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Paying For Prescription Formula: “Thinking Outside the Can” Part 1
Dear Red Tape,
My son is 8 and he has life-threatening food allergies and a clinical diagnosis of Mito. He needs to drink Neocate Jr. for nutrition. Our private health insurance doesn’t cover it, and we make about $50 over the monthly income limit for Medicaid. Some weeks I have to choose between buying my son’s formula and paying a utility bill, or buying healthy food for the rest of the family. Is there any way that we can get a discount on his formula? Help!
Jen in Texas
Your family is certainly not alone in the fight to make drastic financial decisions in order to provide medically necessary nutrition to your child. Nutritional supplements are expensive, and elemental formulas can easily cost more than a thousand dollars per month. For many children who require supplemental nutrition or specialized elemental formulas, vouchers can be obtained through WIC and the Federal School Lunch Program, and new state legislation requiring private insurances to cover medically necessary formulas and supplements exists in thirteen states and is being lobbied for in two more.
Private insurances are often able to choose whether or not to coverage a specific medical treatment, procedure, diagnostic test, or medication for cost-containment purposes, and prescription formulas are often left to the family to pay out-of-pocket. Still, it doesn’t hurt to appeal your insurance’s decision.
Reimbursement Legislation Efforts are underway to create laws that mandate private insurance companies to cover the costs of medically necessary formulas. Children’s Milk Allergy and Gastrointestinal Coalition (MAGIC) is committed to promoting healthcare coverage and reimbursement of amino acid-based elemental formulas for children who are unable to consume a natural, life-sustaining diet due to various allergies or diseases. Children’s MAGIC is composed of parents, organizations, institutions, and like minded individuals. For more information, visit MAGIC. As of September 1, 2009, Texas laws require private insurance to cover medically necessary formulas, congratulations! The other states that have this requirement are Arizona, Connecticut, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Hampshire, New Jersey, New York, Oregon, and Rhode Island. (Click on each state for more information.)
Letters of Medical Necessity The major formula companies offer templates for that can be downloaded and submitted by your child’s physician. For general insurance reimbursement tips, click here.
Here is the sample letter for your son’s formula, Neocate Jr.
Nutricia North America makes Neocate and several other highly specialized formulas for a wide range of metabolic conditions. Two more products that you may recognize are EO28 and duocal. To view “Hints and Tips for Successful Reimbursement of Special Formulas Taken Orally or Via G-Tube,” click here.
Ross/Abbott produces a long line of nutrition supplements and special medical formulas. Some of their most popular products are EleCare, Vital Jr., Juven, Pediasure, Ensure, Glucerna, and Polycose. Templates of medical necessity can be found here.
WIC is a federal program that provides nutrition assistance to pregnant women, infants, and children to age 5. Families must meet income guidelines. WIC provides vouchers for free medically necessary formula. For information about eligibility and covered formulas and medical food, click here: WIC
The Federal School Lunch Program is required to provide accommodations for students with developmental and special health care needs, including nutrition needs. Your child may qualify for federally subsidized specialized formula given during school hours. The USDA Guidance Manual “Accommodating Children with Special Dietary Needs in the School Nutrition Programs” explains the school food service role in providing meals to students with special dietary needs. For a complete copy of this USDA manual, click here: USDA
Paying For Prescription Formula: “Thinking Outside the Can” Part 2
How can people who depend on prescription formula for nutrition find assistance paying for it? The first article of this series provided financial resources for medical nutrition for children with special needs. Unfortunately, there are fewer programs available for adults in need of medical nutrition supplements. The purpose of this article is to discuss the barriers encountered by adults in need of nutritional supplements, the role of federal and state health care programs in Medical Food/Enteral Nutrition Therapy/Medically Necessary Supplemental Nutrition, and potential sources of assistance from public and private sources.
What Is a “Medical Food?”
According to the United States Food and Drug Administration, a Medical Food is is “a food which is formulated to be consumed or administered enterally (via the digestive system through the mouth or a feeding tube) under the supervision of a physician and which is intended for the specific dietary management of a disease or condition for which distinctive nutritional requirements, based on recognized scientific principles, are established by medical evaluation.”
