Medicare Part D Coverage Gap Discount Program Agreement

This information is necessary not only to make specific payments, but also to help producers meet their obligations under generally accepted accounting principles (GAAP) and the Sarbanes-Oxley Act or applicable international accounting standards and laws. GaAP, for example, requires producers to recognize customer discounts when the sale is recognized. This coverage often requires a complex forecast of the amounts of the rebates, taking into account the different contracts concluded for the manufacturer`s products. In addition, Sarbanes-Oxley (SOX) requires certain SEC reports to certify that the financial statements and other information contained in the report are appropriate on all essential aspects of the company`s financial position and results. Detailed data is useful for certifying the amounts of payment contained in the financial statements. We note that the availability of this level of data is also compatible with HIPAA. The Ministry of Health and Human Services expressly authorizes companies covered by HIPAA to transmit information such as prescription numbers to a manufacturer in order to query applications under a drug delivery contract. Since the amount of the rebate is based on the use of drugs by individual participants, this information is authorized in the context of the payment activities of an insured company and is consistent with restrictions on the provision of the minimum amount of data required, provided that the company provides the minimum amount of information necessary to assess claims arising from the contract. CMS included in the draft model agreement a provision requiring the manufacturer to use the information disclosed under the agreement only for the payment of the rebate under the rebate program. BIO supports this provision, which requires manufacturers not to use data received for purposes other than planning, creating or verifying rebate payments. We believe that this requirement should provide CMS with reasonable assurance that the data provided under the agreement will be treated confidentially, while the necessary information will be made available to manufacturers to verify payments. III.

Manufacturer Discount Date – Section II (b) CMS suggests that manufacturers understand the total amount of the invoice at 14 days from receipt, including all amounts at issue. BIO is concerned that 14 days is not enough for producers to process payments made under the program, particularly because of the criminal provisions related to the non-payment of sponsors in a timely manner. This is particularly the case when CMS maintains its proposed approach, where producers must make separate payments to up to 300 different Part D sponsors. We propose that CMS be prepared to pay at least 60 days from the time acceptable data is received for manufacturers. A 14-day payment period does not correspond to payment deadlines, among other government rebate programs or industry standards in similar commercial programs. The payment period under the Medicaid rebate program is currently 30 days (or rather 38 days to allow for delays). Tricare allows 70 days of payment by the manufacturer. These are appropriate deadlines for long-term programs, under which a manufacturer writes a single check to each state, such as Medicaid, or a single check for the program, as in Tricare.

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