October 2012

Providers will be notified of future issues of the Division of Medical Services' Newsletter via listserv notification. If you wish to be notified each time a new issue of the newsletter becomes available, please sign up for the Medical Services Newsletter Listserv here.

Medicare Part D Coverage Expansion
One component of the Medicare Improvements for Patients & Providers Act establishes coverage of benzodiazepines and barbiturates by Medicare Part D plans. These drugs had previously been excluded from Part D coverage and were, therefore, billed to Medicaid for those beneficiaries who are dually eligible for Medicare and Medicaid. Effective January 1, 2013 claims submitted to Medicaid for these drugs for dually eligible recipients will deny. The claims must be submitted to the recipient's Part D plan.

Antipsychotic Prior Authorization

During the June 2012 Medicaid Pharmacy & Therapeutics (P&T) meeting, the committee recommended a prior authorization for atypical antipsychotic agents. For more information please visit the P&T website:

Is your Provider Record Current?

Letters were recently sent to the address indicated in SDMEDX for each provider with a billing NPI. The letter requested that providers review and update their Provider record. Did you get your letter? If not, you may not have a valid mailing address on your record in SD MEDX, the system of record for provider data.

If you haven't already done so, please make sure your organization reviews all of the provider records regularly to account for changes in staff, licensure, addresses, contact information and other details. Please also double check that the existing information is correct. The listed contact on your record (often an enrollment or credentialing team member) should have the login information and can request assistance in getting login information reset.

If you need help determining who your point of contact is, please contact Provider Enrollment at 866-718-0084 or and have your NPI available .

Co-Payment Changes

A provision of the Affordable Care Act (ACA) includes an exemption from out of pocket costs for all American Indians and Alaska Natives who have ever received a service from the Indian Health Service, tribal health programs, or under contract health services referral. This will affect South Dakota Medicaid recipients that are subject to a copayment for medical services. This exemption does not apply to Long Term Care services.

Because this exemption may not apply to all American Indians/Alaskan Natives, we are implementing changes in our claims processing system and eligibility system to make it easier for providers and recipients to determine appropriate co-payment amounts.

Pharmacy Services

South Dakota Medicaid has updated the Pharmacy Point of Sale and the Eligibility system to reflect these changes. When processing pharmacy claims, providers will see the exemption reflected in the copayment due from the recipient

Primary Care Services

If you are a primary care provider serving one of the affected recipients, you will receive information reflecting which recipients are exempt from copayment. Additionally, the recipients will also receive this information.

Other Services

If you have questions about co-payment amounts for other services, please feel free to give our telephone service unit a call at 1-800-452-7691 (in-state providers) or 605-945-5006 (out-of state providers). You can obtain recipient specific information about applicable co-payments.

In the coming months, South Dakota Medicaid will be updating its eligibility inquiry system to reflect the amount of copayment due from recipients. We will continue to keep you informed as those additional enhancements are implemented.

South Dakota Prescription Drug Monitoring Program Update
The South Dakota Prescription Drug Monitoring Program (SD PDMP), operated by the South Dakota Board of Pharmacy, became operational in April of 2012.

Prescription dispensing data is being submitted by SD licensed pharmacies and includes over 1.1 million prescription records from July 1, 2011 - August 31, 2012. The database is confidential and access requires the completion of an application process. Approval is based upon specific validation criteria. Over 1,000 practitioners (pharmacists, physicians, physician assistants, nurse practitioners and dentists) have been approved for online access. To date, over 9,300 patient profile queries have been requested.

The program was established with an overall goal to improve patient care as well as to reduce diversion of controlled substances. Once access is granted, prescribers may review patient profiles from the PDMP database to supplement an evaluation of a patient, to confirm a patient's drug history or to document compliance with a therapeutic regimen. Reports may also be generated to aide prescribers, dispensers, and law enforcement in identifying and preventing illicit use of controlled drugs.

