date of the earliest dispensing. One or more dispensings make up the total quantity on the claim and the total quality of the claim has been dispensed.

Also, there is a pre-consumption methodology where the date of the service represents the date of earliest dispensing. One or more dispensings make up the total quantity, but all of the dispensings that make up the total quantity on the claim have not yet occurred.

Use of this field allows the pharmacy to provide additional clarity to the claims processors. This is particularly useful when the pharmacy is billing on a cycle that is different than the cycle for dispensing.

Number of LTPAC Dispensing Events field. This is a new field in the F2 claim. This field contains a value indicating the number of times the pharmacy dispensed the product or service for the claim period requested. In other words, for an LTC pharmacy, this would indicate the number of product dispensings that occurred to generate the quantity of medication that is being built for in the claim. This provides the claim processor with additional clarity particularly for purposes of determining the dispensing fee to be paid to the pharmacy.

Use of the quantity prescribed field and also the total prescribed quantity remaining field. Transition to version F2 of the Telecom Standard would provide a solution to a longstanding problem related to partial fills of prescriptions for Schedule II controlled substances. The current claim format, D.0, has no way to distinguish a partial fill from a refill. This combined with the fact that Schedule II controlled substances cannot be refilled, but under limited circumstances can be partially filled. This has created a problem.

In September 2012, HHS’ OIG issued a report stating that Medicare Part D inappropriately paid $25 million for Schedule II drugs billed as refilled in 2009 and that three-quarters of Part D sponsors paid for Schedule II drugs billed as refills.

The OIG report further states that 75 percent of the Schedule II refills originated from long term care pharmacies and that CMS should use this information to develop guidance to sponsors to prevent Schedule II refills and to ensure accurate billing of partial fills. To date, this problem continues.

Use of the F2 Telecom Standard would provide a fix, allowing for the distinction between refills and partial fills.

In addition, the Comprehensive Addiction and Recovery Act of 2016, CARA, permits partial fills of Schedule II prescriptions for outpatients for up to 30 days upon request of the patient or prescriber. This will create increased occurrences of this issue, the issue specifically being the need to distinguish a refill from a partial fill.

For reasons that I have mentioned along with reasons previously articulated by others, I respectfully request that NCVHS Standards Subcommittee recommend a transition to version F2 of the NCPDP Telecom Standard. Again, thank you for this opportunity to share my thoughts and concerns.

DOO: Great. Thank you very much. And now we will allow the committee members to ask their questions. If I could ask all of the presenters to open their lines so that they can all respond – of course, the committee members as well.

WEIKER: Lorraine, this is Margaret. Do you want to see if Sharon is able to give her testimony?

DOO: Sharon, are you now unmuted?

GRUTTADAURIA: Can you hear me? I know we are right up at the top of the agenda so I will make this very brief. Good morning everyone. My name is Sharon Gruttadauria from CVSHealth. I am from the CVS Pharmacy Division and I want to thank NCVHS for presenting this opportunity for CVS to present. I know that our PBM partner is also presenting later on today.

I just wanted to call out because all of the other business experts in the industry have already identified some of the major components and the details and the enhancements for the version F2. I just want to roll it up a little higher to outline how the industry has enhanced – how prescription claims in the pharmacy industry has moved forward since version 5.1, the first HIPAA named standard.

Coincidently, that was the first time that I was involved with the electronic standards. That is when I actually started with the CVS. It was at a point where I was implementing only and did not know the background behind it. I had a great deal of experience in figuring out how to implement and coordinate across the industry.

And then with version D.0, we made some major enhancements in D.0. The structure was changed slightly. Much better ability for coordination of benefits and compound processing and the ability to support the Medicare Part D program.

Again, my involvement was mostly the development side of that implementation and deployment. Not yet in the building blocks on the NCPDP side.

I was very fortunate to be involved with version F2 in those building blocks. Progressively over the years, I was able to identify the needs within the pharmacy industry, bring those to our business partners within NCPDP, obtain that consensus approval that this is what is needed as well as bring in how CVS has actually changed over the years where we are no longer just a retail pharmacy. We have long-term care. We have specialty. We have mail order and coordination with PGM and certain components and initially building that consensus process.

The changes in F2 are everything that we have been looking for to address our business needs as well as regulatory requirements. The better visibility of planned benefit information is very important to the pharmacy so that we can communicate to the patients at point of service. We can reduce that amount of time that it takes to process the claim and resolve conflicts. We can reduce calls back to the health plan. Overall, we will reduce administrative cost and enhance that patient experience.

There is a great deal of enhancements within F2 around a controlled substance and patient safety. The integration of a REMS component is going to be very important to our pharmacy teams from a clinical perspective and patient safety as well as the opportunity to also integrate a national PDMP within that process.

Overall, we are very much in favor of moving forward with version F2. As others have mentioned, I think the important piece, as I indicated earlier, I started with an implementation and deployment process. It is evident that the industry needs that three-year period in order to make sure it is streamlined and smooth transition that does not impact patient care.

Thank you. I appreciate the time to speak and sorry about the mishap earlier. What had happened in case other folks are on the call is I had dialed in before I opened up the WebEx. I think that was the problem. Thank you again to the NCVHS committee and looking forward to the rest of today’s meeting.

DOO: Thank you very much. Sorry about that, Margaret. Thank you for bringing that up. Nick and Alix, I am going to turn this back to you. I have questions too, but I know you guys and the rest of the committee members have them. I will “allow” you to manage this process and start with the questions and then you may want to call on each committee member to see if they have them.

First, I want to just say thank you to all of the speakers. This was really a great beginning to the hearing. Co-chairs, please take it away. Again, if everyone can open up their lines, we will start the discussion.

Agenda Item: Committee Q&A

GOSS: Nick, I see your hand is up. Do you want to go ahead and get us started?

COUSSOULE: Let me ask a question for actually just about any of the presenters so far. There is always an interesting challenge between moving fast enough to meet the needs that are there given the changing environment we are in and moving so fast that people cannot keep up and it is unmanageable.

Most of the testifiers agreed that the timeframe presented was an adequate timeframe. I guess my question is more about that kind of timeframe. Does it provide enough capability to change such that the industry needs can be met on an ongoing basis? If not, what opportunities would there be to increase the pace if any from a practical standpoint?

GRUTTADAURIA: This is Sharon Gruttadauria from CVS. I will take a stab. As far as the ability to increase the time period to move forward to enhancements, the NCPDP Telecommunication Standard actually has the capability to do that within the same version when we implemented the moving ECL or External Code List. There is opportunity within that that we can make changes with qualified attributes to support changes within the industry. We found that to be very beneficial within version D.0. I do not know if Margaret has the number off of the top of her head, but the number of changes we made between 2009 until today within the External Code List.

WEIKER: We had 156 requests, Sharon, for changes to the External Code List.

TOWNZEN: This is Darren from Walmart. I would echo what Sharon said. I think with the call out with this External Code List, it gives us the capability to enhance the communication specificity between a payer, PBM, or PBM back to payer. It does not necessarily change the situation, which is really the purpose of having a new field is. The enhanced communication really allows us to be a little bit more nimble instead of waiting for each different version that may come along every ten years or so.

GOSS: Are those others who would like to comment on Nick’s question or should we move to Rich Landen to ask the next question? Rich?

LANDEN: Thanks Alix. A couple of questions. First, for Annette Gabel if Annette is still on, in slide 25, you talked about point of service conflicts. Can you talk a little bit more about what those are?

GOSS: Is Annette still with us? I am not seeing her on the panelist list.

LANDEN: If she is gone, maybe Margaret or anybody else.

WEIKER: I believe the comment and Sharon Gruttadauria is also a co-chair of the SNIP Committee and she may be able to speak on this as well. We added additional data elements in the prescriber segment. In regard to the conflicts, it had to do with DUR or edits from the payer PBM system, especially around controlled substances. A lot of entities are now putting a lot of edits on controlled substances such as you can only have a three-day supply, et cetera. And by adding these additional fields and clarifications, it helps to reduce those rejections and conflicts upfront versus at the back end.

GRUTTADAURIA: This is Sharon. Just to add onto that, specifically when we are talking about the prescriber segment and I think Darren talked about this as well, what we did is we added the DEA attribute as well as we added a prescriber place of service attribute. What that does is it allows more streamlined communication between the pharmacy and the payer relative to controlled substances for them to be able to initiate and apply their prescriber validation rules.

In today’s world, only the NPI goes over so a lot of crosswalks have to happen. When it is an intern or resident that is prescribing, it is their signature on the prescription based on the Board of Pharmacy Rules. The pharmacy has to identify the intern or resident as the prescriber because that is who signed the prescription. But that intern or resident does not have their own DEA number. They are leveraging the facility’s DEA number. They are able to prescribe under the facility’s DEA. Now this will allow us to send that DEA number over and now the payer actually has a DEA number to validate.

In today’s world, all they have is an NPI. They crosswalk and find that prescriber on their file and they find that that prescriber does not have an individual DEA number. It incurs a reject. Now there is a conflict that the pharmacy has to resolve. In tomorrow’s world, the conflict will go away.

LANDEN: Thank you very much. Second question. A ton of the presenters talked about patient safety implications. I think that is great. I do not have a specific question. I will defer any questions on that, but we will follow with Margaret to get a better sense of what all the patient’s safety upgrades are.

My last question is about the F2 other related benefit detail. I am not sure I understand what that is although it seems to be an automated way of transmitting additional patient benefit coverage. I get a little uncomfortable there about disclosing additional information without the involvement of the patient. Could somebody talk a little bit more about that? What is the role of the patient? What is to prevent benefit shopping? What are the needs and what are the safeguards in place?

GRUTTADAURIA: Hi, Rich, this is Sharon again – speaking to your exact question. Is it a particular slide that you are pointing or a bullet number?

LANDEN: No, it was not. This was I think in the testimony or the talk by Mr. Schoettmer.

SCHOETTMER: This is Gary. Yes, it was one of my slides. Basically, with the enhancement to the E1 eligibility verification, there are some specific benefits that are communicated: the LIS, end-stage renal, hospice coverage. And then other benefit would accommodate private insurance information basically so that the pharmacy would know exactly what the coverage was for a particularly patient so in the case of some of the government programs, if the patient also has private insurance, in many occasions, that would be primary to a government program. It would be helpful to know that in advance as opposed to after filling and submitting a claim only to have it rejected.

GRUTTADAURIA: This is Sharon. Just a little bit more information on that. What we did is we added several new attributes, entire new segments for the payer processor or intermediary to be able to return back other coverage information in more detail around that other coverage. In today’s world, we are limited and all they can send over is the BIN and the PCN and the card holder ID and the group ID of other coverage information they may have on file.

Because of the status of some of the third party liability files that are available, pharmacy either does not get information that they need or they get incomplete information. We enhanced the communication abilities. And now the payer processor or intermediary can tell the pharmacy if it is pharmacy benefits, medical benefits, if it is mutually exclusive to the benefit that you are billing or it is a coordination of benefit scenario.

LANDEN: Okay, so there is nothing – I think I am satisfied. Just one final – just to make sure I understand. There is nothing in here that is outside of the HIPAA authorization sort of treatment payment and operations. No privacy or PHI disclosures.


LANDEN: Thank you. That is it, Alix.

GOSS: Thank you, Rich. I think I am the only one else of the subcommittee members that has their hand up. I am going to go ahead and ask a question. General question to anyone who has already presented. I noted the aspects of the subrogation guide have been adopted from a policy perspective for Medicaid pay and chase. I noted that the guide has been updated to not only include Medicaid aspects, but could be used by any payers. I am curious as to the thinking on advancing and expanded capable guide for upgrades, but keeping the same policy slice, meaning used for Medicaid only. Why not propose it for all payers to use?

WEIKER: This is Margaret and I will take that one. When we were moving this guide forward, we had a discussion several times in both the task group that developed the work and then in the Workgroup 1 meeting. In regard to do we move this forward for all or just for Medicaid. And the people on the task group calls as well as in the Workgroup 1 meeting said we just want to do this for Medicaid only. Some of the other entities said we would like to implement this first, get our processes, procedures, systems updated and then down the road mandate it for use versus mandating it for use out of the gate and then having to make a major system change at this point of time.

GOSS: Did I just correctly infer that there is an interest in voluntarily adopting this, getting better experience with it and then expanding the policy based upon lessons learned?


GOSS: Thank you. Anyone else want to comment on Medicaid subrogation guide?

LANDEN: Alix, Rich Landen, again. I think this is a good thing for NCVHS and the Standards Subcommittee to follow. If we could keep in touch with NCPDP and just look at – we have one market segment. Medicaid is mandatory. If CMS, HHS adopts the transactions.

