41NHA-S3992 - PEBP Exhibit B - Definitions.docx
DOCX document 30 KB Posted
- Attached to
- Nevada State Pharmacy Benefit Manager
- Solicitation number
- 41NHA-S3992
- Issued by
- Nevada
About this file
This document is Exhibit B of a Pharmacy Benefits Manager (PBM) contract for the Nevada Health Authority, containing comprehensive definitions of key terms and concepts used throughout the pharmacy benefit program agreement. The exhibit establishes standardized definitions for claim types, drug classifications, pricing methodologies, and administrative processes that govern the PBM's operations. The definitions cover approximately 66 distinct terms including 340B Claims, Administrative Fees, Authorized Generic Drugs, Average Wholesale Price (AWP), Brand Drugs, Generic Drugs, Biosimilars, Specialty Drugs, mail order claims, retail claims, and various claim subcategories such as Government Claims, Indian Health Service/Tribal/Urban Claims, Long-Term Care Claims, and Home Infusion Claims. The document also defines financial and operational metrics including Ingredient Cost, Dispensing Fees, Gross Drug Cost, Actual Acquisition Cost (AAC), and Rebates, establishing objective, claims-identifiable criteria derived from standard third-party reference data such as Medi-Span pricing guides and First DataBank classifications.
The definitions establish stringent requirements for the PBM's financial reporting and proposal evaluation, with repeated stipulations that modifications to key definitions—particularly those for Brand Drugs, Generic Drugs, House Generics, Specialty Drugs, and Rebates—may negatively impact the contractor's financial proposal evaluation. The document mandates that AWP be updated at least weekly using Medi-Span files, that all Rebates be fully passed through to the Sponsor and be auditable at the claim level, and that the PBM derive no additional revenue or compensation beyond disclosed Administrative Fees. Pricing methodologies referenced include NADAC-plus pricing and Pass-Through arrangements, wherein the PBM invoices the Client the identical amounts reimbursed to retail pharmacies with no additional revenue or indirect value derived from paid claims except for specified administrative service fees.
View the file
Other files
Show all 22
On GovTribe
Work with this file
- Download the original file
- Contacts named in this file
- Similar government files
- Ask GovTribe AI about this file
Text version
Exhibit B - Definitions
| E1.1 | "340B Claims" means: (i) claims submitted by 340B contracted pharmacies that adjudicate at a 340B price or are submitted with a submission clarification code of "20" or such equivalent codes for such Participating Pharmacies under the applicable NCPDP format (or any successor format); (ii) claims submitted by a 340B covered entity-owned or 340B contracted pharmacies which are categorized as Type 39 (or such equivalent codes) in the NCPDP DataQ database or otherwise identified as a 340B Claim by the dispensing pharmacy. Claims adjudicated at a PBM-owned, -operated, or -affiliated mail or specialty pharmacy will not be considered 340B Claims. This definition shall be applied for financial evaluation and reconciliation purposes using objective, claims-identifiable criteria derived from standard, third-party reference data, as specified herein. Any proposed modification must be expressed using the same framework. Failure to comply with this requirement may impact the evaluation of Contractor's financial proposal. |
| E1.2 | “Administrative Fee” means the fixed fee payable by Client to Contractor on a PMPM, PEPM, per Paid Claim, or other mutually agreed basis for the administration and management of the Pharmacy Benefit Program. The Administrative Fee shall include all compensation received by Contractor and its Affiliates for performing Services under this Agreement, including, but not limited to, standard administrative, operational, clinical, formulary management, utilization management, rebate administration, and account management services. Except as otherwise expressly disclosed and approved by Client in this Agreement, Contractor shall not receive or retain any additional compensation, fee, spread, margin, markup, or other direct or indirect remuneration related to the administration of the Pharmacy Benefit Program. Administrative Fees shall be separately identifiable and independently supportable for each major service component, including Retail, Mail, Specialty, Rebate Administration, and Clinical Services. |