For more details, please access the SD Board of Pharmacy website at

Employee Spotlight- Ann Schwartz
As one of the two Assistant Division Directors in the Division of Medical Services, Ann is responsible for the programs and services aspect of Medicaid. This includes working with her team to develop State Medicaid Plan amendments, operation of the Managed Care Program, Premium Assistance Payments to Medicaid recipients, the Pharmacy Point of Sale system, and establish prior authorization requirements. Ann and her team are directly involved with the follow-up activities underway to implement the recommendations of the Medicaid Solutions Work Group. These include development of Health Homes, the Money Follows the Person Demonstration Program and a Durable Medical Equipment recycling program.

Before joining Medical Services, Ann was the Home and Community Based Services Program Manager in the Division of Adult Services and Aging. In that role, Ann managed the HCBS 1915(c) Waiver operated by the Department to serve individuals who are elderly and/or have a qualifying disability.

Prior to joining the Department two years ago, Ann had just relocated to Pierre from Boston, MA. A Pierre native, Ann had moved to Boston to attend the Boston College Graduate School of Social Work. After obtaining her Masters in Social Work, Ann worked in and around Boston for 9 years. The majority of that time was spent coordinating Healthy Families, a home visiting program for young people, age 21 and under, who are pregnant or parenting for the first time.

After having her second child, Ann convinced her husband to move to Pierre and enjoy the slower pace of life while raising their son and daughter. While the "slow" part is not applicable at work, Ann does enjoy her 5 minute commute, having family support, and giving her children the opportunity to live in this fantastic community and State.

New Employees

Sarah Aker, Policy Analyst: Sarah grew up in Piedmont, South Dakota and graduated from Sturgis High School. She recently received her BS in Chemistry and Political Science in May from the University of South Dakota, where she was a member of the Honors Program. As a Policy Analyst, Sarah is responsible for reviewing and developing policies and procedures, updating and maintaining the fee schedules and policy manuals, conducting research and surveys, and data collection and analysis to aid the Division of Medical Services.

Please also welcome the new employees in the Telephone Service Unit. They are Heather Big Eagle, Valerie Lunde, Wendy Culver and Evey Flax. We are excited they have joined our team.

Finally, when you call the Division you may be greeted by one of our new Secretaries Sierra Andersen and Barbara Spelbring.

Important Contact Numbers

Please clip and save for future reference.

Telephone Service Unit for Claim Inquires:

  • In State Providers:
  • Out of State Providers:

Provider Response (Enrollment and Update Information):

Medical Assistance for Recipients:

Dental Claim and Eligibility Inquiries:

Managed Care Updates:

Pharmacy Prior Authorization:

Medical & Psychiatric Prior Authorization:

Recipient Premium Assistance:

Welfare Fraud Hotline:

Medicare: 1-800-633-4227

Division of Medical Services Fax:

Provider Enrollment Fax:

Health Home Update

The Health Home Workgroup and three subgroups met several times over the summer and made significant progress towards the implementation of a Health Home pilot project. The pilot project will create two types of health homes. One will be focused on people with two chronic conditions or one chronic condition and at risk for a second. The second health home will target individuals with a serious mental illness.

Providers who enroll to act as a health home will be responsible for providing six core services not currently reimbursed by Medicaid. These six core services are comprehensive care management, care coordination, health promotion, comprehensive transitional care, patient and family support, and referrals to community and social support services. After reviewing comprehensive data, the Workgroup recommended that the six core services be reimbursed through a four tier per member per month model.

During the August 27th, 2012 Health Home Workgroup meeting, a Pilot Subgroup was formed. That group was tasked with defining the parameters of the Pilot sites, determining how coverage gaps could be addressed, discussing attribution of eligible Medicaid recipients to Health Homes, and reviewing additional provider enrollment standards. The Pilot Subgroup will report their recommendations to the Health Home Workgroup at the end of October.

South Dakota Medicaid Electronic Health Record Incentive Payment Program Update

South Dakota Medicaid has distributed over $6.8 million in electronic health record incentive payments to 51 eligible professionals and 9 eligible hospitals.