But just to follow that idea of a voluntary implementation piggybacking on the Medicaid mandatory implementation I think would be interesting to see in terms of whether that might be precedent for additional transactions, not just NCPDP. So something we should watch.

GOSS: Sounds good. I noticed that we have Lorraine’s question up, but I also note that we are about 20 minutes behind schedule. Lorraine, if you want to ask a quick question, we will do that. And then I think, Nick, we need to go towards the break for probably making it a brief one.

DOO: I just had a quick question. I do not if Lisa Schwartz is still on the phone.


DOO: Great. I just had a question. If you could talk a little bit – you had mentioned something about contemplating incentives related to either the pharmacists or the vendors. I wondered if you would not mind just expanding on that a little bit.

SCHWARTZ: That would have been directed more towards the payers. I think both Cathy and Sharon touched on some of the Medicaid that were not quite ready to go with D.0. It was not so much the vendors or the pharmacies, but – that HHS might have a little bit more direct influence over. Does that make sense?

DOO: Yes. I just want to understand that. Conceivably incentives for getting ready and being compliant and prepared for implementing the standards.

SCHWARTZ: Being ready to go with the various pharmacy company or pharmacy system vendors that put a lot of work into being ready to go on time and comply so that everybody is ready together.

DOO: Thanks very much. It is time for our break. It is 10:45.

GOSS: Ideally, could we just take five minutes and come back. I know it says ten minutes, but we are way behind, which is great because it has been wonderful commentary and I do not want to cut any of the subsequent sessions short of the – how about 10:50 we will return. Five minutes.

DOO: We will be back online. Don’t hang up. At 10:50. Thank you very much everyone. We will start with our payers and processors, pharmacy benefit managers.


Agenda Item: Session B: Payers and PBMs

DOO: Jose, you have the floor. Welcome. Thank you for being patient and being with us today.

TIESO: You are very welcome. Thank you and good morning everyone. My name is Jose Tieso. I am an account executive for DXC Technology in the State of Delaware. DXC Technology is the world’s leading independent end-to-end IT services company, helping clients harness the power of innovation to thrive on change. Created by the merger of CSC and the Enterprise Services business of Hewlett Packard Enterprise, DSC Technology serves nearly 6000 private and public sector clients across 70 countries.

The company’s technology independence, global talent, and extensive partner alliance combine to deliver powerful next generation IT services and solutions. DXC Technology is recognized among the best corporate citizens globally.

DXC Technology fully supports the advancement of the NCPDP Telecommunication and Batch Standard version F2 along with the Batch Standard Implementation Guide version 15. We provide technology and business process services to many clients in the health care industry. Our clients are diverse and include state and local governments in the Medicaid and Health and Human Services arena, federal customers supporting Medicare, and commercial health care and life science companies together providing services to over 50 million Americans each and every day.

At the heart of the health care industry and behind the scenes are electronic transactions supported by standards like NCPDP. The advancement of version F2 will allow the industry to continue to evolve and become more efficient in the data exchange of health care information across all participants and the health care echo system.

DXC Technology processes hundreds of millions of health care transactions annually with over 50 million transactions related to pharmacies specifically. The change in this version will have a positive impact in our clients’ businesses, provide more accurate and precise data and the support of pharmacy services for the safety of our recipients.

Important updates in the standard will support day-to-day pharmacy billing and data exchange between all health care partners from the doctor’s office all the way through to the pharmacy.

Electronic prescribing and electronic prior authorization are two critical health care processes that help reduce manual intervention, reduce human errors, increase safety, efficacy, and efficiency and the distribution of prescriptions and payment of pharmacy claims.

The anticipated changes once made mandatory will impact our technical solutions, systems, and processes primarily behind the scenes. Each of our clients has different rules and timelines to support the implementation of major projects such as these new standards.

Typically, a one to two-year cycle is required to develop and implemented these types of projects. During these cycles, projects are developed, budgets established, financing obtained, and in some cases legislation introduced in past in states before the commencement of the implementation.

One important factor in the success of advancing a new standard is communication. It is critical that all stakeholders for each of our clients is involved, understanding the impacts to their solutions, development of updates to appropriate interfaces, and finally providing sufficient timing to test a new standard from end to end.

DXC Technology provides pharmacy services in 12 Medicaid states. For these state Medicaid customers, their fiscal years go from July of the current year to June of the following year. It is extremely beneficial when the adoption of a new standard syncs up with the start of a state fiscal year.

Further, a two-year cycle will also support the adoption and passing of any needed legislation. In sum, DXC Technology supports the advancement of the F2 standard. Thank you for the opportunity to provide testimony to the committee.

DOO: Thank you very much. Our next speaker, I think, is Michael Safreno. Are you on the line? Kathy Knapp? You have the floor.

KNAPP: Good morning, members of the Subcommittee. My name is Kathy Knapp. I am the manager for Regulatory Compliance with DST Pharmacy Solutions. We would like to thank you for the opportunity to present today concerning the adoption of the NCPDP Standards, specifically version F2 for telecommunications and the corresponding Batch standard version 15.

DST Pharmacy Solutions was formerly known as Argus Health Systems. We are a leading provider of health care information management services and support commercial, Medicaid and Medicare Part D. programs. We provide services to a wide range of clients, including managed care organizations, pharmacy benefit managers and pharmaceutical manufacturers. DST Pharmacy Solutions is part of DST health care companies, serving over 50 million covered lives and process more than one billion pharmacy claims annually. The responses below represent our perspective on those adoptions and that is on the view of a health care information management services provider and as a member of the group identified by NCPDP as processors.

I did prepare and submit testimony for all of your questions; however, today and in the interest of time, I would like to touch on benefits, barriers, and timeframes. Specifically, for the anticipated benefits related to Question 2 of those that were submitted, DST Pharmacy Solutions identified those benefits that we consider most impactful to stakeholders with the adoption of the new standards. Those include identification of payer types will prevent government program beneficiaries from accessing pharmaceutical manufacture copay coupons for drugs paid under those programs, including Part D.

The Expanded Product Service ID field that Margaret and others have mentioned will support the use of the UDI, Unique Device Identifier, which is required by the FDA for diabetic testing supplies and other Class 1 and 2 medical supplies dispensed by retail pharmacies.

The Coordination of Benefits, the COB enhancements, specifically again the ability to specify plan types, other payer types, will help us enforce the processing order with Medicaid as the payer of last resort.

The refining of the patient pay fields will help us handle sales tax better, again, allows the Medicaid plans to exclude sales tax.

A lot of the pharmacy section speakers touched on the pharmacy response enhancements. We also feel that that will allow payers and processors to provide more detailed and actionable information. Primarily, it could those to avoid prior authorization interruptions on the pharmacy side in the workflow.

Optional data such as formulary alternatives and next fill requirements available in the pharmacy response will support greater transparency between payers, processors and pharmacies. The controlled substance and opioid processing is enhanced by many of the fields specifically with the quantity dispensed, prescribed and remaining available on each script.

Also, as Gary touched on, the clarification space for long term care claims will definitely help process long term care more efficiently.

Moving on to the anticipated barriers, which would align with your Question 3, we see the primary barrier being the readiness of all stakeholders to adopt the new standards at the same time. We feel the committee can proactively address this by enforcing an adequate implementation schedule that meets the needs of all stakeholders. DST Pharmacy Solutions recommendations that NCVHS apply the timeline developed by the NCPDP SNIP committee.

Continuing on with the theme of timeframes related to Question 5, based on the very real scenarios experienced by stakeholders with the last HIPAA standards change, the two-year timeframe does not appear to be feasible. Implementation of new versions of the standards requires significant planning, development, and internal and trading partner testing prior to a full industry cutover. Again, in order to ensure that the industry standards are aligned with the F2 implementation, DST Pharmacy Solutions recommends that adoption of the SNIP timeline.

Those were the points I wanted to touch on today. I will be available for questions at the end. I appreciate the opportunity. I respectfully request the adoption of F2 and Batch Standard 15. Thank you.

DOO: Great. Thank you very much. I think that Jon Paladino was submitting written testimony and was not planning to speak. Are you going to speak? Wonderful. I know we had gone back and forth a lot. I am glad you are on. Thank you and welcome.

PALADINO: Thank you very much. I appreciate this opportunity to speak on behalf of Prime Therapeutics. Prime Therapeutics is a privately held company, a full-service benefit, pharmacy benefit management company that serves 21 Blues Plans and more than 20 million members. My role at Prime – I am a senior industry affairs analyst working on industry standards. In my comments, I would like to address many of the same points and reinforce, as my colleagues have made previously.

The move forward in the NCPDP Telecommunication Standard from version D.0 to version F2 is a result of many years of pharmacy industry consensus building. This version F2 provides many enhancements in transmitting data to better support the evolving business environment since the implementation of D.0.

Some of the examples that we have seen in that timeframe have been the introduction of the individual marketplace plans, continued refinement of the Medicare Part D prescription drug benefits and greater moves towards managed care models by state Medicaid agencies.

In implementing version F2, some of the benefits to be realized in the transition will be better information on the prescription benefit and insurance structures through adjudicated program type information. Also, enhancements to the coordination of benefits information allowing pharmacies and payer processers alike to have more detailed information on the adjudication and involved parties in the transaction.

Improvements to the information for controlled substance claims including quantity prescribed, which will allow pharmacies and auditors the distinguished multiple dispensing events from a single fill from true refills of controlled substances.

Increased granularity of codified values, which will create the ability to increase automation of different processes for both the sender and the receiver of the transaction. Information on intermediaries as previously noted this is mainly REMS processors or Risk Evaluation and Mitigation Strategy processors.

The addition of more specific fields to differentiate various types of fees including taxes versus regulatory fees and medication administration fees.

As a net result, many of these changes will provide increased transparency for all trading partners. The transparency of what type of plans adjudicated the claims, which organizations those plans are, and who are the providers involved in the prescribing, billing, and paying of each transaction.

Another benefit of the improved information and the billing transaction is better information in real time at the point of sale so that patient service and care may be positively impacted.

Now one of the key concerns also mentioned by most of the testifiers so far is the timing and the effort in moving to this new version. Historically, small independent pharmacies and especially state health programs have the most difficulty meeting the timelines. For this reason, we support the timeline recommended by NCPDP. This timeline allows enough time for these parties to properly prepare while limiting the amounts of time for the majority of organizations to incur extra cost for efforts such as having to support dual versions, double development in these dual versions and testing efforts for such transition periods. Also, the extension of the timeline would require unique processes to be supported in the two versions.

The NCPDP timeline also considers the general time of claim processing, including the impact of benefit renewal dates and support for the flu season. This timeline will influence the overall cost of implementation. A longer timeline would incur the additional costs such as noted previously as well as requiring project start and stops, similar to those that were experienced during the D.0 and ICD 10 implementations due to the extensions of the regulatory compliance dates.

Based on this incremental comparison of the D.0 implementation and the many unknowns we have prior to a proposed or final rule, we feel that the estimates for a large PBM implementation cost for D.0 is noted in that final rule are a reasonable assumption at this time given the information.

The improvements contained in this next version, F2, are instrumental to version D.0. In fact, the framework of D.0 is largely retained so the pharmacy industry will realize that a real-world experience of millions of transactions daily for more than six years. The transition to version F2 should be more of an iterative process than the previous transition for this reason.

At this time, I would also like to address the change in the subrogation standard. The Medicaid specific parts of the Medicaid Subrogation Standard are few. NCPDP made the decision to make the standard available for all types of subrogation while at the same time agreeing that it should be mandated only for the Medicaid use case.

The other types of subrogation activities may use the standard according to business partner agreements. This is the exact same situation that happens today were all non-Medicaid subrogation are at the discretion of business trading partner agreements.

On behalf of Prime Therapeutics, I appreciate this opportunity to testify in favor of this important step forward for the pharmacy industry and welcome any questions that you may have. Thank you.

DOO: Thank you very much, John. We appreciate that input. Our next speaker was Laurie Littlecreek, but we knew she was tentative. I know she is on the phone, but I think she may be in listen mode. I do not think she is going to be speaking. I think she might be in via cell phone or something.

GOSS: It looks like she is on the WebEx panel. I do not know if we want to open her line and just check.

DOO: It was certain from her company that she was going to speaking. I just want to confirm. Laurie, are you going to be speaking or just sending in written?

LITTLECREEK: We will be sending in comments. Thank you.

DOO: That is what I thought. Thanks very much. Nick and Alix, do you want to ask questions of this panel or do you want to go to the clearinghouses?

COUSSOULE: I think we should give people a chance to ask questions briefly if we can. We have a few minutes in the time schedule.

DOO: Again, subcommittee members, you can raise your hands and we will look for them.

