13-570 Code Vt. R. 13-170-570-X
The legislature authorized the creation of the Healthy Vermonters program with the passage of Act 127 (2002). This program provides a pharmacy discount to eligible Vermonters, helping beneficiaries purchase prescription medicines necessary to maintain their health and prevent unnecessary health problems. The rules that follow describe this pharmacy program.
A person who knowingly gives false or misleading information or holds back needed information in order to obtain Healthy Vermonters benefits may be prosecuted for fraud under Vermont law or federal law or both. If convicted, the individual may be fined or imprisoned or both.
When the ESD learns that fraud may have been committed, it will investigate the case with respect for confidentiality and the legal rights of the beneficiary. If appropriate, the case will be referred to the State's Attorney or Attorney General for a decision on whether or not to prosecute.
(05/01/2010, 10-02)
Individuals are eligible for Healthy Vermonters if they have household income no greater than 350 percent of the federal poverty level (FPL), as calculated under the rules for the VHAP program.
Individuals are also eligible for Healthy Vermonters if they have household income no greater than 400 percent of the FPL, as calculated under the rules for the VHAP program (5300), and meet the categorical eligibility requirements.
The following table presents the eligibility requirements.
Eligibility Requirements for Healthy Vermonters
Income Maximum | Categorical Eligibility Requirement |
350 Percent of the FPL | None |
400 percent of the FPL | Age 65 or older |
Or disabled | |
Or disabled and eligible for social security disability benefits |
Individuals remain eligible as long as they meet all program requirements.
Individuals must be without adequate coverage for prescription drugs to be eligible. Individuals are considered without adequate coverage if they have no insurance policy or program benefit that includes any prescription drug coverage; however, beneficiaries on Part D in an MA-PD or PDP plan will be considered uninsured as to excluded Part D drug classes, except to the extent that such drugs are covered by the MA-PD or PDP plans. They are also considered without adequate coverage if no prescription drugs are covered under their policy because they have reached the annual maximum coverage limit.
The department considers individuals covered by VHAP-Pharmacy insured because that program has prescription drug coverage and no annual maximum. Beneficiaries who are eligible for Part D must be enrolled in a Part D prescription drug plan or a Medicare Advantage-Prescription Drug benefit plan to be eligible for Healthy Vermonters. The department considers individuals covered by VScript, including VScript expanded, to be uninsured for drugs that are excluded from VScript coverage (3202) and for drug classes that are excluded under Part D coverage (3403.4) for Medicare beneficiaries, and automatically extends coverage for these drugs under the Healthy Vermonters program.
The rules for citizen ship and identity are in section M170.
An individual must be a state resident to be eligible. Individuals are considered state residents if they are living in Vermont at the time of submitting the application for the Healthy Vermonters Program:
Temporary absences from Vermont for any of the following purposes do not interrupt or end Vermont residence: visiting, obtaining necessary medical care, or obtaining education or training under a program of vocational rehabilitation or higher education.
An individual must remain in contact with the department by providing an up-to-date address.
An individual must be living outside a correctional facility, including a juvenile facility, to be eligible. Psychiatric and drug or alcohol treatment facilities are not considered correctional facilities.
An individual must be a member of a Healthy Vermonters group with countable income under the applicable income test to meet this requirement.
A Healthy Vermonters group includes all of the following individuals, if living in the same home:
The Healthy Vermonters group shall not include any individual receiving Reach Up or SSI/AABD benefits, and the income of these individuals living in the household shall not be considered in determining eligibility.
Countable income is all earned and unearned income, as defined in this section, less all allowed deductions. Income in the month of application (or review) and future months is estimated based on income in the calendar month prior to the month of application (or review) unless this income does not accurately reflect ongoing income. If changes are expected to occur, an estimate of income based on current information should be used.
To determine countable monthly income, average weekly income is multiplied by 4.3 and average bi-weekly income is multiplied by 2.15.
Lump sum benefits that would have been counted as income if received on time, such as social security benefits and unemployment compensation, shall be added to all other countable income of an applicant for or beneficiary of Healthy Vermonters and counted only in the month of receipt.
Windfall lump sums such as insurance payments and money received from the sale of a resource, including the sale of an excluded resource, are not counted.
An insurance payment or similar third party payment received and used for a specific purpose, such as the payment of medical bills or funeral costs, is excluded. Payments not used for the stated purpose are counted as income in the month received.
Unearned income includes, but is not limited to, the following:
. Income from pension and benefit programs, such as social security, railroad retirement, veteran's pension or compensation, unemployment compensation, and employer or individual private pension plans or annuities.
. Interest and dividends.
. Child support payments (see 3401.52 (v) for the exclusion of the first $ 50) and alimony payments.
. Income from capital investments in which the individual is not actively engaged in managerial effort.
. Time payments on mortgages or notes resulting from a casual sale (i.e., a sale not related to self-employment) of real or personal property.
. Voluntary contributions from others.
Unearned income does not include the following:
. Infrequent or irregular voluntary cash contributions or gifts, such as Christmas, birthday, or graduation presents, received from friends or relatives.
