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Practice Management Alert

Documentation Determines Off-Label Drug Payment

Published on Thu May 01, 2003

Don't automatically write off off-label drug use in your practice. Payers may frequently deny their reimbursement, but with ample documentation, you may see payment for those frequent and expensive charges.

The key to securing off-label drug payment is the documentation you use to support its medical need, safety and acceptability among physicians. Many drugs used or administered in a doctor's office or clinic, especially those for chemotherapy, fall under off-label drug guidelines. They apply not only to drugs that the U.S. Food and Drug Administration (FDA) has not generally approved but also to drugs prescribed or ordered for a different population group such as children instead of adults or at a different dose or duration than that which the FDA approved and reviewed, says Crystal Rice, trade media liaison for the Center for Drug Evaluation and Research at the FDA in Maryland.

If your physician prescribed or ordered an FDA approved drug for a patient belonging to a different population or sub-group deemed to have a favorable risk-benefit ratio, then that drug qualifies as off-label use, Rice says. In this case, you need to follow off-label protocol.

Follow This Simple Procedure

"Stop, drop and roll" doesn't just protect you from fire it can prevent off-label drug denials that can be as high as $50,000 per claim. If you're charging off-label drugs, Stop your electronic claims submissions, Drop to paper, and Roll in the documentation.

This plan is your "best bet" for seeing reimbursement for ordered or prescribed off-label drugs, says Carolyn Davis, CMA, CPC, CCP, CCS-P, CPHT, TMC, the billing supervisor for Oncology Hematology West in Papillion, Neb., and a professional coding and continuing-education instructor at Iowa Western Community College.

1. Stop electronic claims submissions. Electronic claims are your one-way ticket to off-label drug denials. When you submit them, payers will automatically send you either a prepay audit or a denial based on medical necessity, Davis warns. You should also stop electronic submissions for new drugs that you report with unlisted-procedure codes. You'll have a tough time getting paid because the description and national drug code (NDC) may not transmit electronically to your payers, she says.

2. Drop to paper. You will need to submit additional information to get off-label drugs paid, and you can present that information most effectively if you drop your claim to paper at the very beginning, before denials, Davis says.

3. Roll in documentation. There's no two ways around it: You must document the justification for using off-label drugs, and that requirement is substantial. Davis calls documentation the "key piece" to receive payment not only for off-label but also for new drugs.

  • You must provide data from clinical trials that supports off-label drug use. Your physician can help or provide you with this information. You can submit clinical evidence from one of three sources: the compendia (USP DI, AHFS Drug Information); phase III clinical trials (for Medicare approval, the trial must include a defined combination and dosage schedule, appropriate study design, adequate number of study subjects and evidence of significant decrease in tumor size or reduction in tumor-related symptoms); and peer-reviewed medical literature.

    You can request relevant articles directly from your drug representatives or pharmaceutical companies, or take them from the different sources listed in Medicare's guidelines, Davis says. Obtaining the information from the drug company and submitting it is "a big step" to seeing payment, she says.

  • You must provide documentation from the medical record that demonstrates the medical need for using the drugs and clearly indicates the condition the drug treats. Make sure the documentation also illustrates previous treatments that have failed, Davis adds.

    Meet with your physicians if you don't have the documentation for off-label use, Davis says. Ask them to explain to you the reason for the drug use, for example whether mortality or morbidity factors in. Gather the correct information for your documentation before you send in the claim, she says. Physicians will be more than happy to assist you especially when you're looking at these high-dollar codes.

    Ace Appeals

    If you receive a denial for your off-label drugs, don't back down and write off payments that average thousands of dollars per claim. Instead, appeal these claims with thorough documentation.

    Prepare your practice for the appeals by keeping an ongoing file of information and articles from published sources that you can use to back up your charges.

    Remember to justify every procedure, not just your off-label drug use, on your claim when you appeal denied payments, Davis says. If you have an E/M code billed out with chemotherapy, for example, attach to the appeal the physician's documentation, the flow sheets, the nursing notes and the drug article information to justify your entire claim, she says.

    If you continue to submit evidence justifying your claim and denials keep showing up, call the reimbursement hotline of the drug companies and ask them "to go to bat for you" to secure payment, Davis says. If payers still deny you payment despite a physician's letter justifying medical necessity and copies of journal articles, consider asking for an administrative hearing.

    Payers Vary in Payment

    You can't expect every payer to reimburse or deny your off-label drug claims, so don't determine your claim submission based on one stringent or one generous payer's policy.

    Medicaid may deny payment for an expensive drug that's an injection or a drug that could potentially be misused or abused, but Medicaid is not as strict as Medicare, says Beth Mauer, Pharm. D., MBA, at Deloitte & Touche, an international professional services organization that offers healthcare consulting, among other services. Medicare pays for very few drugs, and the submission/verification process is slow, she says.

    Your commercial payers won't pay either if they know the drug is off-label, she warns. If you're reporting an off-label drug that many people are using, however, commercial payers may reimburse, she adds.

    One way to avoid denials from commercial payers is to report the treatment regimen during the precertification process. If the insurance company gives you coverage approval for a specific off-label use, that payer will have a tough time justifying a denial.

     

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