GOSS: While you are asking your questions, I just want to recognize that Denise Love, a subcommittee member, has joined the meeting.

I am not seeing any hands up for questions. Nick, are you?

WEIKER: Alix, this is Margaret. I noticed Mike with CVS Health is on the webinar now.

DOO: Michael Safreno – he was supposed to speak earlier.

DOO: Mike, are you on?

SAFRENO: Yes, I am on.

DOO: Would you like to give your comments?

SAFRENO: Yes. Thank you. I had some trouble getting to the conference just coming off vacation. Our main comments at CVS Health – I am with CVS Health. I am the director of Industry Standards. I attend NCPDP and then also monitor changes in the industry to ensure that CVS complies with all standards that are related to claim processors.

I am speaking on behalf of the PBM side of the business. We process the claims for the – we accept the claim transactions for the pharmacies and then bill the insurance companies and pay the pharmacies after adjudicating the transactions.

Just from an overall industry standard perspective, CVS is an active participant in NCPDP and we have been for many years. We believe in supporting the industry as it makes improvements. I have noticed that a lot of the questions on the questionnaire were around what are the improvements? What are the burdens? What are the costs associated with that?

In that regard, from a cost perspective, we look at this as just part of our overall operating model that we support the changes that occur in the industry because changes have been addressed across the entire industry through negotiation and trying to find the most appropriate things to move forward to really improve the patient experience overall.

Our support of F2 is mostly, Loretta, just to support the industry. There are not a lot of specifics in here that have an overall change that we are looking to implement. We just see that there is a tremendous amount of positives in here for the industry.

I really do not have too much in terms of comments on this. I did submit some written comments. Those will be added to the record. That is about the only thing I have at this point. Sorry that I did not join earlier to hear what the questions were or if there were any type of open issues that people wanted to discuss.

I do want to state that from a time perspective, our experience on this before with the previous implementation is that there is a significant implementation time. I know it was one of the questions. It talked about a two-year period of implementation. We certainly do not think that that is sufficient time for implementation. NCPDP, again, were meeting as an industry on this and discussing all the issues we will have with implementing a new standard. Some of the issues that we have in the PBM world are that we are accepting transactions from thousands of different pharmacies, possibly 20,000 or more independent pharmacies as well as tens of thousands of chain pharmacies.

To comply with those standards, there is probably about 180 different software vendors that all have to update their software. And then on top of updating their software — this is used by independent pharmacies for the most part as well as the individual chains – on top of updating their software, they have to be able to test with us and validate with us. There is a significant testing window on top of a development window for any new standard.

NCPDP is part of the discussion in one of our task groups. We have laid out a timeframe for implementation. We would like to see that followed if at all possible. That is about the end of my comments at this point.

DOO: Very helpful. Thank you. I am glad you were able to get on. There is still the opportunity for questions because we just began that period with the subcommittee members.

SAFRENO: I will stay around for anything further here and if there is something I need to add later on. On top of that, when I say we are supporting a standard and there is a whole lot in it that was directly – what we are asking for as a PBM, there are some very key items in here, especially expansion of the BIN routing numbers, the product service ID expansion, and then there is some improvement in the COB, the coordination of benefits. There are a number of items here that do make things better as an industry and more clearly define it. There are things in there that we definitely have a strong opinion on in terms of support. Thank you.

DOO: Thanks. Did you put those items in your letter?

SAFRENO: Yes, I did.

Agenda Item: Committee Q&A

COUSSOULE: Lots of testifiers or folks today have talked about the – I guess continuing to make this enforced, if you will, for Medicaid, but optional elsewhere. Can I get just a little more context on that? What is the rationale for forcing it on Medicaid operations, if you will, and maybe that is a strong word, and making it optional elsewhere as opposed to either making it optional for everyone or making it mandatory for everyone?

DOO: You are talking about the subrogation standards.

SAFRENO: I cannot speak to the subrogation standard.

GOSS: Other panelists, do you have commentary for Nick?

COUSSOULE: We could conceivably hold that question until the end. It has come up a couple of times and it is in the back of my head. I am just trying to make sure I understand the context between the different testifiers. If it makes more sense, I can wait until the end and we can have that with all the participants.

PALADINO: This is Jon Paladino from Prime Therapeutics. That situation is what exists today. The only thing standard under HIPAA is for Medicaid subrogation and all other subrogation activities are at the discretion of the trading partners subrogating claims. It really is the same. It is just the standard is available, which is pretty similar to today, where it is a batch claim or any other format that the other non-Medicaid subrogation takes place in.

COUSSOULE: I know we have some specific folks talking about that this afternoon. I probably should have waited. It keeps popping up. In the back of my head, I wanted to ask the question.

DOO: And to help clarify it – Margaret, it may be something from the standpoint of the recommendation that came from NCPDP to the DSMO of putting it forward as still of a standard for Medicaid use only – required for Medicaid use and voluntary between other trading partners. Sort of the context of which it was submitted to the DSMO versus using the opportunity to make it mandatory for all payers. I think that is Nick’s question is why wouldn’t it be then across all covered entities.

WEIKER: As I stated previously, the task group that developed the standard and then the associated work group who ultimately approved the standard, both groups in discussion and in votes decided that it would only be applicable to Medicaid. As Jon Paladino stated earlier, that is what it is today where Medicaid is only required to or mandated to use subrogation. Others are up to the trading partners.

The commercial entities that participated in the discussion stated that they would like to get experience with the standard first before it being mandated. That was the reason why we did not ask for it to be adopted for everyone. We just asked for it to be adopted for Medicaid. It does not prevent anybody from using it.

GOSS: This Alix. Can I ask you about something there? The commercial payers want some time to get some experience. I completely understand that. But can you help me understand, like isn’t the subrogation guides not like a foreign standard? It might be a nice slice and dice version of using an NCPDP transaction, but it is really synergistic at least that is my thought, with the other claim frameworks.

GRUTTADAURIA: Margaret, do you mind if I jump in. This is Sharon from CVS Health/CVS Pharmacy. Maybe this will help clarify the rationale for keeping the mandate on the Medicaid side. It is only within the Medicaid world today that Medicaid is identified. Medicaid or ADAP, are identified as payer of last resort where the subrogation component would come into play based on the timing of the third party liability and eligibility file information where Medicaid paid and they should not have. They find out retrospectively that somebody else was a primary payer.

Looking at the CMS billing order and the insurance rules of who would pay as primary, secondary, tertiary. In today’s world, I am only aware of is Medicaid and ADAP with that identification of payer last resort.

When NCPDP expand the subrogation to other payers, one of the primary payer types that we brought into that was Medicare Part D because Medicare Part D also had some type of billing order rules and the movement of members from one plan to another plan. There were certain business cases within Medicare Part D that the industry felt that the subrogation standard would be extremely beneficial for.

Because what is happening today is that instead of the payers being able to subrogate the claims so that they can handle it on the back end, they are pushing the work into the pharmacy world asking them to reprocess claims that could be outside billing windows. It creates a very huge wrinkle in the pharmacy claims processing environment. They need to build that into the back end. As Margaret indicated, those billing order rules need to be clearly defined particularly from a commercial to commercial before any thought can be put behind mandating it across all payers.

I can tell you even in the Medicaid world today even though the Medicaid subrogation standard was under D.0 or mandated, they are not all using it. They still push some of that work onto the pharmacies. Again, additional thought process being as all payers start to adopt and support subrogation, I think it will be a smoother transition and will see increased adoption.

WEIKER: To add to what Sharon said, the subrogation standards, the underlying standard is the telecommunication standard. And the subrogation implementation guide talks about the entities that flow certain fields, that type of thing, but the underlying standard is the telecommunication standard where we have deleted fields, added fields and modified situations to support both the Medicaid subrogation as it exists today as well as the other health plan types.

GOSS: Margaret, that is very helpful. It sounds to me like there are more business exchange rules that need to be understood to help the implementation guides enable a smoother transition for those outside of the Medicaid pay and chase environment and the industry saying that those are not mature enough at this point for a policy consideration of a broader application of an implementation guide that could handle some of the stuff, but maybe not as well as – it could be several years from now.

WEIKER: Correct. I know several of the commercial entities that were involved in the task group work, they showed spreadsheets they were receiving so we could look at the data elements, ensure we could crosswalk and that the data elements were in our standards. A lot of things are being done in very different formats and rules. In fact, some of the entities that process them are not really processors, PBMs. They are not adjudicated claims normally. This is just their business. They do not have a lot of experience with the telecom standard.

GOSS: Thank you.

COUSSOULE: Thank you all. That is very helpful.

GOSS: I am not seeing any hands up. I am thinking maybe we can turn it back to Lorraine to go to the next session for clearinghouses and vendors.

HINES: Before we do that, Denise Love – do you want to say hello that you are on the line?

LOVE: Yes. This is Denise Love. I am a member of the NCVHS Full Committee and Standards Subcommittee member.

Agenda Item: Session C: Clearinghouses and Vendors

DOO: All right. Great. Thank you. Thank you for everyone in this panel. It is getting us back on schedule. We are in good shape. We now have our clearinghouses and vendors. Are we going to be joined by Patrick Harris? I see you are on the phone. Thank you very much for joining us today. Do you have slides or will you be speaking freely?

HARRIS: Just speaking.

DOO: Excellent. We are happy to hear from you. You are free to share.

HARRIS: Thank you. I am Patrick Harris, Director of Business Development at RelayHealth Pharmacy Solutions. RelayHealth Pharmacy Solutions thanks the National Committee on Vital and Health Statistics and the Standards Subcommittee for the opportunity to share our perspective regarding industry implementation of the NCPDP Telecommunications Standard version F2 and the NCPDP Batch Standard Implementation Guide version 15.

RelayHealth manages more than 18 billion pharmacy transactions annually. We connect more than 50,000 US retail pharmacies with key health care stakeholders such as but not limited to physicians, health plans, pharmacy benefit managers, government agencies, and pharmaceutical manufacturers.

RelayHealth Pharmacy Solutions supports the advancements and adoption of NCPDP Telecommunication version F2. Through NCPDP’s consensus driven process, trading partners collaborated over a period of years to create version F2, so the industry will be equipped to manage existing and future critical business functions.

As mentioned multiple times earlier today, some of the more notable enhancements that version F2 offer are a change from a BIN number to an IIN number to support growth in the industry, an enhanced eligibility inquiry transaction also known as an E1 of the telecommunication standard will allow pharmacies to more efficiently coordinate benefits by providing additional beneficiary data to those efforts.

A new intermediary segment will better equip the industry to support REMS programs and other patient safety related programs. The enhancements of the pharmacy claims transaction will allow for additional financial data for payers to more accurately adjudicate coordination of benefits claims. Additionally, data elements that will identify payer sources are necessary to avoid manufacturer copay systems for beneficiaries with federal coverage and the adjudication program type will help covered entities comply with rapidly evolving state-specific requirements.

RelayHealth also supports for industry implementation of the NCPDP Batch Standard Implementation version guide 15. The batch standard is relied on by supplemental payers for reporting in transactions and must be modified minimally to support the new IIN number.

As a switch, RelayHealth’s core function is to facilitate the successful round-trip transmission of the HIPAA named NCPCP telecommunications transactions between pharmacies and PBM processors in real time. Additionally, switches support value-added programs based on the data elements contained within the NCPDP telecommunication standards.

Germaine to this industry implementation of telecommunication version F2, switches are often called upon by trading partners to provide term coding assistance to ensure transactions comport with the most currently named standard.

RelayHealth has traditionally been in a unique position to witness industry readiness during previous implementations of telecommunication versions 51 and D.0. With each previous industry implementation, RelayHealth has been required to shoulder incremental work to support covered entities during the implementation period.

Due to our historic experience with industry implementation of NCPDP telecommunication versions, we kindly offer the subcommittee’s consideration of the three following recommendations that we believe will positively impact the industry’s implementation of version F2. You will find that these align with the SNIP recommendations.

First, based on our experience, a minimum of three years will be necessary for the industry to implement a new version of the NCPDP telecommunication standard. Due to year end plan changes and new coverage period occurring on January 1, the implementation date should not occur at the beginning of the year. We recommend the implementation date occur in June.

Second, the transition period is necessary to allow trading partners adequate time for testing and dual use so they stagger their transition before a hard cut over date to F2. A gradual cut over date that provides industry time to allow for roll back and correction of coding errors will improve the transition to version F2. We recommend a minimum of a six-month timeframe prior to mandatory compliance for version F2.

Third, the mandatory compliance state for the industry to implement version F2 should be absolute and nonnegotiable. As a switch provider, we have experienced implementations of previous versions and we are keenly aware historically that there are a few outliers and are not prepared to start using a new version of the telecommunication standard by the mandatory implementation date.