| E1.3 | "Authorized Generic Drug" means any drug sold, licensed, or marketed under a new drug application (NDA) approved by the Food and Drug Administration (FDA) under section 505(c) of the Federal Food, Drug and Cosmetic Act (FFDCA) that is marketed, sold or distributed under a different labeler code, product code, trade name, trademark, or packaging (other than repackaging the listed drug for use in institutions) than the brand name drug. Authorized Generic Drug shall be defined with the definition that is rooted in the law, 42 CFR 447.502. for the entirety of the Agreement. However, the definition described herein shall NOT affect the determination of Drug Classification for the purposes of financial reconciliation and guarantees. |
| E1.4 | "AWP" means the post-litigation average wholesale price of a Covered Drug as identified by the drug pricing source, Medi-Span Prescription Pricing Guide with supplements (Medi-Span), based on the NDC-11 of the product used, as of the date filled, as reported by Medi-Span. Claim-level AWP shall not in any way be calculated, altered, adjusted or assigned an alternate NDC number. This includes products with a new NDC number assigned by a repackager, manufacturer, or mail / specialty order facility that differs from the original manufacturer AWP price for the same product. PBM agrees to update AWP at least weekly using the most up-to-date files Medi-Span. This definition shall be applied for financial evaluation and reconciliation purposes using objective, claims-identifiable criteria derived from standard, third-party reference data, as specified herein. Any proposed modification must be expressed using the same framework. Failure to comply with this requirement may impact the evaluation of Contractor's financial proposal. |
| E1.5 | "Contractor" means the organization, including any "Contractor's Affiliate" (any other company / organization that owns or controls the Contractor), making a formal offer for pharmacy benefit management (PBM) services for Client. Since the RFP Questions and Responses will be incorporated into the final contract, "Selected PBM" means the selected Contractor. |
| E1.6 | "Biosimilar” means an FDA-approved type of biological product that is highly similar to and has no clinically meaningful differences in terms of safety and effectiveness from its respective FDA-approved biological reference product, under Section 351(k) of the Public Health Service Act, as added by the Biologics Price Competition and Innovation Act of 2009. |
| E1.7 | "Brand Drug" means a drug or product designated with the Medi- Span multisource code field of "M," "N," or "O" as of the date of fill. This definition shall be applied for financial evaluation and reconciliation purposes using objective, claims-identifiable criteria derived from standard, third-party reference data, as specified herein. Any proposed modification must be expressed using the same framework. Failure to comply with this requirement may impact the evaluation of Contractor's financial proposal. |
| E1.8 | "Change of Control" means one or a series of transactions related to (i) the sale of assets of a party exceeding fifty percent (50%); (ii) any merger, takeover, consolidation or acquisition of a party with, by or into another corporation, entity or person; or (iii) a transfer of a party's issued and outstanding shares exceeding fifty percent (50%). |
| E1.9 | "Claim" means a drug, over the counter (OTC) product, product, supplies, devices, digital software-based therapeutics, and any other item that is processed and paid through PBM's adjudication system or otherwise transmitted / processed by the PBM in accordance with Client's applicable benefit plan design. Any per Claim fees will be calculated using approved and paid Claims only, and will exclude all rejected, withdrawn, denied and / or reversed Claims. |
| E1.10 | "COB Claim" means a Claim submitted to the Selected PBM for which the Client's drug benefits are secondary to one or more other entities providing other prescription drug coverage for the Member. |
| E1.11 | "Compound Drug" means a medication that requires compounding by a pharmacist because it is not available from a pharmaceutical manufacturer in the prescribed form or strength. Compound Drugs may consist of two or more solid, semi-solid, or liquids, at least one of which is a Covered Drug. Compound Drug excludes the addition of only water, alcohol, coloring, flavoring, and/or sodium chloride solutions, or the like to any preparation. |
| E1.12 | "Contract" means the executed Contractor and Client pharmacy benefit services agreement including any and all exhibits, attachments, addendums, updates, and amendments. |
| E1.13 | "Cost Share" means the amount a Member is required to pay for a Covered Product in accordance with the Client's Plan. Cost Share may include, but is not necessarily limited to: copayments, coinsurance, deductibles, penalties, transaction fees, access fees, and / or other ancillary fees for which a Member is responsible for paying. |
