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Title 8: Medicaid Page 16 Iowa Department of Health and Human Services Employees’ Manual Chapter A: Administration Benefits Revised January 13, 2023 Recovery
“The amount of the claims for prescriptions that were not received was used to meet spenddown. Since the person did not receive the drugs, the person was not obligated to pay medical expenses that were used to meet spenddown. As a result, the person was made Medicaid eligible and received services for which the person was not eligible.” If the appellant disputes the amount of the overpayment, ask if the appellant has any documentation to show that the appellant is obligated to pay or has paid these pharmacy claims.
Mr. Z, who is potentially eligible for Medically Needy for May and June, has a spenddown of $150. Mr. Z takes his prescription to Pharmacy M on May 15. Pharmacy M submits a claim through the Point of Sale (POS) system and finds out that Mr. M. has not met his spenddown. Pharmacy M does not give Mr. Z his prescription, since he cannot pay the $175 cost. The POS system does not know that Mr. Z did not receive the prescription. It sends the claim to MMIS. MMIS submits the claim to the Medically Needy subsystem and Mr. Z meets his spenddown. Pharmacy M faxes the Medically Needy Expense Deletion Request to the Medically Needy Unit at IME. The Medically Needy Unit determines that Mr. Z has met spenddown using the prescription that he did not receive. The Medically Needy Unit sends the income maintenance worker a letter stating that Mr. Z did not incur the expense for the prescription. The worker checks the Medically Needy subsystem and determines that the $175 submitted by Pharmacy M on May 15 was used to meet spenddown. On the first of January, six months after the end of the certification period, the worker obtains information from the Overpayment Recovery Detail system to determine the amount of claims that Medicaid paid for Mr. Z for the months of May and June. Medicaid paid $2,595.55 in claims for Mr. Z. Since Mr. Z did not incur $150 in medical expenses and therefore, did not meet his spenddown, an overpayment for $150 is completed.