During version changes, entities may make development priority decisions and experience opportunity costs to their business functions in order to comply with the mandatory compliant state. Allowing for a mandatory compliant state to be moved out an additional year for entities that have not adequately prepared for the version change creates an unintended consequence of punishing organizations that have worked hard to comply with the originally communicated data. We recommend that the initially communicated compliance date be nonnegotiable and absolute.

Our three recommendations for implementation align with SNIP and are intended to be combined into an overarching project timeline for the entire industry. By way of example, the mandatory compliance data is going to be in calendar year 2023. We recommend a mandatory cover date be June 1 of that year and that the June 1 cover date not be allowed to move.

RelayHealth believes that these three recommendations will facilitate a smoother, more streamlined implementation of version F2 than previous version implementations.

In closing, RelayHealth supports the transition from NCPDP telecommunication version D.0 to F2 and the Batch Standard Implementation version guide 15 and the SNIP proposed timelines for industry implementation. We thank the National Committee on Vital Health Statistics and the Standards Subcommittee for allowing us the opportunity to comment.

We look forward to working with industry stakeholders to advance the standards that will enhance health care operations, increase patient safety, and improve the industry’s ability to comply with rapidly evolving regulations. Thank you.

DOO: Thank you very much. I see they are queuing up the next presentation, which will have to be rotated 90 degrees for Leann Lewis. Is your line open?

LEWIS: Yes. Can you hear me?

DOO: Yes, we can. It looks like your presentation has been rectified. Thanks very much for joining us. Leann is with PDX. Whenever you are ready, please go ahead.

LEWIS: Well, good morning. My name is LeAnn Lewis. I am here to offer testimony on adopting the F2 standards and other standards as the next HIPAA standards.

I have worked in the pharmacy space for nearly 25 years and this will be my third implementation. Currently, I am director of industry relations at PDX, which is a company that has been a market leader in pharmacy management software and services for over 30 years. Over 10,000 pharmacies in the United States use PDX products or services.

Many of the speakers before me have extolled the benefits of the new standards. On behalf of PDX and having helped formulate NCPDP’s SNIP comments, PDX supports that the new standards have improvements that will do all the wonderful things previous speakers have detailed. Enhancement to patient care and safety. But more to the point, legislative, regulatory and industry changes necessitate this move.

I will simply state that PDX supports and recommends that this committee approve all the proposed NCPDP standards as the next HIPAA versions to keep all named standards in sync.

I wish to use my time to address some of the other questions posed by the committee prior to this meeting and will discuss more the mechanics of implementing a new HIPAA standard as well as discuss the proposed timeframe. Are there risks involved in updating the standard? Yes. There are short-term risks to patient care and access to their needed therapy. But the risks are associated with the process, not the new standard, a statement, which I will clarify in the next few minutes.

Does the new standard disrupt our current workflow – PDX has a software vendor. No. We are experienced in software development and have completed other HIPAA implementations. However, this is still a large project, which is costly and time consuming.

PDX and others must allocate man hours for staffing, planning, development, internal and external testing, documentation, training and support during transitions. It is tens of thousands of man hours from start to finish of the HIPAA implementation. And that is if all goes well. But will it?

Taking a look back at the D.0 transition, many entities fell behind suggested timelines. This is due to a myriad of factors including as others have mentioned, poor planning or budgeting resulting in lack of time or funds. There were competing priorities for the January 2012 HIPAA implementation of both NCPDP D.0 and the ASC X12 5010. In some cases, the 5010 had priority and the D.0 implementation suffered or fell behind.

There was a compliance date of January 1, 2012. With all the commercial, Medicare, and Medicaid plan changes, holidays and code freeze, no change as large as this should ever occur on January 1.

Concerning readiness from a vendor perspective. Intermediaries such as the switches were ready well in advance. That was wonderful. For payers, there are three scenarios. The best case. Most of the larger payers were ready as early as a year prior to the official compliance date. This included comprehensive testing platforms, certification packets and accepting of claims in the new version – bad case. One Medicaid completely missed the compliance date by nearly a year. Pharmacies were forced to submit claims in the old standard during that time. We respectfully add that protections be added to the final rule for HIPAA compliance pharmacies who are forced to use outdated standards for continuity of patient care due to payer’s unpreparedness.

Now a worst case scenario. Too many payers did hard cut overs on the compliance date. No testing was made available. Payer sheets were not available or inaccurate. A hard cut over had no backup plan upon failure. Defects in adjudicating claims resulted in rejections. Insufficient staffing or access on support desks all resulted in short-term patient care delays, the delays I mentioned earlier.

I know payers had similar issues with pharmacies and their vendors. Both sides contributed to the inefficiency which occurred on the first month or so of D.0.

A pharmacy like PDX strive to provide comprehensive testing of the software for new standards complete with certification and testing with as many payers as possible prior to the software release to the pharmacy partners. As Lisa Schwartz stated earlier with NCPA, our pharmacy partners also need additional time of approximately six months to perform chain or pharmacy specific requirement testing to successfully document and train staff and deploy the software. All of this takes time.

All stakeholders need to demonstrate complex coordination to minimize the risk to patient care and access to continued or particularly new course of therapy during transition. Again, the risk is in the process, not the standard itself.

Updating the standards should be a given. As Kathy stated earlier, stakeholders need to get started now particularly Medicaid agencies.

For those reasons, PDX concurs with NCPDP and suggests the following implementation timeframes. The two-year implementation period is inadequate. A three-year minimum is requested. Assuming a final rule is published in December of 2019, the final compliance date of June 2023 would be appropriate. However, depending on the timing of the final rule, PDX respectfully requests that the implementation period be adjusted to ensure that the final compliance date does not fall between November 1 and February 1.

In conclusion, I appreciate the opportunity to testify in favor of adopting F2 and the other standards. I would like to thank the committee for your time and thoughtful consideration of the PDX comments. I will be happy to take any questions at the end of the presentations.

DOO: Thank you. Kevin Crowe from QS1, are you here?

CROWE: I am. Good morning.

DOO: Wonderful. Good morning. Thank you for joining us.

CROWE: Thank you for allowing me to testify as well. QS1. We are a software vendor for mainly independent pharmacies, as well as for switching company for our pharmacies. We are sort of like what Leann said and Patrick said before. We kind of dabble in both of those little realms that we have.

One of the main thing is – QS1 is in favor of the F2 standard, having it implemented, and similar to what NCPDP has said, we do request at least a two-year period of time for us to develop a process once the rule has become final, and then a one-year implementation so that we can have both D.0 and F2 concurrently running at the same time to allow changes that need to be made, things that were missed by – or the third parties or the switches and so forth. That is a definite need is at least a 12-month implementation overlap between the two standards.

Like Patrick was saying and Leann also reiterated, we do need something on the back end to make it sure it happens. We have Medicaid, a couple of third parties that did not meet the deadline from the last time. That always causes problems because you are trying to (indiscernible) codes that is no longer needed, but then you are having to put stuff off on development cycles to maintain codes that is no longer by law, needed. That would be a great help as well as the mid-year implementation. January is always a rough time for the pharmacy industry just because as many people have stated before, there are lots of changes going on in the industry at that time. Code freezes and so forth. Our recommendation is to implement this in the middle of June in the middle of the year.

Another issue that comes up for our pharmacies, it will go along with the one-year implementation timeframe. These are all independent businesses. They all have their own timeframes – when they need to convert systems, releases, how they update their staff on how to use new releases. A six-month timeframe is really aggressive, and for these businesses, it could cause issues with their cash flow and so forth. Our recommendation is at least a minimum of 12 months of implementation time.

That is all the comments I have for today.

DOO: Okay. Thank you very, very much. Now, we have Laurie Schaeffer from the eRXNetwork. Laurie, are you with us.

SCHAEFFER: Good morning. I am. This is Laurie Schaeffer with eRXNetwork. eRXNetwork provides telecommunication infrastructure to the pharmacy industry and facilitates claim adjudication processes necessary for core retail pharmacy functions. We primarily serve regional pharmacy chains and independent pharmacies, handling nearly 2 billion transactions a year.

At risk of repetition of the points that have already been made by previous presenters, I will try to just leverage my time to focus on the highlights. As the clearinghouse for switch vendor for pharmacy transactions in the industry, eRXNetwork supports the NCPDP Telecommunications Standard and is anticipating the upgrade to version F2 upon communication of the final ruling. The Batch Subrogation Standard is not supported by eRXNetwork currently. The comments and the dialogues from our testimony will be limited to NCPDP Telecom Standard for F2.

eRXNetwork is the communication conduit between pharmacy providers and the payers and is all intermediary clearinghouses this position in the workflow requires an early adoption of the new standard to ensure accommodation readiness for any preliminary testing and certification with payers from the pharmacies to validate – success prior to requiring the providers to test and certify.

With the significant changes in version F2, the adoption will definitely require a broad array of changes to technical infrastructure platforms, tools, internal services, workflows, et cetera. While the benefits of the new version are definitely more measurable for the providers and payers in the industry, the adherence to the standard with the switch vendors is obviously – needs to be seamless and we do have some value-added services to the pharmacies and the payers as well as mentioned previously.

Historically, just to echo what Kevin was saying, the timely adoption and the firm mandate is critical. Those have been the barriers that we have seen in the past as well as effective and proactive communications among the industry stakeholders such as those third parties or with the provider payer sheets and so forth and then their commitment to the date that they have projected as their target adoption date.

The other anticipated barrier is the absence of an industry-wide test platform for the software vendors to perform any validation testing that ensures their development efforts adhere to the new version of the standard. That has been something that we have seen that is currently missing as well.

The transition to version F2 will begin with those software vendors and their readiness with development and testing and then followed by the pharmacies’ deployment of the software. There will be requirements that they may have to have hardware upgrades or software upgrades imposed and those costs that are involved there. We would say that at minimum should be a two-year period of transition that we certainly would be favorable with Annette’s suggested timeline earlier especially around the mid-year mandate. The first of the year would be far too critical as well as – you get too far into the end of the year around flu season. That would be problematic as well.

There are many attributes that have already been detailed on today’s call that will benefit the various stakeholders in the industry, including patients. There is an unknown burden for that change from a cost perspective as again I mentioned with hardware/software development resources, administrative process updates. These will be unique to each stakeholder – difficult to estimate as you posed in one of your questions without the final ruling for the standard and the urgency around that transition timeline.

If the applicable stakeholders will implement and take full advantage of the benefits of version F2 such as wider adoption of the transaction codes including determination of benefits, service transactions, et cetera along with many new fields and attributes. The patient experience and care impact could be greatly improved. However, it is not a great business concentration of hours. We are not able to formulate a very detailed answer around that.

If NCVHS does not recommend adoption of version F2, the results would definitely be less efficiency gained across the industry. The bigger problem with that delay would be their routing challenge that would be posed when those IIN numerators expand and the value from six spot to the 8 spot. The eRX has no opposition to the upgrade to version F2. There is no burden reduction to our stakeholder group in doing so. But again, we definitely want to have the same adherence to the new standard going forward.

Again, we just want to thank you for allowing us to participate as a panelist and provide testimony.

DOO: Thank you very much. That is our clearinghouse and vendor panel. Now, the Subcommittee may ask questions before you go into a discussion before you get to have lunch and everyone else gets to have lunch for our subrogation panel.

Alix and Nick, let’s have the Subcommittee members raise their hands if they have questions. Alix’s hand is already raised. Let me just look up and see if anybody else might have beat you to the punch. I do notice a question in the Q&A thing. Alix, why don’t you ask your questions?Agenda Item: Committee Q&A

GOSS: Thank you, Lorraine. It is for Laurie. I am not sure that I heard something fully or correctly, so I am hoping you can go back to your section of your commentary on the consistency of the testing framework. I wanted to see if you could just re-summarize that point to make sure I fully grasped the message that you were trying to deliver.

SCHAEFFER: As both the pharmacy software vendors and the third party payers are doing the development towards the adherence of the standard, one of the things that was beneficial in the 51 implementation was the ability – there was a player in the industry that allowed a test platform for software vendors and payer alike to depend on for that level of testing. The absence of an industry-wide test platform for the software vendors to leverage could be that it poses development delays or testing delays once they have their development coded, but then need to send to the processor and then find out that there are issues. It is just something that we have seen from a switch perspective that could be a barrier.

GOSS: I am not recalling the industry approach, which I believe was for the initial HIPAA adoption of the NCPDP transaction. Did someone step up during the D.0 migration or is it that you have seen the initial one in the D.0 and saying let’s bring this back into the realm of process verification to get to the adoption level?