| E1.14 | "Covered Drug" or "Covered Product" means a drug, medication, supply, product, device, digital software-based therapeutic, and / or any other item covered or treated as covered pursuant to a benefit determination, override, or appeal, under the Client's Plan. |
| E1.15 | "DAW-0" (No product selection indicated) means the Prescriber has made no indication on the prescription and may be appropriately used for single source Brand Drug and Generic Drug products. |
| E1.16 | "DAW-1" (Substitution Not Allowed by Prescriber) means the prescriber indicates, in a manner specified by prevailing law, that the product is to be Dispensed as Written. |
| E1.17 | "DAW-2" (Substitution Allowed: Patient Requested Product Dispensed) means the prescriber has indicated, in a manner specified by prevailing law, that Generic Drug substitution is permitted, and the patient requests the Brand Drug product. |
| E1.18 | "DAW-3" (Substitution Allowed: Pharmacist Selected Product Dispensed) means the prescriber has indicated, in a manner specified by prevailing law, that Generic Drug substitution is permitted, and the pharmacist determines that the Brand Drug product should be dispensed. |
| E1.19 | "DAW-4" (Substitution Allowed: Generic Drug Not in Stock) means the prescriber has indicated, in a manner specified by prevailing law, that Generic Drug substitution is permitted, and the Brand Drug product is dispensed since a currently marketed Generic Drug is not stocked in the pharmacy. |
| E1.20 | "DAW-5" (Substitution Allowed: Brand Drug Dispensed as a Generic Drug) means the prescriber has indicated, in a manner specified by prevailing law, that Generic Drug substitution is permitted, and the pharmacist is utilizing the Brand Drug product as the Generic Drug entity. Except as described in this paragraph, the DAW of a Claim shall not affect the determination of Drug Classification. |
| E1.21 | "DAW-6" (Override) is not recognized. Any single source Brand Drug or Generic Drug prescription coded as DAW-6 by the prescriber is defaulted to DAW-0. |
| E1.22 | "DAW-7" (Substitution Not Allowed: Brand Drug Mandated by Law) means the prescriber has indicated, in a manner specified by prevailing law, that Generic Drug substitution is permitted but prevailing law or regulation prohibits the substitution of a Brand Drug product even though Generic Drug versions of the product may be available in the marketplace. |
| E1.23 | "DAW-8" (Substitution Allowed: Generic Drug Not Available in the marketplace) means the prescriber has indicated, in a manner specified by prevailing law, that Generic Drug substitution is permitted, and the Brand Drug product is dispensed since the Generic Drug is not currently manufactured, distributed, or is temporarily unavailable. |
| E1.24 | "DAW-9" (Other/Substitution Allowed: Plan Requests Brand Drug Dispensed) means the prescriber has indicated, in a manner specified by prevailing law, that Generic Drug substitution is permitted, but the Plan's Formulary requests the Brand Drug product to be dispensed. |
| E1.25 | "Direct Member Reimbursement" or "DMR" means a request by a Member for reimbursement of a prescription covered under the Plan where the Member paid out- of-pocket at the retail pharmacy. |
| E1.26 | "Discount Card Claim" means a Claim in connection with a plan or program that provides access to discounts on prescription products and supplies to consumers through prescription savings programs i.e., not insurance, pursuant to which the consumer pays 100% of the applicable price at the point of sale at the pharmacy. Discount Card Claims do not include Claims for which a Member is responsible to pay 100% of the gross cost according to Member Cost Share during a Deductible or based on the applicable formulary tier for the product under the Member's insured benefit plan. |
| E1.27 | "Dispense as Written" or "DAW" means the NCPDP standard code submitted on a Claim to indicate a prescribers', Members', or other entities' (e.g. state law, Contractor formulary) instruction regarding a Generic or Brand Drug substitution. |
| E1.28 | "Dispensing Fee" means the dispensing Pharmacy's service fee incurred at point of sale, excluding the Ingredient Cost, taxes, or any Contractor margin, for the filling of a Covered Drug for a Member. |
| E1.29 | "Drug Classification" means the agreed upon methodology described herein to classify Brand Drugs and Generic Drugs for the purposes of all financial guarantees and reconciliation. |
| E1.30 | "Formulary" means the list of clinically appropriate medications and supplies covered by the Client organized into different tiers or levels indicating potential Member Cost Share for each Covered Product. |