Stage 1 Meaningful Use attestations will soon be accepted. User guides and other important information will be announced in the near future.

The Office of the National Coordinator for Health Information Technology (ONC) and the Centers for Medicare and Medicaid Services (CMS) released the Final Rule for Stage 2 Meaningful Use in August. To review the Stage 2 Rules and other information, please click here.

South Dakota will move forward with system development to accept attestations for Meaningful Use Stage 2 by January 2013.

Enhanced Primary Care Provider Payments

For 2013 and 2014, payments for certain primary care services provided to Medicaid recipients will be increased to match Medicare reimbursement levels. The Affordable Care Act mandates that State Medicaid agencies pay qualifying providers at the greater of 2009 or 2013 Medicare rates for evaluation and management (E&M) services and services related to immunization administration for vaccines and toxoids. The enhanced reimbursement between the Medicaid rate and the enhanced Medicare rate will be reimbursed with 100 percent federal funding and this funding is available for a limited two year period.

The Centers for Medicare and Medicaid Services (CMS) have issued draft rules that indicate enhanced rates will apply to fee-for-service rates for eligible providers including physicians specializing in family medicine, general internal medicine, and pediatric medicine. Related sub-specialists are eligible for the rate increase when providing eligible primary care services. The enhanced rates also apply to mid-level practitioners, such as nurse practitioners and physician assistants when providing the service under an eligible physician's supervision.

States are awaiting publication of the final rule and CMS guidance. The draft rule indicates States must verify that providers fall into one of the designated specializations through verification of board certification in an eligible specialty. Providers must also be enrolled in the Vaccines for Children Program. The enhanced rates do not apply to services covered under Federally Qualified Health Center (FQHC) and Rural Health Center payments.

CMS guidance indicates enhanced rates are eligible for E&M procedure codes 99201 through 99499 and vaccine administration codes 90460, 90461, 90471, 90472, 90473, and 90474. The Department of Health and Human Services (DHHS) designated these codes to increase incentives for primary care physicians to provide checkups, preventative screenings and vaccines to Medicaid recipients.

The Division of Medical Services is currently undergoing programming changes to the Medicaid Management Information System to seamlessly implement these enhanced payments to primary care providers effective January 1, 2013. Providers eligible for the temporary enhanced reimbursement will receive additional information once the final federal guidance has been published.

Money Follows the Person

On August 8th, the Department of Social Services submitted an application to the Centers for Medicare and Medicaid Services to join forty-three states and the District of Columbia in implementing the Money Follows the Person (MFP) Demonstration Program. The MFP Demonstration Program was initially authorized by Congress in section 6071 of the Deficit Reduction Act of 2006 and was amended by section 2403 of the Affordable Care Act.

The MFP Demonstration Program was designed to help Medicaid recipients transition from institutions to the community, as well as assist States to balance their long-term care systems and increase the use of Home and Community Based Services.

The South Dakota Money Follows the Person program aims to provide people who are elderly, physically disabled, or have mental retardation and/or a developmental disability the opportunity for transition from institutional settings where they have resided for 90 days or more to the community. In its application, the State projected that 136 people will be transitioned during calendar years 2013 through 2016. The initial focus of the project will be younger individuals who are physically disabled, as well as individuals with developmental disabilities transitioning from the South Dakota Developmental Center. Potential participants will meet the following eligibility criteria:

  1. Is a South Dakota resident;
  2. Has been residing in a nursing facility, ICF/MR or other qualifying institution for more than 90 consecutive days;
  3. Meets Medicaid eligibility criteria at least one month prior to transition;
  4. Is willing to enroll in and can be supported in the community through the provision of an existing 1915(c)HCBS waiver; and
  5. Expresses a desire to live and receive services in a home and community based setting.

Program participants will be supported by two types of services during the initial 365 days post-transition. Qualified services are those services already in place through the Medicaid State Plan or the HCBS 1915(c) waiver in which the participant will enroll. Demonstration services are those services put in place solely for the MFP demonstration program. The qualified services and demonstration services will work in concert for the first 365-days following transition and the qualified services will provide for continuity of care long-term.