SCHAEFFER: There was a player. It was a software vendor in the industry that allowed that level of testing from the implementation from 51 to D.0. It was a significant undertaking, I believe. We have not heard any interest in that being provisioned in the industry at this point.

WEIKER: This is Margaret with NCPDP. I just want to throw out that NCPDP is evaluating the impact and analysis of creating a test platform for version F2.

SCHAEFFER: That is great news, Margaret. I was not aware.

GOSS: Thank you, Margaret. I have one last question, which any of the panelists can choose to address. I am hearing from an implementation timeframe, clearly, do not do anything around the holidays. November to February, I think someone said, is a bad roll out time. I am hearing a Kumbaya around a June timeframe working. I am also hearing two years to implement. But then I am hearing an additional year for dual function of what would be D.0 and F2 to get us to the ultimate compliance date of June 2023. I want to make sure I am tracking on that correctly and if you all agree with that.

CROWE: This is Kevin from QS1. We do. Two years for development process should be sufficient. It may take longer. If we have that year implementation timeframe to take D.0 and F2 at the same time, that gives us a little buffer there and just in case things go on and then if we have testing as Margaret had mentioned with an outside entity. And then also during that two-year time, a development timeframe, we can also start testing with software vendors to the different payers and switches and so forth.

HARRIS: This is Patrick from RelayHealth. We also agree that a two-year timeframe minimally would be necessary with a one-year implementation timeframe. There are a lot of connections and covered entities out there that are going to need to coordinate with their intermediaries.

LEWIS: This is Leann with PDX and it is the same. We do not want every software vendor or we do not want every payer going live at the same time. It just creates too many service issues at point of care – negotiate the little idiosyncrasies that show up. We need the time to actually do it, the software vendors needing the time to do the testing prior to sending it out to the customers and then give the pharmacy partners the chance to do their own testing, do their own certification and go forward or roll back with the payers as it is available that if there are problems.

Because what happened with D.0 is there are times particularly when new therapy occurred that – maintenance med – diabetes. They knew the payer was eventually going to pay. You just had to get through the mechanics of the adjudication. If it is new therapy, they had no idea what the rules might be. And if the adjudication was failing and you could not get through the help desk and you could not get the claim to pay and it was an expensive med, that is what disrupts patient therapies. We need time to adjust to all of that.

SCHAEFFER: I was just going to say that I definitely concur with that timeframe and more so for our state plans who may require legislative approval in order to be able to build projects both around adoption of a new standard. The latency that is imposed there historically has been something we definitely need to consider so that we do not have – Medicaid that is falling out or extending well passed the mandate date.

DOO: Because they have to get fiscal approval to get their budgets through in order to start a new project.


PARTICIPANT: Does every pharmacy have to test with every payer or is it the vendors or your switches that will do the testing for their bevvy of contracted pharmacies and they will do that testing on behalf of the pharmacies to ensure that their systems are working?

CROWE: — software vendors that will do the testing with each payer and/or switch. There are few — require testing down to the pharmacy itself level, but those are few —

LEWIS: – implementation of how the payer is doing their testing. In some cases, they set up test platforms and provide test data. In other cases, at least in both 51 and D.0, the testing was done with live data so the pharmacies have the live data. The software vendors should not be dealing with that live data just due to the HIPAA regulations – that the pharmacy had to do the testing. The vendor could not.

HARRIS: Historically if we are testing the syntax of the claims. There has been work between software vendors, pharmacies, intermediaries. This is Patrick from RelayHealth. But I go back to I believe Margaret right now and NCPDP is looking at establishing a framework for a single testing platform – cases.

GOSS: This is Alix. I would like to ask – prior comments that I think Sharon made about certification. Is the NCPDP testing platform also looking at validating compliance from a certification type aspect, Margaret?

WEIKER: We are evaluating that.

KLOSS: This is Linda. My question really relates to all who have spoken this morning and I thank you very much. I think what is most notable is the wide industry consensus about the work that you have done so well at NCPDP.

Question. We have consensus around a new standard that really seems to reflect today’s reality and today’s needs, but yet we still struggle with an implementation timeframe that puts our ability to utilize the value that this new standard would bring five years out.

I guess I would just really appreciate some high-level discussion on how we move an industry to get to the point where we can take advantage of new work in a more timely basis than a half a decade out. I think this kind of goes to Nick’s opening question after the first set of testimonies. I understand all of the issues and the need to get it right and how hard it is to lift all – but we have an opportunity to do a lot of really important things. But it just seems like it takes so long to implement. Thank you.

SAFRENO: This is Mike Safreno answering for CVS and the payer side. One of the things about just the industry standard itself is the attempt to make it as flexible as possible in terms of attributes that can be applied to it. When we look at this, we are actually making changes every year through our emergency code list changes. What we are not allowed to make changes to in a year is essentially formatting changes. We cannot go and fundamentally change a standard in terms of adding additional fields or going out there and adding new types of segments. These are some of the things that take a significant amount of time to change the industry. And just speaking on our behalf, it will be probably hundreds of thousands of dollars of work.

In the meantime and as you go forward, you are allowed to make changes every year as long as it is agreed upon by the industry to the attributes. There are override codes. There are attributes in there. Reject codes can be added. There are a whole slew of things that can actually be changed annually and actually even quicker than annually.

DOO: Do we have any other questions – not seeing any hands up or even any other panelists who would like to respond to the prior questions.

GRAEFF: I think that when you look at a HIPAA standard especially, you are looking at 18 months maybe to get to a final rule of that five years out. There are some entities that really cannot do a lot before that time period. We have state legislatures that have to budget appropriate funds to Medicaid. We have some legislatures that do not meet every year. We have already missed this legislative season. I think there is just the structure that is going to impact that timeframe.

I think what industry is saying is really not – they are talking about using the standard sooner than five years out. But it is voluntary among trading partners sort of arrangement so that the patient is not going to be impacted if someone needs to roll back because of something unforeseen. I think a worst case scenario really is five years out.

DOO: Is there some suggestion that as people — what I did not hear – as people are ready, once their development and dual use as they are ready, is it between willing trading partners that would be a desire to use it, given all of the benefits that it provides?

KLOSS: Just as a follow-up, are there any ways in which that you see the process could be accelerated and not to say that – I guess that is just the question. Are there any barriers that could be addressed that might accelerate the adoption?

CROWE: This is Kevin. I really do not see much in the way of accelerating that because the legislative process to get it through and converted to HIPAA – that process is at least 18 months to go out and then the HIPAA regulations. You do not want pharmacies and developers to half way go through developing codes – HIPAA regulations to send it out untested or not ready to go for prime time. I think a two-year development cycle on the pharmacy and payer side is a minimum out there just because of the severity of the fines and issues that come up if something went wrong.

GRUTTADAURIA: This is Sharon from CVS Health and CVS Pharmacy. I am going to tag on to what Cathy Graeff had mentioned as well as Kevin. I think one of the barriers that we have or to reduce those barriers is for our legislative partners to come to NCPDP first before considering making changes in certain areas, coordinate those changes within NCPDP because what has been happening in the past is a retrospective solution where we need to work together to be prospective. We can build that standard that is more flexible and to accommodate what they may be considering. What are their goals? What are the legislative and regulatory goals that they are trying to achieve so that we can build that standard to support that?

LEWIS: This is Leann with PDX. To also kind of build on what Sharon is talking about, due to the flexibility of the current D.0 standard, there have been a number of items that have been added particularly to address the opioid crisis. Our external code list allows us the flexibility to do some of that to provide additional rejects, to provide additional adjudication tools to ensure that patient safety and still continue to move forward with this with some of the legislation that has —

WEIKER: This is Margaret. If you go back to the SNIP timeline that was created, we based the timeline on – we decided the date to have the NPRN released and we decided a date for the final rule in order to create the timeline. We have December of 2019. It is March of 2018 now. When you really look at it, we have basically a two-year implementation time period from that final rule. As others have said previously, a lot of entities wait for a final rule before they start the analysis and coding. You have legislatures that will not do anything until they see a final rule so they know when they have to allocate funds for that testing.

When you really look at it, we are talking like a two-year implementation with that additional one year for the compliance date.

DOO: Thank you. Any other hands? We do have comments in the Q&A. We will definitely compile those and share them with committee during their discussion. Thank you everyone who is sending those in as well. Everything will be useful to them. Please don’t hesitate to send comments and questions into me or to NCVHS. I think Rebecca had sent that also. Those comments will not be lost.

It is time for the committee to have their discussion before they are allowed to go for lunch. Let me just let the folks who are going to be speaking during the last part of our day for the subrogation piece, which I know will be really wonderful. You too are at liberty for lunch, but you must come back at 1:30. Do not disappear please. It is going to be a really wonderful presentation. I guess you can keep your computers on and you can keep your phone lines on too if it will not burn out your batteries. For those folks for the subrogation, if you would call back or just come back online at 1:30 that will be terrific. But the committee members – Alix and Nick, I guess I am going to defer to you. You are actually scheduled for discussion, but I do not know if you want to do this – actually, before people disappear. Would you like to have that discussion now? But I do not know about the WebEx tool. Does it have like a little pod or should we just do that now and just have the discussion before you break for lunch?

GOSS: Nick, I suspect you are having the same question that I am having right now. I feel that the subcommittee has been asking some questions. The testimonies have been quite clear. And that maybe it would be best if we had some industry questions that came through the Q&A that we could maybe elevate those questions since we still have those panelists on the phone. I cannot see the Q&A. I know that Rebecca may be in a technically challenged state at the moment.

HINES: I am. My WebEx did freeze. I will log back in during the lunch break. Lorraine, if there are any Q&A’s on the —

DOO: There is one that I can see. I do not know if I have access to everything. I tried to say thank you, but it did not go through. I will read you the one I have. I am not the boss of the system. I will just read this out. This is from Jeffrey Rogers who is on the WebEx. I am assuming if he is still on that he would be able to give – this is from earlier. There is mention about changing messaging between payers and point of sale systems. Our current experience is that point of sale systems does not always display all messages from the payer, for example, when the payer messages pharmacies when the claim is paid.

One, you could help explain that and then – rest of the folks who are experts to engage in the discussion about that. Thank you, Jeffrey.

GOSS: While they are doing that, is there anybody else from the WebEx support team who can click confirm or deny whether we have any more questions in the cue –

PARTICIPANT: You have no more questions in the cue and Jeffrey should be live now.

ROGERS: The basis of the question is I heard about messaging. I work with the State of Massachusetts with the Mass Health Pharmacy Program. We send out a lot of messages to our providers trying to provide different information using the free text messaging. A lot of times we run into issues when it is a paid claim. We will try to inform someone that is something is going to be turned off or there is a change coming. However, since it is a paid claim, most of the pharmacies do not see that information. Is that going to be taken into consideration with F2 when you are talking about more automated responses – denial where obviously it is important so they can get a pay claim – in the instance where – we, as a payer, want to convey additional information —

LANDON: It is Rich Landon. Can you clarify? Are you talking about a general push of information about the program or are you talking about information that is specific to an individual prescription or claim?

ROGERS: It would be to an individual. Say we denied a claim. Typically, you get the reject, but you also have the ability to push out 142 characters of information to the pharmacy to say it requires a prior authorization – it is a common one that we send out. Some payers go up or some pharmacy systems go up to the 140 characters. Some cut it off at 60. If it is a paid situation, the message most of the time we have been told does not even go up. If you – sorts of things into consideration —

GRUTTADAURIA: This is Sharon Gruttadauria from CVS Pharmacy. There is actually a means to do that in version D.0, but it is an implementation factor as well as having the right external code list values. It is very important that payers, entities such as yourself, participate in NCPDP so that we can identify your business needs.

There is a code value within version D.0 called approved message code that acts very similar as a reject code on a rejected claim. Understanding the business cases is very important so that pharmacy systems can go in and code and turn that text message that you are returning today into a codified message so that their systems can move the pharmacy team into the right workload steps.

With version F2, we actually added – what we did in version D.0 – the beauty of the NCPDP Telecom Standard is that we created some qualified message fields that in the next version become their own distinct response fields. We created 25 new ones in D0 that come back as a message field today, but qualified. But in the next version, they become their own fields.

ROGERS: Thank you, I will investigate that.

GRUTTADAURIA: Give me a call anytime. Be happy to help.

ROGERS: I appreciate it.

DOO: Great. That was useful. Thank you. Thanks for the question and thanks for the assistance, Sharon.

I am going to turn it over to Ruth and Michelle, because I do not see the other question. If you could provide them that would be great.

BENNETT: There are no other questions.