| E1.31 | "Generic Code Number” or “GCN" means the standard, unique identifier assigned by First DataBank based on the strength, formulation, and route of administration of a drug entity. |
| E1.32 | "Generic Drug" means a drug or product with the Medi-Span multi-source code field of "Y" on the date of fill or "House Generic," as defined herein. This definition shall be applied for financial evaluation and reconciliation purposes using objective, claims-identifiable criteria derived from standard, third-party reference data, as specified herein. Any proposed modification must be expressed using the same framework. Failure to comply with this requirement may impact the evaluation of Contractor's financial proposal. |
| E1.33 | "Government Claim" means a Claim submitted to Contractor by, for or on behalf of a government agency for payment of prescription drug benefits under a benefit plan for a prescription drug product, supply or other product dispensed to a Member for which Client is deemed to be the primary payer by operation of applicable law. |
| E1.34 | "GPI" or "GPI-14" means the Generic Product Identifier reported by Medi-Span. It is a 14-character hierarchical classification that identifies drugs from their primary therapeutic use down to the unique interchangeable product regardless of manufacturer or package size. |
| E1.35 | “Home Infusion Claim” means a paid Claim submitted with the Patient Residence Code (384-4X), as indicated in the NCPDP D.0 format, coded as “1” or “4”, a Pharmacy Service Type (147-U7), as indicated in the NCPDP D.0 format, coded as “3”, and a Place of Service Code (307-C7), as indicated in NCPDP D.0 format, coded as “1”. |
| E1.36 | "House Generic" means a drug or product with the Multisource code field in Medi-Span of "O" when there is a DAW code of 3, 4, 5, or 6 on the date of fill. This definition shall be applied for financial evaluation and reconciliation purposes using objective, claims-identifiable criteria derived from standard, third-party reference data, as specified herein. Any proposed modification must be expressed using the same framework. Failure to comply with this requirement may impact the evaluation of Contractor's financial proposal. |
| E1.37 | “Indian Health Service, Tribal, and Urban” or “I / T / U” Claim means a paid Claim dispensed by a Participating Pharmacy whose NCPDP Provider Type Code is coded as “8” and with an NCPDP D.0 Place of Service Code (307-C7) coded as “5,” “6,” “7,” or “8.” |
| E1.38 | "Ingredient Cost" means the total cost for a Covered Product on a paid Claim, excluding any Administrative Fees, Dispensing Fees, government-imposed service fees, and taxes, in accordance with the terms of the Plan. |
| E1.39 | "Limited Distribution Drug" means a Specialty Drug that is available for distribution through a limited number of pharmacy providers, as determined by the pharmaceutical manufacturer, regardless of Contractor's access. |
| E1.40 | “Long Term Care” or “LTC” means a paid Claim submitted with the Patient Residence Code (384-4X), as indicated in the NCPDP D.0 format, coded as “3” or “9” and a Pharmacy Service Type, as indicated in the NCPDP D.0 format, coded as “4” or “5.” LTC Claims cannot be subject to a minimum Days Supply requirement to be included in guarantees. |
| E1.41 | "Mail" or “Mail Order” Claim means any Claim processed at a designated mail order pharmacy at any days supply. |
| E1.42 | "Manufacturer Administrative Fees" means those administrative fees received by Contractor or its affiliate(s) from pharmaceutical manufacturers or intermediaries pursuant to a contract between Contractor or its affiliate(s) and a drug manufacturer to manage placement of Covered Products on Contractor's Formulary and administering, invoicing, allocating and collecting Rebates that are attributable to Covered Products dispensed to Members. |
| E1.43 | "Manufacturer Derived Revenue" means revenue, compensation, credits or financial remuneration of any kind received or recovered by Contractor or its affiliate(s) or subcontractor from a pharmaceutical manufacturer directly or indirectly resulting from Client's utilization attributable to the purchase or utilization of covered drugs including, but not limited to, base rebates, access rebates, formulary placement rebates, market share incentives; promotional allowances; commissions; educational grants; drug pull-through programs; implementation allowances; rebate submission fees; and administrative or management fees. This also includes revenue and or credits received by Contractor or its affiliate(s) or subcontractor from pharmaceutical manufacturers or intermediaries that are attributable to Client utilization of Covered Products. |