As mentioned in Part 1, at least 37 states have passed laws mandating health insurance coverage for Medical Food that has been ordered by a physician for the treatment of inborn errors of metabolism. Unfortunately, only a handful of these states extend benefits to adults with metabolic illnesses. Some adults may qualify for special programs based on their specific illness, career, history of military service, or state of residence. Two websites that offer benefit eligibility searches are the Federal Government Comprehensive Benefit Search and State Assistance Program Database.
Medicare is a federally funded health insurance program for:
Medicare consists of:
Medicare Part A, also known as Hospital Insurance. Helps cover inpatient care hospitals, hospice and skilled nursing facilities and some home health care. Medicare Part A covers the administration of oral nutrition when ordered by a physician within the setting of a hospital, rehab, skilled nursing facility, or as part of comfort care under Hospice Benefits. For patients who are receiving care anywhere for the length of stay Inpatient, acute care hospital Medicare Part A benefits will cover specialized formula, administered orally or via feeding tube, for the length of stay while inpatient in an acute care hospital. In all other situations mentioned above, Medicare Part A will cover services for a maximum of 100 consecutive days. After that, the patient will need to pay out-of-pocket for specialized formula, or arrange for coverage through Medicare Part B, Medicaid, or other sources.
Medicare Part B, also known as Medical Insurance. Medicare Part B helps cover outpatient care, such as office and clinic visits and procedures or tests performed there, physical and occupational therapy, and durable medical equipment, such as walkers and manual wheelchairs. Medicare Part B provides coverage for enteral nutrition when administered through a feeding tube in the homecare setting, or after the first 100 day Part A benefit in a skilled nursing facility. There are medical necessity criteria that must be met and providers like durable medical equipment companies are familiar with the billing and documentation process. Medicare does not provide coverage for nutritional products when orally consumed in the outpatient or homecare setting. In most cases, Medicare Part B pays a percentage of health care costs, usually 80%, and the patient is responsible for paying the remainder out of pocket or through supplemental health care programs.
Medicare Part C, also known as Medicare Advantage or Medicare Managed Care Plans. These supplemental insurance plans are offered through commercial insurance companies. Medicare Managed Care plans frequently offer “wrap-around” services to provide additional coverage for benefits provided by Medicare Part B. People with complex health care needs may find that Medicare A and B either do not provide all of the medical support they require, or they need to decline medically necessary services because they are unable to afford out-of-pocket expenses. Medicare Managed Care Special Needs Plans may provide extended benefits, including oral Medically Necessary Supplemental Nutrition. Medicare Managed Care Plan availability, specific benefits, patient cost, eligibility, and enrollment procedures are highly variable. For more information, please consult Medicare.gov, the official US government site for Medicare.
Medicare Part D, also known as Prescription Drug Coverage. Medicare Prescription Drug Plans provide coverage for both brand-name and generic prescription drugs. Patients who receive Medicare A and B are offered a list of available plans, and can choose the plan that best suits their medication needs. Most Managed Care Plans include prescription medication benefits, so patients do not usually need to pay for a separate prescription drug plan. Medicare Part D does not cover enteral or parenteral nutrition.
Medicare Supplemental Coverage: Medigap (Medicare Supplement Insurance)https://www.medicare.gov/Publications/Pubs/pdf/02110.pdf A Medigap policy is private health insurance that is designed to help pay health care costs that Medicare doesn’t cover, such as coinsurance, co-payments, deductibles, and out-of-pocket costs for non-covered medical expenses.
Medicaid is a health care program that is federally subsidized but managed by each individual state. The financial guidelines vary widely, for basic eligibility information check here: http://www.cms.gov/MedicaidEligibility/02_AreYouEligible_.asp Medicaid is the number one source of payment for elemental formulas for children and adults with health care needs. Many families are caught in the precarious situation of earning too much money to qualify for Medicaid or SSI but not enough to meet their family’s needs. Medicaid generally covers specialized formulas and dietary supplements when ordered by a physician by submitting a letter of medical necessity.
