PURPOSE: This rule establishes a Pharmacy Federal Reimbursement Allowance and the methodologies to determine the formula for the amount of allowance each pharmacy is required to pay for the privilege of providing outpatient prescription drugs.

1. (1) Pharmacy Reimbursement Allowance (PRA). PRA shall be assessed as described in this section.

   1. (A) Definitions.

      1. 1. Department—Department of Social

Services.

1. 2. Director—Director of Department of

Social Services.

1. 3. Division—Division of Medical

Services.

1. 4. Monthly gross retail prescription

receipts—For ease of administration for the department as well as the industry, this shall be an annual amount. The basis of tax in any fiscal year will be the gross prescription sales of the last calendar year prior to the previous fiscal year.

1. (B) Each pharmacy engaging in the business of providing outpatient prescription drugs in Missouri to the general public shall pay a PRA.

   1. 1. The PRA owed for existing pharma-

cies shall be calculated by multiplying the pharmacy’s total gross retail prescription receipts by the tax rate determined by the department. Subject to the limitations established in section 538.520, RSMo, the range of such said tax rate shall be uniformly distributed in bands determined by a ratio of total Medicaid prescriptions divided by total sales and shall not exceed six percent (6%).

1. 2. The PRA shall be divided by and col-

lected over the number of months for which the PRA is effective.

1. 3. The initial PRA owed by a newly

licensed pharmacy shall be calculated by estimating the total prescription sales and multiplying the estimate by the rate determined by the department.

1. 4. If a pharmacy ceases to provide out-

patient prescription drugs to the general public, the pharmacy is not required to pay the PRA during the time it did not provide outpatient prescription drugs.

1. 5. If the pharmacy reopens, it shall

resume paying the PRA. It shall owe the same PRA as it did prior to closing, if the PRA has not changed per paragraph (1)(B)1.

1. (C) Each pharmacy shall submit an affidavit to the department with the following information:

   1. 1. Pharmacy name;
   2. 2. Contact;
   3. 3. Telephone number;
   4. 4. Address;
   5. 5. Federal tax ID number;
   6. 6. Medicaid pharmacy number (if

applicable);

1. 7. Pharmacy sales (total);
2. 8. Medicaid pharmacy sales;
3. 9. Number of paid Medicaid prescrip-

tion; and

1. 10. Gross receipts attributable to pre-

scription drugs that are delivered directly to the patient via common carrier, by mail, or a courier service.

1. (D) The department shall prepare a confirmation schedule of the information provided by each pharmacy and the amount of PRA that is due from the pharmacy.

2. (E) Each pharmacy shall review the information prepared by the department and the amount of PRA calculated by the department to verify that the information is correct.

   1. 1. If the information supplied by the

department is incorrect, the facility, within thirty (30) calendar days of receiving the confirmation schedule must notify the division and explain the correction.

1. 2. If the division does not receive cor-

rected information within thirty (30) calendar days, it will be assumed to be correct, unless the pharmacy files a protest in accordance with subsection (2)(D) of this regulation.

1. (2) Payment of the PRA.

   1. (A) Offset.

      1. 1. Each pharmacy may request that its

PRA offset against any Missouri Medicaid payment due to that pharmacy.

1. A. A statement authorizing the offset

must be on file with the division before any offset may be made relative to the PRA by the pharmacy.

1. B. Assessments shall be allocated and

deducted over the applicable service period.

1. C. Any balance due after the offset

shall be remitted to the Director of the Department of Revenue and be deposited in the state treasury to the credit of the Pharmacy Reimbursement Allowance Fund.

1. D. If the remittance is not received

before the next Medicaid payment cycle, the division shall offset the balance due from that check.

1. (B) Check.

   1. 1. If no offset has been authorized by the

pharmacy, the division will begin collecting the pharmacy reimbursement allowance on the first day of each month for the preceding months.

1. 2. The PRA shall be remitted by the

pharmacy to the department. The remittance shall be made payable to the Director of the Department of Revenue and be deposited in the state treasury to the credit of the Pharmacy Reimbursement Allowance Fund.

1. (C) Failure to comply with this request for information or failure to pay the PRA.

   1. 1. If a pharmacy fails to comply with a

request for information from the Division of Medical Services or fails to pay its PRA within thirty (30) days of notice, the PRA shall be delinquent.

1. 2. For any delinquent PRA, the depart-

ment may:

1. A. Proceed to enforce the state’s lien

of the property of the pharmacy;

1. B. Cancel or refuse to issue, extend or

reinstate the Medicaid provider agreement; or

1. C. Seek denial, suspension or revoca-

tion of license granted under Chapter 338, RSMo.

1. 3. The new owner, as a result of a

change in ownership, shall have his/her PRA paid by the same method the previous owner elected.

1. (D) Each pharmacy, upon receiving written notice of the final determination of its PRA, may file a protest with the director of the department setting forth the grounds on which the protest is based, within thirty (30) days from the date of receipt of written notice from the department. The director of the department shall reconsider the determination and, if the pharmacy so requested, grant the pharmacy a hearing to be held within forty-five (45) days after the protest was filed, unless extended by agreement between the pharmacy and the director. The director shall issue a final decision within forty-five

1. (45) days of the completion of the hearing. After a final decision by the director, a pharmacy’s appeal of the director’s final decision shall be to the Administrative Hearing Commission in accordance with sections 208.156, RSMo 2000 and 621.055, RSMo Supp. 2001.

   1. (E) PRA Rates.

      1. 1. The PRA tax rates will be done in

bands and will be determined by the ratio of paid Medicaid claims to total prescription sales. 13 CSR 70-20

1. 2. The maximum rate shall be six per-

cent (6%).

1. 3. Adjustments will be made to the tax

rate if the average Medicaid prescription charge for an individual entity is statistically different than that of the other entities in the assigned tax band.

AUTHORITY: section 208.201, RSMo 2000 and 338.505, RSMo Supp. 2003.* Emergency rule filed June 20, 2002, effective July 1, 2002, expired Feb. 27, 2003. Original rule filed July 15, 2002, effective Feb. 28, 2003. Amended: Filed Feb. 3, 2003, effective Aug. 30, 2003. Amended: Filed Nov. 3, 2003, effective April 30, 2004. *Original authority: 208.201, RSMo 1987; and 338.505, RSMo 2002.