| E1.44 | "Member" or "Plan Participant" means each individual identified by Client to be eligible for prescription drug benefits under a benefit plan, including subscribers and dependents, as set forth in Client's eligibility file or otherwise communicated by Client in a mutually acceptable format. |
| E1.45 | “Military or Veteran's Administration” or “VA” means a Claim processed any place under VA jurisdiction where drugs are dispensed, and pharmaceutical care is provided to enrolled veterans. |
| E1.46 | "NDC-11'' or "NDC" means the unique eleven-digit National Drug Code, as reported by Medi-Span. |
| E1.47 | "NADAC" means the National Average Drug Acquisition Cost per unit as published by CMS using the NDC dispensed based on effective date in the CMS file for the service date of the claims. NADAC is a pricing methodology for retail pharmacies as a basis for payment, it excludes Specialty and Mail Order pharmacies and does not reflect Rebates, copay assistance, or any additional pricing components. NADAC-plus pricing is a drug pricing based on the drug-specific NADAC unit cost plus some fixed dollar spread or Dispensing Fee. |
| E1.48 | "New-To-Market" means a Specialty Drug or Brand Drug that is newly introduced for sale by pharmaceutical manufacturers. A Specialty Drug or Brand Drug may only be considered New-to-Market for up to six (6) months following market release. |
| E1.49 | "Non-Participating Pharmacy" or "Out-of-Network Pharmacy" means a pharmacy that does not currently hold a network agreement with Contractor to dispense Covered Products to members. |
| E1.50 | "Over-The-Counter" or “OTC” means any product with a Medi-Span© Rx/OTC (Rx) Indicator of "O" or “P” on the Dispense Date. |
| E1.51 | "Participating Pharmacy" means a pharmacy that currently holds a network agreement with Contractor to dispense Covered Products to members under the Client's Plan Benefit. |
| E1.52 | "Pass-Through” means Contractor shall invoice the Client the same amounts reimbursed by Contractor to retail Participating Pharmacies for any Covered Item dispensed from such retail Participating Pharmacy. This pricing model will bill the Client the exact Ingredient Cost, Dispensing Fee and taxes paid less member copay to the Participating Pharmacy. Contractor receives no other revenue and derives no other value from any Paid Claim adjudicated at the Participating Pharmacy, either directly or indirectly, in the aggregate or otherwise, except for the fee(s) charged by Contractor to a Participating Pharmacy for administrative services related to dispensing Covered Products to Members. |
| E1.53 | “Plan” means the benefit plans sponsored by the Client including the prescription drug benefit, to be administered by Contractor. |
| E1.54 | "Rebate(s)" means any discount, price concession, and/or other direct or indirect remuneration from pharmaceutical companies, rebate aggregators, and/or other third-party contractors paid to PBM on behalf of Sponsor's prescription utilization, including but not limited to Brands, Generics, Specialty Drugs and Biosimilars. PBM agrees that all Rebates will be fully passed-through to the Sponsor and auditable at the claim level, and which will include but not be limited to the following: (a) formulary and/or access rebates; (b) bonuses and enhancements, including but not limited to market-share, growth, portfolio, product bundles; (c) pharmaceutical manufacturer rebate program administration fees inclusive of data fees, unless parties mutually agree with amounts retained by PBM in an advanced writing; (d) Revenue received under price protections, price predictability, inflation protection, price inflation protection, or other similar arrangements with pharmaceutical manufacturers which require manufacturers to refund drug cost increases, including but not limited to AWP, WAC, and/or AMP, exceeding a specified ceiling or maximum allowable amount in the agreement; (e) rebates, bonuses, administrative fees, or any other incentives tied to the Sponsor's implementation of specific programs or criteria. Please note agreement to this question is highly encouraged. If Contractor disagrees and/or modifies the definition, it may impact the evaluation of its financial proposal. |
| E1.55 | "Retail 30" means a non-specialty Claim processed at a Participating Pharmacy with a days supply equal to or less than 83. |
| E1.56 | "Retail 90" or "Extended Days Supply" means a non-specialty Claim processed at a participating pharmacy with a days supply greater than 83. |
| E1.57 | "Retail Specialty" means a Specialty Claim processed at a Participating Pharmacy, i.e., not designated as a specialty pharmacy, at any days supply. |