Private Health Insurance
Private insurances are often able to choose whether or not to coverage a specific medical treatment, procedure, diagnostic test, or medication for cost-containment purposes, and prescription formulas are often left to the family to pay out-of-pocket. Still, it doesn’t hurt to appeal your insurance’s decision. The major formula companies offer templates for letters of medical necessity that can be downloaded and submitted by your physician. For general insurance reimbursement tips, click here.
Some non-profit organizations offer lists of donated supplies and medical foods, which are available on a first come, first served basis:
Programs Established by Pharmaceutical Companies
Abbott Patient Assistance Program: http://www.abbottpatientassistancefoundation.org/medical_nutritionals.asp
The following description is from gettingfoodstamps.org:
SNAP, the Supplemental Nutrition Assistance Program, is the program formerly known as food stamps. It is a federal nutrition program that helps you stretch your food budget and buy healthy food. SNAP benefits can be used to purchase food at grocery stores, convenience stores, and some farmers’ markets and co-op food programs. SNAP benefits are given to you each month on a plastic card called an EBT (electronic benefits transfer) card, which works like a debit card. Paper coupons are no longer used. SNAP is a nutrition program. It is not a welfare cash assistance program (which is called TAFDC). You do not have to be receiving TAFDC to get SNAP -- these are separate programs. SNAP is a federal entitlement program. This means anyone who is eligible will receive benefits. You will not be taking away benefits from someone else if you apply.
Families with an elderly or disabled household member are eligible for more services than other families. Some of these benefits include:
Can SNAP benefits be used to purchase Medical Foods and Medically Necessary Nutrition Supplements?
Yes, in many cases. According to the USDA, SNAP benefits can be used toward the purchase of products that fit the following description:
When considering the eligibility of vitamins and supplements, power bars, energy drinks and other branded products, the primary determinant is the type of product label chosen by the manufacturer to conform to Food and Drug Administration (FDA) guidelines:
The Food and Nutrition Service does not have authority to determine whether branded products have been appropriately labeled as supplements and cannot answer inquiries relative to why particular branded products carry a supplement facts label. Such questions/concerns must be directed to the product manufacturer. Product manufacturers label their products based on Food and Drug Administration (FDA) labeling guidelines and are in the best position to provide labeling rationale.
Please follow the guidance above to determine whether a specific branded product is eligible.
Many nutrition supplements can be obtained without a prescription. If the patient is unable to receive nutrition supplements from federal, state, or private health insurance benefits, the USDA’s SNAP program may be used to purchase certain supplements from a grocery store. In order for the patient to claim these supplements as a medical expense, they must obtain a Letter of Medical Necessity from a physician. See https://lmnbuilder.com for assistance.
For more information, please review the USDA’s Nutrition Supplement Eligibility Determination Board at http://www.fns.usda.gov/snap/eligibility
Community Food Pantries, COA, Meal Distribution
Most communities offer private food pantries, food banks, Meals on Wheels programs, and other services. The USDA website lists the major food banks, food pantries, and nutrition programs operating in each state: http://www.nal.usda.gov/fnic/pubs/bibs/gen/homeless.pdf
The National 2-1-1 Information and Referral Search can help you locate any other nutrition programs offered in your community. http://www.211.org
Income Tax Programs
Two kinds of tax-exempt accounts help people save money for health expenses, and may help you cover out-of-pocket supplemental nutrition costs. The flexible spending account is a benefit offered by some employers. It allows you to set aside pretax dollars each pay period for health-related expenses. The health savings account is for people who participate in high-deductible health plans (also called catastrophic health plans.) The plan beneficiary, not an employer, establishes this kind of account. For more information, see ( 1.11MB).
Medically necessary supplemental nutrition expenses are tax deductible. For more information, see http://www.financialplanhorizons.com/worksheets/MedicalWorksheet.pdf ( 1.28MB). Also useful to simplify tax filing is the Medical Expense Worksheet Summary which provides a single location to summarize expenses in all areas, for all family members.
COPYRIGHT 2012 by Heidi Martin-Coleman of colemanconnect.com and MitoAction.org
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