Tricare and Immunizations

Many times I have made the following statement at the front of a room: "The only payers you can't negotiate with are Medicare and the state-run Medicaids.  Everyone else will negotiate."  Everyone, that is, except for Tricare.  Tricare, as most of you know, is the "private" insurance that covers the families of those who serve in the armed services when they are not seen on-base.  The coverage, as anyone who participates knows, is generally poor ("Well visits until age six...") and the reimbursement is even worse.  Our clients who are located near large military bases often suffer as a result and you can see a number of threads on PedTalk discussing this problem.

The other day, Dr. Barden got in touch with me to see if we could track down the pricing for some immunizations as they are paid by CMS.  I think it started with the Flu shot. This is one of those funny questions, as CMS doesn't actually have RVUs for immunizations, but they do have pricing established for a number of them (I never reference that data, as I don't always know how to make it an apple:apple thing).  Anyway, he wanted this information because he noticed that he was being paid less for some of his vaccines by Tricare than they cost him.  I am shocked, shocked I tell you!

This is what he was told by his Tricare rep:

CPT code 90669 is on the Medicare J-Code pricing file and the rate of $78.80 was established in March 2008. Per TRICARE Reimbursement Manual, Chapter 1,Section 15, if a code appears on this file the contractor is to reimbursed at this rate. Drugs that do not appear on the Medicare J-code pricing file will be priced using 95% of the AWP.
I am not sure how often the Medicare J code pricing gets updated but it has not been updated since March of this year. This is truly a problem that has to go up the chain to get resolved. DOD will have to make this change. If the code came off the listing such as Guardisil, it is paid at 95% of AWP. This is why some vaccines get updated quarterly and others seem to stay at a certain rate even though companies are increasing the price.

I think it was Q here at PCC who tracked down the important link:

Influenza and Pneumococcal Vaccines Pricing

Dr. Barden then gathered a series of spreadsheets and created one himself that I think anyone working with Tricare ought to be familiar with.  Thanks for the effort.  His pre-amble first:

I am still concerned with the way Tricare bases it's pricing of payments on 95% of the CMS (Medicare) payment cap. I have put together a spreadsheet that lists all of the vaccines that pediatricians commonly use, their CPT codes, ICD-9 codes, descriptions, CDC Cost, and the Tricare payments and the Medicare payment limits. This data (Tricare) is accurate at least for NC. There are about 5 vaccines that Tricare does not pay more than cost. I have included some of the CMS pricing documents as well. This is an odd system of pricing. As the military is reducing pediatricians, I suspect we may be seeing more Tricare. Hopefully they will price vaccines on 128% of the CDC price - not 95% of the 106% of ASP that Medicare uses.
Anyway, the spread sheet is pretty helpful even without the pricing data.
-Graham Barden

Transmittal 1623 - or "SUBJECT: Influenza Vaccine and the Pneumococcal Vaccine Payment Allowances Based on 95 Percent of the Average Wholesale Price (AWP)"

CMS ASP Pricing File for Sep-Dec 2008

Dr. Barden's Magic Tricare-CDC-CMS Pricing File