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Rules for Dispensing Drugs for Medicaid in Louisiana

All health care providers operating in the state of Louisiana must abide by the federal rules for dispensing drugs and other types of medication under the Medicaid program. These rules are intended to lower waste, confusion and fraud that may occur during Medicaid transactions. The rules are legally binding and pharmacists or patients who break them can face punishment.

  1. Louisiana Medicaid Pharmacy Benefits Management System

    • Louisiana Medicaid Pharmacy Benefits Management System (LMPBMS) is the state-owned and operated system for management of prescription drug benefits. The system is the reference for all drug dispensation issues in Louisiana. The system covers all Food and Drug Administration-approved drugs that are covered by Medicaid. It also determines the reimbursement procedure for drug ingredient cost and dispensing fees.

    Physicians Authorized to Dispense Drugs

    • Physicians who dispense drugs under the LMPBMS must meet three criteria: they must be approved by the Louisiana Board of Medical Examiners as a dispensing physician, they must work no less than five miles away from the location where the drugs are being dispensed, and they must enroll in the Medicaid program as a pharmacy provider. Reimbursements for drugs dispensed are paid directly to the pharmacy and not the physician, unless the treating physician dispenses her own medication and bills under her own name.

    Procedure for Dispensation

    • Licensed prescribers can only dispense drugs to those who are Medicaid-eligible on the date of service. Louisiana Medicaid only pays for those drugs that the providers has signed and submitted rebate forms for. Drugs must be medically necessary to the patient in order for the provider to be reimbursed. Louisiana has a federally-mandated program called the Drug Utilization Review that monitors prescriptions to ensure medical necessity is being upheld. Prescriptions must be filled with six months of the issue date. No more than five refills can be reimbursed.

    Provider Rights

    • Providers can refuse services to any patient for whom they have a valid, legal reason to refuse. Providers receive ten cents for each out-patient prescription filled, including those made outside of Louisiana for drugs delivered into the state. It is against the law for anyone to solicit providers to accept bribes, kickbacks or rebates for any drug dispensed under the Medicaid program. It is also illegal for providers to accept or offer to accept such bribes.

    Provider Duties

    • Providers must maintain daily activity reports and dispensing (or overhead) costs surveys to be at any time for review. Drug providers must keep also prescription records of all Medicaid recipients (as well as recipients for Medicare and other programs) for at least five years from the date of service. The pharmacy records should clearly show all new and refill prescriptions for every Medicaid patient who receives drugs through that pharmacy.

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