| E1.58 | "Specialty Drug" means certain pharmaceuticals, biotech or biological drugs used in the management of chronic, complex, rare or genetic disease, including but not limited to, injectable, infused, inhaled, or oral medications, or products that otherwise require special handling. Specialty Drugs shall be determined at the GPI-14 level or GCN-First Data Bank, meaning if a single NDC within the GPI-14 is considered Specialty, all NDCs within the GPI-14 shall be considered Specialty (whether or not all NDCs are listed on the published specialty list). Please note agreement to this question is highly encouraged. If Contractor disagrees and/or modifies the definition, it may impact the evaluation of its financial proposal. |
| E1.59 | "Tax" means any applicable federal, state or local government levied amount currently in existence or hereafter enacted, calculated either on gross revenues or by transaction, whether such tax is designated a sales tax, gross receipts tax, retail occupation tax, value added tax, health care provider tax, transaction privilege tax, assessment, pharmacy user fee, wholesale distributor tax, or charge otherwise titled or styled, and whether or not the bearer of the tax is the retailer or consumer. |
| E1.60 | "Usual and Customary" or "U&C" means the actual retail price charged by a Participating Pharmacy for a specified drug, if purchased in a cash transaction on the date the drug is dispensed, as reported to the Contractor by the Participating Pharmacy. |
| E1.61 | "Vaccine" means a substance used to stimulate immunity to a particular infectious disease or pathogen, as identified by GPI-2, i.e., 17- and 18-. |
| E1.62 | "Zero Balance Claims" means any Claim for which the Member is responsible for the full amount of the gross cost and the Client is responsible for no cost. |
| E1.63 | "Wholesale Acquisition Cost" or "WAC" is the manufacturer’s list price for a drug to wholesalers or direct purchasers, before any discounts, rebates, or other price concessions are applied. WAC will represent the date-sensitive WAC published by Medi-Span for the eleven (11) digit NDC of the product on the date of service. WAC will be updated at least weekly using the most up-to-date files from Medi-Span or such other nationally available reporting service of pharmaceutical prices. The same WAC used in Claim adjudication will apply for all guarantee calculations and reconciliation for each Claim, regardless of dispensing channel. For purpose of clarity, the identical WAC will be used by Contractor for paying Client as used for invoicing pharmaceutical manufacturers. |
| E1.64 | “Secondary Claim" means a claim for a Plan Participant who has secondary coverage under NVHA’s plan and who has primary coverage under a separate plan. A secondary claim has first been submitted to the primary plan for reimbursement and NVHA has responsibility to pay only the unpaid balance from the primary plan. |
| E1.65 | “Gross Drug Cost” shall mean the total amount payable by Client for Covered Drugs, prior to collection of any Plan Member Cost Share for all Covered Drugs dispensed by Contractor’s Specialty mail pharmacy or Contractor’s mail order pharmacy, as applicable, for the applicable Contract Year. Accordingly, Gross Drug Cost as defined herein may differ from the adjudicated Gross Drug Cost reflected on individual claims or operational reporting. For the avoidance of doubt, Gross Drug Cost shall exclude Administrative Fees and other fees. For purposes of any Actual Acquisition Cost (AAC) guarantee, reconciliation, audit, or financial settlement under this Agreement, Gross Drug Cost shall represent the aggregate ingredient cost basis against which applicable AAC benchmarks, lower-of pricing methodologies, and contractual performance guarantees are measured. Gross Drug Cost shall be determined using the same drug cost basis used to calculate Actual Acquisition Cost under this Agreement. |
| E1.66 | "Actual Acquisition Cost" or "AAC" means, the Dead Net Cost of a drug product, based on a 11-digit National Drug Code (NDC), on the date and time the drug product is dispensed, using Last-in First-Out (LIFO) accounting methodology. The Dead Net Cost is the net cost of a drug product to the Vendor inclusive of all wholesaler, distributor, manufacturer, group purchasing organization / Contractor, and any other third party purchasing concessions, discount, volume discounts, off-invoice discounts, short dated fees, distribution fees, data fees, dispensing and administrative fees associated with the 340B program, purchase allowances, trade credits, prompt pay / cash discount, incentive payments (e.g., volume, market share), and all other pricing adjustments. |
File details come from the government source that posted it. Updated .