GOSS: I will ask if any of the subcommittee members have any questions bubbling up or anything you would like to take a few minutes to discuss before we break for lunch while we still have all of the panelists. Deb, Denise, Linda, no need to be shy.

PARTICIPANT: I do not have any questions. Thank you.

GOSS: Linda, I know you already some questions, but do you have anymore?


MS GOSS: Nick, over to you.

COUSSOULE: I think we are good for now, Alix.

GOSS: It is always great when you think you are behind and then you actually catch up and then some. What I am going to propose is that it is just nice when you – what I am going to propose is that it is just 12:22 since we have a different set of panelists coming for the afternoon, I suggest that we go ahead and break a few minutes early for lunch, resuming promptly at 1:30.

Before we do that, I want to ask the WebEx hosting folks if they have a preference whether people stay on or disconnect and then reconnect. What would you prefer those of us who are rejoining at 1:30 to do?

BENNETT: I would say really it is up to each individual. We would suggest that you disconnect and then reconnect, but whatever you feel most comfortable with.

GOSS: We will talk to everybody at 1:30 again. Thank you again to all the morning panelists who may not be joining us in the afternoon. Very insightful and useful information. You guys are a wealth of good details. We appreciate your time and energy to support this hearing.

(Lunch Break)

A F T E R N O O N  S E S S I O N  (1:30 p.m.)

Agenda Item: Part 2: NCPDP Subrogation

HINES: Welcome again to the afternoon portion of the National Committee on Vital and Health Statistics Meeting of the Standard Subcommittee, NCPDP Standards Update Hearing. I do not think we need to repeat roll call. We can see on the screen the committee members that are here. Thanks to all of you who are with us. If you would like us to know or take your name down for attendance, other guests, please enter your name and email in the chat.

Just a reminder on logistics for those of you who were not here this morning, just to review those quickly, if you are a presenter testifying, you will have between seven and eight minutes. Since we do not have visual cues, I will one minute before your time is up just send you a note in the chat box and then we will ring a bell. If you hit the magic eight-minute mark, then you do need to wrap up as you are able.

After each group of panelists presents, Alix and Nick will lead us in a discussion, ask questions of the panelists and also panelists from the other sections if you are still on with us. We will have an opportunity for public comment at the end of the day and I will put a note in the chat box. You can also send comments to our email, You can also raise your hand and you will be called on to speak when we get to the public comment part of the day. You can also send public comment in the chat box if you would like.

If you have any technical difficulties, please email Michele Dillon who is running the WebEx. You should have her email. I will it in the chat box, but one more time, Finally, please self-mute your phone if you are not speaking. But for all of our sanity, please do not put our phone on hold if you are in a corporate phone environment. That means we get to hear your music. Please avoid putting yourself on hold. Either put yourself on mute or hang up and dial back in. I think those are all the key reminders.

Lorraine, add anything that I may have missed.

DOO: Just one, the reminder, although we have all been on many different kinds of webinars before, there is a little raised hand feature under the participant list if you are looking at that. That is what enables you to ask a question or to respond to a comment. I am not able to point to it, but our hosts would be able to. But that is how you can put a little hand by your name to let Alix or Nick know that you want to ask a question or make a comment. Use that. It will put a hand by your hand so that we know to call on you. Please use that. It does make it easier particularly when we are doing the Q&A or the discussion part. I just wanted to remind people about that. I know that there are so many different systems that we are using these days with a plethora of those.

That is the only other thing that I wanted to add. Thank you all for coming back. I hope you all did not eat anything that was too heavy on your stomachs although hopefully you are in a bright place. I, for one, am very excited about this section.

The NCPDP subrogation. I think there are actually a lot of questions about this. I think it will be very interesting. The first speaker is Bill Shircliff from the Rawlings Company. I believe he is on. I do not know if there are slides for this or not.

Part 2: NCPDP Subrogation

SHIRCLIFF: Good afternoon. This is Bill Shircliff. We did not produce slides for today, but submitted written. I was going to just refer to that.

DOO: Welcome and thanks very much for joining us. The phone is yours.

SHIRCLIFF: Terrific. Good afternoon members of the NVCHS Standards Subcommittee. Again, this is Bill Shircliff. I am president of the Pharmacy Committee of the Rawlings Company. We appreciate the opportunity to present our testimony today regarding the adoption of the Subrogation Implementation Guide for Batch Standard Version 10.

The Rawlings Company is one of the nation’s largest providers of payment integrity services for health care plans with over 1400 employees focused solely on claim payment error avoidance, detection, and correction. We are a trusted business partner to many leading national health plans that cross – throughout various business segments in the industry including Medicare, Medicaid Management Care, as well as commercial insurance payers.

Our responses that we have provided represent our perspectives based on well over a decade of experiences representing these leading national health plans in post-payment pharmacy subrogation matters.

I would like to first start by saying the Rawlings Company strongly supports the adoption of the NCPDP Subrogation Implementation Guide for Batch Standard as it will significantly improve the efficiency and effectiveness of data exchange and transaction process for payers involved in post-payment subrogation, which eventually end up leading to achieving payment accuracy across the industry.

As I mentioned a moment ago, we have submitted our written testimony to a number of the questions presented by NCVHS for industry responses. And today, I wanted to just highlight a few of our key comments for consideration by NCVHS.

First of all, the subrogation standard is really critically needed by the industry. It will provide the framework to replace industry efforts in this area that are currently handled largely through various electronic manual as well as other ad hoc processes. These processes are highly ineffective and thus inefficient for all parties involved. Examples of these processes include submissions via non-submission of claims, via non-standard electronic files that are in various different formats and that can be different across payers and processes as well as multiple paper claim submission processes in some cases.

Next, the subrogation standards will produce significant savings for health care payers and third party processors by substantially reducing administrative expenses and increasing the payment reconciliation that is needed between payers.

Through the reduction of these existing ad hoc and manual processes and the related improvements in payment reconciliation, all stakeholders involve will experience significant improvements in savings in both claims and administration expenses.

We have been involved with the industry for quite a while and the statistics with members with multiple insurance coverage represent about 5 percent of health care membership across the industry. Applying national drug expenditure estimates, the volume of claim reconciliation and savings opportunity can easily exceed a billion dollars in this area. The need for these effective processes again is critical.

Finally, the probability of success for the subrogation standard is high. It has been modeled after the well-established Medicaid subrogation standard that was discussed earlier. Through the NCPDP, they are facilitating a very extensive and collaborative process for the evaluation, development, and recommendation of the subrogation standard and the related implementation guide. This process included over two years of discussion that included a wide range of key industry stakeholders representing health plans, PBMs, processors, pharmacies, and other vendor organizations including the Rawlings Company.

As mentioned previously, the standard is based on the Medicaid subrogation standard and therefore the implementation for the broader usage will be less challenging than perhaps otherwise would have been. NCPDP is also very well positioned to develop education and orientation materials as it is regularly drawing upon subject matter experts to reach consensus on key industry issues and provide guidance.

The Rawlings Company has significant experience in these areas and would be pleased to assist in the development of materials to help ensure success.

Members of the Standard Subcommittee, again, I thank you for the opportunity to testify in this important industry topic for your consideration. Again, we are very much in support of the adoption of the NCPDP Subrogation Implementation Guide for Batch Standard and we look forward to continuing our efforts to work with NCPDP and industry stakeholders on this initiative.

I will be staying on the line if there are any questions as the discussions continue. Thank you again.

DOO: Thank you very much. Now, I think Shelly is on the line, but I did not – are you planning to speak?

WINSTON: I am from Medicare Part D. My name is Shelly Winston. Typically, we have not spoken at these meetings, but I think that some of the issues before you, Part D has interest in. We just wanted to support the proposed subrogation standard. We think it is a first step to filling a need that the industry is really clamoring for. We realize that it is just going to begin with the Medicaid standard, but we see this as a beginning. We understand that adjustments will be needed down the road, but we just wanted to certainly advocate for the standard. We also think that it is time to name the F2 standard as well on the telecommunication side.

Just brief statements from the policy side and just wanted to thank you for asking for our opinion on this.

DOO: Thank you. You are coming at it from Medicare Part D.


DOO: Thank you very much. I know you submitted written comments as well.


DOO: Great. We do have Colleen Palmer.

PALMER: Hello. This is Colleen Palmer. I appreciate the time to present today. I am project manager with the Government Programs Office with DST Pharmacy Solutions. Again, thank you for the opportunity to present testimony concerning the adoption of the Subrogation Implementation Guide for Batch Standard Version 10. The current standard is limited to the subrogation of Medicaid claims. The process used for subrogation of non-Medicaid claims differs by payers. The new standard expands the use and increases the interoperability by making the subrogation available for use by other payer types, including Medicare Part D plans and commercial payers, in addition to Medicaid. Kathy Knapp discussed earlier in the F2 section that DST Pharmacy Solutions formerly known as Argus Health Systems is a leading provider of health care information management services supporting commercial Medicaid and Part D plans.

I just wanted to touch on a couple of the questions. Number one. How is this activity being enhanced today? It was discussed earlier that subrogation activity varies by payer type. Today, DST Pharmacy Solutions experience is a majority of the Medicaid claims are submitted via the NCPDP Medicaid Subrogation Batch Standard and are submitted on a batch method. Medicare Part D commercial payer claims submitted through either a spreadsheet or a universal claims form often as paper, which requires manual processing.

Question 4. What system changes would be required? For entities currently using Medicaid subrogation standards, system impacts would include the processing of additional data elements in the new standard and modifications to accept electronic submissions from additional subrogation payer types.

What type of education would be needed and also who are the best subject matter experts? As with all new standards that have not been utilized stakeholder groups, the implementation guides that accompany the actual standard are the best source of information. We must make sure as an industry that this material is user friendly and easy to understand by individuals with technical and operational roles in the organization. The subject matter experts for subrogation standard would be pharmacy benefit managers and vendors that currently support the functionally today, along with NCPDP. As the DSMO supporting standard, NCPDP is one of the best sources in the industry to provide education on the structure and the use of the transaction itself.

Again, I would like to thank the Subcommittee for the opportunity to present today. I will be available for the question portion later on. Thank you again.

DOO: Thank you, Colleen. Next, we have Andrea Kent from Conduent.

KENT: Good afternoon everyone. I do have a presentation and I can certainly send it to you after we go through my portion. Thank you. I appreciate it.

Good afternoon. First of all, I would like to thank the National Committee of Vital and Health Statistics for allowing me to testify for the industry implementation of the Subrogation Implementation Guide for Batch Standard Version 10.

My name is Andrea Kent and I am with the Pharmacy Benefit Management System Product Manager with Conduent. We have decades of experience with commercial HMOs, state Medicaid agencies, insurance administrators, self-insured employer groups, state employee benefit programs, and workers compensation programs as well as senior drug program.

We have a national presence serving pharmacy benefit management and clinical service programs in 19 states and the District of Columbia. We also process more than 259 million pharmacy claims for more than 17 million Medicaid members every year using the NCPDP D.0 transaction standards.

Today, we follow the Medicaid Subrogation Batch Standard by using the fields identified within the implementation guide to create a claim to be sent to the other carriers. Today, this is a very manual process because the carriers that we do work with are not actually following the standard because of the majority of the other payers that we do send those claims to are commercial carriers who are not required to use the batch standard.

Benefits to the new standards include any pharmacy benefit manager who can use the new standard. It is not just limited to Medicaid agencies or payers. Also, it improves transparency – subrogated pricing between trading partners. It also reduces cost for pharmacy benefit managers outside of Medicaid if they adopt a standard.

The challenges in the business and operational workflows. This could lead to some claim adjustments based on the information received from the other payers. However, the benefits in cost reduction are far greater than the amount that it would cost to do claim adjustments.

Also, the administrative efforts to coordinate benefits with the other payers would also create some challenges in getting those processes up and running to ensure that those benefits are correct and making sure that the hierarchy of payers is accurate within each payer system.

Also, another challenge would be to implement the batch processing software. Not all payers today use that software so they would have to implement that and ensure that it is in compliance with the standard today.

System changes that are required would be the implementation of other payer reject codes. Payers would need to ensure that they are editing on those and how they are going to create their business process to ensure that the other payer reject codes trigger what we call the pay and chase process in which one of those other payer reject codes would trigger that process to be started and to basically trigger the batch standard.

Also, they would need to implement the batch processing software and then also as mentioned earlier, changes to support additional fields in the new standard for any entities that are using the standard today.

Also, as mentioned earlier, the education of the new standard, pharmacy benefit managers other than Medicaid will need training and guidance on how to implement the new standard and the best way to get that training is through NCPDP membership and task groups and attending those as well as Medicaid agencies or payers who are currently using the standard can provide insight on how to implement.