In preparation for program implementation, the Department is conducting a number of activities, including stakeholder meetings and preparing outreach materials. If you have questions about Money Follows the Person or would like to share your input, please contact Ann Schwartz at 605-773-3495.

Synagis Injections

Medicaid criteria for prior authorization of Synagis (palivizumab) injections have been updated for the upcoming RSV season (November-March). The American Academy of Pediatrics (AAP) published new guidelines for infants and children at risk for severe illness due to RSV in 2009. Before adopting these suggested parameters, the Division of Medical Services elected to wait and review the results and implications of using the criteria. No evidence has been found that the use of these recommended guidelines has led to an increase in morbidity in the group of children with gestational ages from 32 to 35 6/7 weeks who are older than 3 months of age at the onset of the RSV season.

The Division of Medical Services has adjusted Synagis coverage criteria to reflect those findings. Children who qualify for RSV prophylaxis at the start of RSV season will be authorized to receive the entire series of injections for that season. Click here to view the new criteria and updated prior authorization request form.

The Division of Medical Services will also require that you place the appropriate NDC code in Box 24J in the shaded area above the dates of service when you bill procedure code 90378.  The two NDC codes applicable to Synagis are 60574411301 Synagis 100mg/ml or 60574411401 Synagis 50mg/0.5ml.  Two claim lines should be billed if both are used. If one of these two codes is not present on a claim with HCPC 90378, the claim will deny for --Error code 121--NDC is missing. HCPC 90378 units are billable as 1 unit per 50mg for NDC. 60574411401 and 1 unit per 100 mg for NDC 60574411301.

Top Three Reasons for Claim Denials in FY12 by Provider Type


Denial Reason






Nursing Homes














Provider/Revenue Code Check










Recipient Requires Review










Recipient Not Eligible for Date of Service










Diagnosis/Procedure Restriction










Recipient has Private Health Insurance










Credit Amount does not equal Recipient Credit Amount










PCP/NPI # Incorrect










No Classifications for Claim










Claim exceeds 6 months










Exact Duplicate












In February 2012, SD Medical Services released a provider bulletin regarding Erroneous Claim Billing Errors.

Now we have compiled a list of the top three reasons provider claims were denied, by provider type, during state fiscal year 2012. In order to minimize claim error submissions, use these helpful hints to avoid claim denials.

Provider Revenue Code Check: The Long Term Care and Hospice Manuals outline the revenue codes required for Hospice and Nursing Home Claims. Providers should review the manuals available on our website. Revenue codes are appropriate to the specific provider type.

Recipient Not Eligible On Date of Service: Check eligibility for recipients by using the various sources for eligibility verification. (See related article on eligibility inquiries in this newsletter)

Diagnosis/Procedure Restriction: Review the procedure codes/diagnosis codes billed, for appropriateness\compatibility. If you disagree with the denial reason, contact the Telephone Service Unit (TSU) at 1-800-452-7691.

Recipient has Private Health Insurance: SD Medicaid indicates a third party payment responsibility either on the claim or in the recipient's eligibility information. This requires supporting documentation of payment or denial (EOB) from that source before Medicaid can pay the claim appropriately. Medicaid is the payer of last resort.

Credit Amount Does Not Equal Recipient Credit Amount: Recipients residing in nursing homes and hospice facilities are assessed a co-pay or cost share on a monthly basis. When a nursing home resident is transferred to Hospice, the remaining cost share/co-pay must be applied to the hospice claim. Hospice providers must coordinate with the transferring nursing home for accurate reporting of the remaining cost share to submit the hospice claim correctly.

PCP/NPI Incorrect: Managed Care recipients must have a referral from their Primary Care Physician (PCP) for applicable non-emergent specialized services or inpatient admissions. Claims must include the correct PCP information on the submitted claim.

No Classifications for Claim: Nursing home and hospice residents have a classification score established that is used in the pricing of the claim. This edit denotes that no score has yet been assigned to the resident. Review the medical record number on the MDS to insure that the number is correct, review that the Medicaid recipient number has been entered and insure that the MDS have been filed on the resident.