Additionally, some financial impacts would be software to ensure that the software is able to support the new batch standard and then also secure hardware to ensure that personal health information is protected, any transaction fees if any and then also switch vendor costs. These would be impacted to the entity that is implementing the new standard and then also on the receiving end as well, but again minimal impact to financial side compared to the benefits.

The benefits do include that payers could be paying less for claims as another party is responsible for the claims. And then also a standard would be used to determine the information sent and received, which eliminates the usage of many different file types or layouts. The same standard can be used throughout the industry and not just between Medicaid payers.

That concludes my presentation. Thank you for the invitation to testify today for this very important topic.

DOO: Thank you. It was very clear. We will now be hearing from some state Medicaid programs. I think that we have at least folks who will be joining us and we are very grateful for that. The first is Patrick Tighe representing Ohio Medicaid I believe. Patrick, is your line open?

TIGHE: Yes. Can you hear me okay?

DOO: Yes. Perfectly.

TIGHE: I am the National TPL TAG Chair. I represent all the other state Medicaid agencies for third party liability for Medicaid. We do agree with the standardization. As was mentioned earlier, Medicaid has been in the forefront where there is some standardization, but as always, the process can be improved.

We also run into the problem where we find Medicare D is primary to Medicaid. And a lot of the states use a vendor for this process, that vendor being HMS. And also some states do the billing on their own, which is why I have some states with this that also do their own billing so they can share some of their concerns and also HMS is on the call in case they want to add some points too. But we do look forward to having some standardization with this to improve the process. As mentioned earlier, it is a time saving measure and also a money saving measure.

DOO: Do you want to add anything or is Margaret going to speak from California?

HOFFEDITZ: Margaret is here if you can hear me. Nothing really more to add other than we too are supportive of standardization. I think very good points have been made before this. Nothing additional to add.

DOO: We have Brian Dodge who is on the phone from HMS. You should give a better explanation of the services that you provide for the state so if you could do that so I do not mess it up.

DODGE: Sure. As Pat mentioned, we do already provide the – we have been through the migration of moving from the old subrogation, which was not really enforced at all in the old 5.0 into the standardized model with the D.0 and the version 3.0.

Everybody has already mentioned. I will just simply echo the sentiments already said. The standardization has actually made the administrative process easier. Obviously, with any implementation, there will be costs involved and additional processing that will have to be implemented within each system.

But I think one of the advantages though is that since we have already gone through a lot of the growing pains of the Medicaid specific subrogation, the gap between that and what we are trying to accomplish with the F2 and more specifically the version 10 subrogation standard that the leap is not as great. I think one advantage one of the PBMs will have is that the basic processing infrastructure is more or less already there. There are obviously gaps between what Medicaid subrogation is versus what commercial subrogation is, but I think that gap is much smaller than what it was when we implemented the version 3.0 back in 2012.

We have already established a lot of relationships with the PBMs out there to facilitate this. That is my perspective is that we have really seen that a lot of them already have that penetration of this kind of processing model in place. The extension beyond that I do not think would be a terribly huge gap. Speaking on behalf of the commercial side, I cannot really say much. But that is our experience on the Medicaid side.

DOO: Alix or Nick, I was going to ask if either Patrick or Margaret could explain what the interface would be between Medicaid and let’s say, the Part D program so that all the committee members would have the same understanding of it. Would that be helpful if one of them just walked through how that would work under current or future scenario?

COUSSOULE: I think that would be very helpful.

TIGHE: I will try to do that and then I will have Brian chime in and then Margaret can fill in. The way it would usually work is if Medicaid finds out that let’s say Medicare is granted retroactively, which happens quite often, and Medicaid paid primary. then what will happen is the person should have a Part D plan and a Part D plan may be granted retroactively. Medicaid has paid a claim primary.

What will happen is let’s say Medicaid may have to go after SilverScript or some other Part D plan, to be able to get reimbursed for a script that Medicaid paid as primary. It works similar to the way it does for the Medco, CVS and Caremark for over the retail side, commercial side, but Medicare Part D adds a little bit more complexity to it.

If Brian or Margaret, if you want to add in more, please.

HOFFEDITZ: From our side, Pat, this is Margaret, you accurately described it. We do not have anything else to add.

DODGE: Just one thing. This is Brian with HMS. I do recall in the early phases of implementing the Part D retroactive processing, there was a handful of extra fields that will require for the PDEs, but I do not remember it being that huge of a list. I think that was really the primary difference between the commercial subrogation and one that was Part D related.

DOO: Right now, you are able to use the Medicaid – you use the Medicaid subrogation 3.0 and you can take that – the pharmacies will be able to identify the fees that are due, and the patient is not impacted by that. They do not get an extra billing.

If the subrogation version 10 were to be used and other payers were to use it, and then Shelly, you can weigh in too, if the Part D plans were to use it sort of play out what that scenario would look like so that people could see what the traffic flow of the transactions would be because that is what they are trying to put together in a recommendation whether it is mandatory or voluntary. How would that look for industry?

TIGHE: If we had to include those extra fields for Part D, would we need to include them for the commercial world too?

DOO: — played out both ways.

TIGHE: To me, it is whatever is agreed to, we would have to follow it. But I was trying to think if I have a – it would be nice if there is a standard format whether it is commercial or Medicare Part D, you would follow the same format. But for something specific for Medicare Part D, it would have to be specified what rules or format would need to be followed for that.

I would say that as long as the state Medicaid agencies are at the table, we can come to some agreement.

Brian, is there any preference from the vendor side from HMS or from Rawlings or Conduent?

DODGE: No, I would echo that same sentiment as long as we can just agree what that standard is. I do not have any preference other than that. I know that there are different requirements at the back end occasionally that may differ – this is a while ago that we had to tackle these. I do not recall there being – it was maybe one or two extra things that – for the PBEs. I think it is a pretty standard thing that we could all agree on to your point.

DOO: It sounds like you are saying you probably have to go back to a table and the plans would have – there would be some discussion about how it would work.

SHIRCLIFF: This is Bill Shircliff. I would just add if I am understanding the question correctly. I think the standard itself lays out the protocols for exchanging the data to get the claims payment accuracy. There are two points to clarify. One is as you move toward Medicare and commercial markets, the determination of the order of benefits is very different from Medicaid, but that would be done in advance before submitting claims over for reimbursement under subrogation.

As it relates to Medicare Part D on the back end with PDEs, I think that was really viewed as a separate process, allowing Medicare plans to more effectively identify Medicare secondary payer situations for reconciliation is important for Part D plans because it does impact downstream PDE processing. But that, again, would be subject to a separate process outside of the subrogation standard.

GOSS: To be sure I understand your term, will you please define PDE?

SHIRCLIFF: Sure. That is Prescription Drug Event that is the recording of the claim. Shelly, you may have a more exact description. But it is the recording of the Drug Prescription Event that is reported back to CMS by Medicare Part D.

WINSTON: It is more than a claim. It includes any kind of reversals or adjustments.

GOSS: This has been a really interesting discussion. This is Alix. This morning we really heard the subrogation guides are good to go for Medicaid. We do not want to tip toe into the larger policy discussion and have this apply to everybody, all payers. But I am starting to feel like this afternoon we are hearing a slightly different tone, which is it is really a proven base standard in which subrogation is built. We have a lot of use and experience in Medicaid existing implementations. Commercial has been at the table in the standards development, but not quite related to fully jump in. Plus there are a few – it sounds like data elements or guidelines that will still be needed in the implementation guides.

But my sense is that the commentary related to standardization would really be fully achieved if everybody was on the same guide for payer-to-payer recruitment.

TIGHE: I would say yes.

GOSS: When did – going be ready for that type of broad usage? I see Bill’s hand up.

SHIRCLIFF: This is Bill. Margaret, I might defer back to you. I know NCPDP’s task group – there was discussion around this topic. From the processes, controls and processes that were going to be established by the processors, the PBMs, given that it is different than Medicaid seem to be some of the talking points that came up about why getting some proven track record first before mandating it seem to be the direction that generally the consensus wanted to go. I do not know that I have a specific answer to the date, but that was the process that was discussed within NCPDP.

WEIKER: I agree with Bill. He summarized it very well.

GOSS: If we are talking about a 2023 recommendation from NCPDP and their SNIP process reinforced by industry testimony, we would be looking at something in the mid to late-2020s before industry would likely have something to develop and bring it forward. Am I extrapolating appropriately?

WEIKER: I would say yes at this point in time. This is Margaret with NCPDP. As Bill said, we did not discuss a date specific like 18 months after Medicaid then we would take forward for all other payer types. We never had that type of discussion about that timeframe.

GOSS: Thank you, Margaret. It is hard sometimes when you are in the development process to forecast that far out especially when you are just trying to wrangle the next version. It seems to me that the testimony has been pretty clear today that standardization is working. We are getting benefits from patient safety to cost efficiencies and return on investment and workflows – trying to figure out since this seems to be the only bubbling issue so far on the subrogation is that what is policy scope. I am trying to figure out the benefit what I think I heard Bill say earlier. I may have recorded this wrong. About 5 percent of patients have multiple insurances and that is an estimated one billion dollar market.

DOO: — at that one billion dollar number too is what that represented.

SHIRCLIFF: This is Bill Shircliff. The 5 percent is an average, not that all 5 percent – a good majority of that is all correctly paid in advance. It is just a fraction of that that is left to address in a subrogation setting.

GOSS: I see that Nick’s hand is up as well as Annette. I am not sure if Nick you are chiming on the same topic or have a question or if Annette wants to weigh in on the discussion we are having currently.

COUSSOULE: I have a question on the same topic, Alix. Maybe it is for Margaret.

(interruption on phone with background conversation)

COUSSOULE: Maybe this is a question for Margaret or the other panelists now. How much interest from payers or others and not processing Medicaid, but processing commercial claims or Part D? Have you seen to be able to use this more rapidly than the timeframe, Alix, just expounded on a minute ago?

GOSS: Nick, who were you directing that at?

COUSSOULE: Maybe towards Margaret or NCPDP, but also for others to weigh in. I am just trying to understand the – it is clear the value and the updated standard. I am trying to understand how much have the other industry players that may not be processing Medicaid claims this way be interested in trying to use this sooner than what the implementation guidelines for this update might look like. If that much value can be generated, is there a way for that to happen faster or within the current standard?

TIGHE: This is Pat. I will just speak from my experience working in the commercial world. Back when I worked with an insurance company, we had to subrogate pharmacy claims when a group went from our insurance carrier to another or they came from another carrier. What would happen is we would have to go through and do a manual process to get the other PBM to pay the claims. It was not automated. It is not as large as the Medicaid amount that is out there, but it is still in a portion where instead of working on spreadsheets, it would be nice if there was a standard format that those commercial carriers could use.

COUSSOULE: I get the challenge. I work for a commercial health plan. I am just trying to understand what kind of feedback came in from those kinds of plans in regards to this current update to the standards or is it more of a – we like it and we would like to be able to look at it, but it is not a pressing issue today for them. I am just trying to understand that from more of the development process and the recommendations that came forth.

GOSS: We also have Leann’s hand up and Annette has been up for a while. I do not know if they are looking to make comment on this question. Let’s let Annette go first and then Leann.

GABEL: To answer the question and I think you are asking specifically about the Medicaid subrogation now being more of a subrogation for all payers. There is a need for commercial subrogation. It does exist today. Those that are trying to use the standard to do processing for commercial claims are using this Medicaid subrogation standard. But there were some additional pieces of information that they needed in the standard to be able to use it. The standard was updated. While they were in there making those changes, they also expanded the use that basically allowed commercial payers to use it because it was specifically slated for Medicaid and the commercial payers wanted to have a way that they could communicate between each other in a more standard fashion.

There is a not a huge need for this as I think. I am not sure who just spoke and said that there is an occasional need for them to subrogate between them. It is more about providing information on payers that paid that should not have paid and providing the information to the payer that should have paid. Those instances do not happen that often, but they do happen. The industry was looking for a way to be able to point to a standard so that when they get a request to do this, they do not have to code a different method every time the situation comes up. That is really the need that existed in the industry and the reason why they updated the standard and change the requirement to allow commercial payers to use it as well as Medicaid. I hope that answers the question. If not, clarify a little bit better what you are looking for and I will see if I can answer it for you.

COUSSOULE: I think that is very helpful. Thank you.

GOSS: Leann, you had your hand up. Do you have a comment?

LEWIS: I am wondering if the hurdle here is the fact that we are only wanting it mandated for Medicaid and not all other payers. I believe part of the discussion that may have been going on at the time was that this is kind of new in looking at commercial payers. We believe we have everything in the standard that we need to be done for that. However, there might be some hiccup as it starts to go into full use since it cannot be used for commercial payers previously. With it being a main standard, if there is some sort of issue with it, it will make it a lot more difficult to gain adoption with it until it becomes named or until it becomes named – enough diversion whereas if there does appear to be an issue with it, something could be done – another version put forth that would remedy those problems prior to another naming of a HIPAA standard.

GOSS: Thank you. I see Bill’s hand up.

SHIRCLIFF: Thank you. I would add again that commercial and Medicare D are both interested parties in seeing this move forward. I think back to the question of what was in place today with Medicaid and this was going to – the purpose was to get this approved to be mandated for Medicaid and then allow some utilization for adjustments or tweaking as needed for the other business segments. I do think that there is support across the industry for all business segments.

GOSS: Thank you. Nick, did you have any other questions?

COUSSOULE: Not from me. Thank you.

GOSS: How about other subcommittee members?

KLOSS: This is Linda. Not from me. I am good.

DOO: Annette already made her comment. Did you have another one?

GABEL: No, I do not.

Agenda Item: Discussion

DOO: No other questions for subrogation right now. Thank you for that panel and discussion. That was a lot of really good information. I still have a lot of notes to parse through, but thank you very much for all being here this afternoon and for giving a lot of really good food for thought and a lot of answers to questions I think that have been burning for a long time. That concludes the session and the official hearing.

And now is supposed to be the time when the committee would actually be going through the discussion. The committee has time to debate and compare and contrast amongst themselves and then would be the public comment time. This is your opportunity to have a free willing discussion about everything that you have heard and learned today amongst the committee members, which has been a lot.

For the committee members, this is your opportunity now to have a robust discussion amongst yourselves and ask each other questions and decide how you want to handle everything that you have gleaned.

GOSS: Before we jump into that, are there any Q&A’s that we may have not seen from the industry and people who are attending? I think we have covered all of them. I know there has been some great clarifying commentary from Monique, giving us extra perspective. But I want to make sure we are not missing anything else before we as a Subcommittee talk about things for a bit before our formal – public comment.

DOO: Michelle or Ruth, are there anything in the Q&A.

HINES: This is Rebecca. There is nothing in the Q&A since this morning. There is nothing other than some clarifying comments from Monique in the chat. Do you want those read out loud?

GOSS: They look to me to be comments that are reinforcing the additional input we received from Annette and Leann responding to Nick’s question. I think I am accurate on that.

Hearing no other concerns, I think we should – Subcommittee back up a little bit. I just got a message. I do not know if we can accelerate the public comment period, Nick. That is why – input at that point.

HINES: It is your call when you are done discussing. That would be the point at which we would have public comment and if we are ahead of time, which is fine.

LANDEN: Alix. It is Rich. For discussions like this in the event there is public input that might be nice to hear before we conclude our discussion.

PARTICIPANT: I was having the same thought process, Rich.

HINES: As of this moment, we have received no written comments either in the chat, the Q&A features of the WebEx or in the mailbox. Unless somebody has verbal public comment at this time, did you want to do a pre-public comment before the committee discussion, Alix?

GOSS: Yes, I would like to hear if anybody has any comments that they would like to make about what they have heard this morning or this afternoon. If you do, you can raise your hand just to let us know on the WebEx so that we can make sure to call upon you. It looks like Annette Gabel is already in the cue.

GABEL: I cannot figure out how to get my hand down. Thank you.

GOSS: Are there any other folks who want to raise their hand or chime in whether they are a panelist or an attendee?

While we are waiting to see if folks have feedback, let’s just, as a subcommittee, start to get our creative juices going a little bit. We have had some really great feedback today from industry participants and standards developing teams. It seems like there has been a tremendous amount of industry collaboration in advance of them coming to this hearing. When I talk about industry collaboration, I am talking about more than just the standards development – I am really referring to what is going to look like when we need to implement and get to a successful adoption of an upgrade NCPDP set of standards.

For me, it is kind of uplifting when I look back at my 20 some years of experience with all the goodness of HIPAA and seen our 4010, our A1, our 5010 and then the corresponding NCPDP transaction standards adopted. It seems that we are learning our lessons and we are applying them.

I think it was very interesting to hear the commentary about let’s take two years to implement and then basically have an additional year so we could do the cut over. Run dual systems. Work out the bugs before we actually have the compliance date. It seems to me that that was a nice way to address the challenges of getting people to upgrade pre the federal hammer of a final rule sort of the chicken and egg dynamic. It seems that this is a creative way around that conundrum if I heard things correctly.

KLOSS: Alix, this is Linda. I do not know how to raise my hand. I am sorry that I am hand raising challenged here today. I wanted to echo what you said. I am just amazed at the level of consensus that has been developed. Kudos to the process that clearly brought very complex industry to consensus around this.

I had two questions. One, does that additional year or does the process formally call for introduction of end-to-end testing? I know we have talked about that in the past as something that is just really highly valuable. People collaborating with one another and doing partner testing is kind of maybe not the same as a formal end-to-end processing step. That is one point.

And the second question I had was is there any perspective that we did not hear from today that we had hoped to hear from today. Thanks and I will go back on mute.

GOSS: Don’t go too far because I think you want people – are you looking for the Subcommittee to answer and have a discussion on that or are you looking for some of our panelists to chime in on your end-to-end —

KLOSS: The panelists on the end-to-end and then really anybody on whether there are any perspectives that are missing from today’s discussion.

GOSS: I see Sharon. Lorraine, am I managing the hand raising or are you?

DOO: I can manage it. I am just going to say if Linda would look above the Q&A or the chat, there is a little hand on the right hand side. All you have to do is click that little hand.

KLOSS: I am just not seeing it.

DOO: I see Sharon’s hand. You are already unmuted.

GRUTTADAURIA: Thank you. This is Sharon Gruttadauria from CVS Pharmacy. To address Linda’s question on the – hopefully, to address – provide additional input on the end-to-end testing.

Actually the first question that was on the written testimony really speaks to this because what are the areas that are impacted for the implementation. As part of my written testimony, I called out the different areas, which kind of backs up why we need that one full year because in addition to the business IT planning and development and internal and external testing, there is training. There are operational procedures that need to be evaluated to see if anything needs to be changed as well as administrative processes, contractual relationships. Because of the new components like the REMS segment within version F2, we may have new relationships with intermediaries where that relationship has to be established. Contracts have to be put in place. The testing with those intermediaries has to occur.

Even with the relationships between the pharmacies and the payers – some of the new data elements or situations of use, the way we change some of the things particularly around compound claims processing. We made some major changes around making those attributes and values to align with USP terminology so we can harmonize and create interoperability. As a result of that, the reimbursement for compound claims and that contractual relationship may change. That has to all be incorporated. That all has to fit in that one-year period of after you finished your testing to deploy it.

On the pharmacy side, I know that Leann mentioned that – I think it was Leann that they have 180 different software vendors on the pharmacy side. It is very similar on the pharmacy side. We have about 180 to 200 payer systems that we need to test and deploy with. All of that has to compact and fit into that one-year period.

DOO: This is Lorraine Doo. I think that scope, the hundreds of thousands of testing action that have to take place was made clear by you and a number of other people. It makes it I think all of us realize how substantial that whole – we always talk about end-to-end testing, but I do not think we really put numbers to it the way people have put numbers to it today.

GRUTTADAURIA: It is so much more than just flipping a switch.

DOO: Yes. It is the number of exchanges, the number of entities that have to do that.

KLOSS: Thank you for underscoring that.

GOSS: It looks like Leann Lewis wants to make a comment on that topic and maybe Annette. It looks like Rich took his question down.

DOO: I saw that. Thanks for tag-teaming, Alix. Leann Lewis.

LEWIS: Just to expand on Sharon’s comments. Yes, there is all the contracting. But we also provide a service that maintains payer sheets and claim formats for our customers. Currently, I believe that service is maintaining nearly 700 different payer sheets, which is potentially 700 payers or claim situations, which have to be worked through over the course of the transition. The longer period of time that people have to do that as well as for payers to stagger as long as they come in, the easier and the less impactful it will be to that final patient who is walking in going where is my prescription. I am sorry. I cannot get it to pay. It is a $400 prescription or a $1700 prescription.

COUSSOULE: Can you define a payer sheet for me?

DOO: Yes. I was just going to ask her to talk about that because – they mentioned them a lot today and a lot of people do not know what those are.

LEWIS: I will do my best. And, Margaret Weiker, if I do poorly, please follow up after me. The NCPDP F2 standard is flexible. There are fields that are mandated and there are fields that are situational.

Now when it comes to the situational fields, all of that is defined by a payer in their payer sheet saying these particular segments are required. These particular fields are required. Those payer sheets dictate that so that the pharmacy can set up the claim format as the payer is expecting it under certain circumstances as Sharon had mentioned. If it is a REMS claim then that has to be there. If it is not a REMS claim then it contains information that is not needed to process the claim and we are trying to stay within the minimum data needs requirements. We are not exposing data that does not need to be going across the line just for the payment of the claim.

DOO: They are a little like companion guides for the X12 transactions. Did you want to add anything, Margaret? Nick, is that clear for you?

WEIKER: Let me answer the question. Does he need more explanation?

COUSSOULE: No. That is what I thought it was. I was not sure we were all talking about the same thing.

DOO: Thank you, Leann and Margaret. Annette, did you have your hand up?

GABEL: I wanted to respond to the end-to-end question that was asked earlier. When I think of end-to-end, I think of claim submission all the way through payments. One of the things that we did last time and I think SNIP is going to undertake this again this time probably in a different manner is that we created test scenarios and put out a white paper in a couple of different work groups in NCPDP. One of the things that we did was we wanted to make sure that the industry was testing the claims all the way through the 835 on the payment side. I think that is going to be even more important this time around because the F2 standard will move by itself hopefully as an updated standard. And X12 is not ready with their version of the 835 yet.

I think it is going to be important that when NCPDP puts together information from a SNIP perspective that we indicate that there is a need to do the testing from the claim all the way through the 835 payment.

GOSS: That is a really interesting point that you bring up, Annette, because this will be the first time that we have not moved toward the medical and pharmacy transaction to the full HIPAA upgrade. I am going to take a little gander here and say that there is likely to be support for moving forward the NCPDP implementation guide put forth in the discussion today and knowing that we are not going to have the 730 versions for some unforeseen period of time in the future. It is going to be a bit of a change prior to implementation.

GABEL: Right. It will definitely be a change. But I think that the recommendation that will come from SNIP is that the X12 standard should be tested as we move through the production of the F2 standard.

WEIKER: This is Margaret. What we did last time is we created a cross walk between the paid response of a telecommunication transaction to the 835 TR3 so entities would know where to map the field from the response into the 835. We, again, will do that using the F2 paid response into the version 5010 TR3s since that is the mandated version. And then whenever X12 moves forward with their next version then when that comes about, we will again go in and update that and then cross walk it to 730.

GOSS: Margaret, thank you.

DOO: Did anybody of all the panelists want to try to address Linda’s other question, which was about who is not at the table, which I think is a really important one?

WEIKER: This is Margaret from NCPDP. When you look at it, we have many different types of pharmacies. We have retail. We have independent. We have long-term care. We have heard from those today. There are other types of pharmacies, compounding pharmacies. There are pharmacies that testified today that do compounding. There are specialty pharmacies. There are pharmacies that have a specialty line of business and/or a payer that may have a mail order specialty pharmacy or a vendor that supports specialty pharmacy and they were asked to testify. I do not know if the payer that had the mail order add anything in regard to mail order or if they just looked at it from a process of PBM point of view. Most entities have other lines of business besides their primary line of business.

I do not think though we have any hospital pharmacies. They do use our standard. I do not believe we had those. They do not participate at a great rate at NCPDP.

DOO: We invited them actually —

WEIKER: I was thinking that too as soon as I started down that. We tried, Lorraine, to get them here. Off the top of my head, we had for the Medicaids. We have Medicare Part D. We have PBM and processors that have lines of business across the plethora of lines of business and plans and benefits. We have software vendors. We have the switches relay and the eRXNetwork who did the switching or act like a clearinghouse as well as provide other types of services.

Off the top of my head, I cannot think – we do not have the manufacturers. Some of this is related in regard to rebates. But that comes as the claim is processed. The claim is paid. And then the information then flows down into rebates. Will this impact them? Yes from a rebate point of view. The rebate standard would have to be updated for the additional field if they are needed from a rebate point of view.

We have a work group seven. That is our rebate standard work group. They are well aware of the changes to F2 and know that they would have to update their standard after they do the analysis to determine do we really need to update our standard at this point.

Unless somebody else can think of somebody.

(Whereupon, the meeting adjourned at 2:48 p.m.)