Claim Exceeds 6 Month Limit: Review the timely filing Administrative Rule of South Dakota. Providers should monitor their submission of claims based on the date of service and reconcile their remittance advice notices to insure that are meeting the timely filing restrictions.

Exact Duplicate: SD Medicaid has previously paid or is currently pending a claim for the same recipient, from the same provider, for the same procedure on the same or overlapping date(s) of service. Reconciliation of all Medicaid payments received should occur before resubmitting any claims again.

The Division of Medical Services strives to process all submitted claims in as efficient and expedient manner as possible the first time. It is extremely beneficial to the provider to submit all claims in compliance with existing Medicaid claim submission guidelines and Administrative Rules of South Dakota.

Recipient Eligibility Verification Inquiries

Recipients must present their Medical Assistance Program identification card to a Medical Assistance Program provider each time, before obtaining a Medical Assistance Program covered service. Failure to present their Medical Assistance Program identification card is cause for payment denial. Payment for denied services becomes the responsibility of the recipient.

Providers that do not obtain this identification card information from a recipient should attempt to obtain this information from the recipient prior to requesting eligibility information.

With the information available from the recipient eligibility card, providers may use one of several automated methods to obtain eligibility information.

Electronic Verification
The Medicaid Eligibility Verification System (MEVS) gives providers immediate access to a patient's eligibility status for a current or previous date of service. MEVS offers three ways for a provider to access South Dakota's recipient eligibility file. All three options provide prompt response times and printable receipts, and can verify eligibility status for prior dates of service.

Point of Service Terminal - The terminal is a swipe device that works similarly to credit card verification. This device allows recipients to swipe their Medical Assistance Program identification card. This device can be purchased or leased.

PC Software - Using this software, providers may enter the nine digit recipient ID (RID#), and obtain an accurate return of eligibility information.

Secure Web-Based Site - Providers may enter the nine digit recipient ID (RID#) on the secure website to obtain an accurate return of eligibility info.

These services are available through Web MD Emdeon. There is a nominal fee for each verification obtained through Emdeon. For information about the MEVS system, new customers may contact Emdeon at 1-866-369-8805 or at 1-877-469-3263 for existing customers. Providers may also visit Emdeon's website at

Telephone Audio Response Unit
As an alternative to electronic verification, providers may use the SD Medical Assistance telephone audio response unit (ARU) by calling 1-800-452-7691. Each call takes approximately one minute to complete. This system is limited to current eligibility verification only and five inquiries at a time. This call can be completed through a series of questions asked of the provider with a computer generated response. If the provider needs to visit with a telephone service representative they may do so.

Written Requests
Whenever possible, the Division of Medical Services recommends that providers utilize our automated systems. Written requests are limited to 5 recipient eligibility verifications and the Division of Medical Services has 30 days from the requested date to respond. The request may be denied if it does not contain the following information:

  • The provider's SD Medicaid ID or NPI number. All providers submitting requests must be currently enrolled.
  • The recipient's SD Medicaid ID or a combination of the following:
    • Recipient Last Name, First Name and Date of Birth
    • Recipient Last Name, First Name and Social Security Number
  • The date(s) for which eligibility is requested.
  • The date the service was provided to the recipient. The provider must be providing a service to the recipient.
  • The services for which eligibility is requested. (Optional)

South Dakota Medical Services will assist all providers in verifying eligibility for recipients when the HIPAA compliant standards are met for the release of Protected Health Information.

As a reminder to providers, securing the recipient ID card is the best way for you to obtain additional information on the benefits available to a recipient. Verification of eligibility is not a guarantee of claim payment. Providers should review the Provider Manuals and SD Administrative Rules available here.


Comments or questions?
Contact Medical Services

South Dakota Department of Social Services

Division of Medical Services
700 Governors Drive
Pierre, SD 57501
Phone 605.773.3495

Fax 605.773.5246

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