. In-kind income.
. Five percent of a VA monthly award retained by a guardian.
Earned income includes all wages, salary, commissions, or profit from activities in which the individual is engaged as an employee or a self-employed person, including, but not limited to, active management of capital investments (e.g., rental property).
Earned income is defined as income before any deductions for income taxes, FICA, insurance or any other deductions voluntary or involuntary except that, in determining earned income for self-employed individuals, business expenses are deducted first.
Earnings over a period of time, for which settlement is made at one given time, are also included (e.g., sale of farm crops, livestock, poultry). Monthly income is determined by dividing the settlement by the number of months in which it was earned.
Earned income does not include in-kind income.
The following items are deducted from gross earned income in the sequence listed:
. Business expenses (self-employment only)
. Standard employment expense deduction
. Dependent care expenses
Business expenses, which are deducted from gross receipts to determine adjusted gross earned income, are limited to operating costs necessary to produce cash receipts, such as:
. Office or shop rental; taxes on farm or business property;
. Hired help;
. Interest on business loans; and
. Cost of materials, stock, and inventory, livestock for resale required for the production of this income.
Items such as personal business and entertainment expenses, personal transportation, purchase of capital equipment, depreciation, and payment on the principal of loans for capital assets or durable goods are not allowable business expenses.
Tax returns and business records are considered appropriate sources of accurate figures for farm and business receipts and expenses.
The income of a Healthy Vermonters group owning or operating a commercial boarding house shall be treated as any other business income. A commercial boarding house is defined as an establishment licensed as a commercial enterprise that offers meals and lodging for compensation. In areas without licensing requirements, a commercial boarding house shall be defined as a commercial establishment that offers meals and lodging with the intention of making a profit.
No computation is required for foster homes furnishing boarding care to children in custody of, and placed by, the Department of Social and Rehabilitation Services. Department board rates are established to cover expenses only, with no profit available; therefore, no earned income is considered available from this source.
For a Healthy Vermonters group that is not a commercial boarding house, the business expense of furnishing room and board, alone or as part of custodial care, shall be allowed, provided that the amount shall not exceed the payment the Healthy Vermonters group receives from the roomer or boarder for lodging and meals. (See the Medicaid Procedures Manual at P-2420 D2 for the table of standard business expense deductions for homes providing room or board on a non-commercial basis.)
The standard employment expense deduction is the first $ 90.00 earned per month after deduction of business expenses, where applicable.
The standard employment expense deduction is applied separately to the gross countable earned income of each individual in the Healthy Vermonters group who is employed or self-employed.
Dependent care expenses necessary to enable the individual to retain his or her employment or accept employment will be deducted up to a maximum of $ 175.00 per month for the care of each member of the Healthy Vermonters group who is an incapacitated adult or a child age two years or older. Up to a maximum of $ 200 per month may be deducted for the care of each child under two years of age who is a member of the Healthy Vermonters group.
Dependent care expenses for the care of a child are not deducted unless the child requiring care is a member of the Healthy Vermonters group or is not a member of the Healthy Vermonters group solely because the child is an SSI/AABD or an Reach Up recipient and is:
Dependent care expenses will be allowed as paid up to the maximum. If a recipient's dependent care expenses are below the maximum, transportation to and from the dependent care facility may be deducted as part of the expense up to the maximum for both dependent care and transportation.
Payments for dependent care provided by a member of the same Healthy Vermonters group, by the child's biological or adoptive parent, stepparent, or legal guardian, or by the spouse of an incapacitated adult do not qualify as necessary dependent care expenses under this policy.
The provider of care must be at least 16 years of age. A deduction for dependent care expenses for care of a child can be allowed only when neither parent is available and able to provide the necessary care. A deduction for dependent care expenses for care of an incapacitated adult can only be allowed when the incapacitated adult's spouse, if any, is either unavailable, or available but unable to provide the necessary care due to incapacity. A spouse employed during the time care is required is considered unavailable.
Examples of excludable income sources are: federal Pell Grants, Vermont Student Assistance Corporation grants or loans, federal Supplemental Educational Opportunity Grants (SEOG), and federal College Work-Study Programs (CWSP).
That portion of any Veterans Administration Educational Assistance Program payment that is for the student and is actually used for tuition, books, fees, child care services or other expenses necessary for enrollment is also excluded.
Examples of programs in Title IV of the Higher Education Act include:
. Federal Pell Grants.
. Federal Supplemental Educational Opportunity Grants (SEOG).
. State Student Incentive Grants (SSIG).
. Federal College Work Study (CWSP).
. Federal Perkins Loans. These are different from loans under the Carl D. Perkins Vocational and Applied Technology Education Act, which are not totally disregarded (see #4).
. Educational loans under the federal Family Educational Loan Program or the federal Direct Student Loans Program (Stafford or PLUS loans).
Complete the following steps to determine countable income:
All otherwise eligible individuals in a Healthy Vermonters group who pass the income test are income-eligible for Healthy Vermonters.
Individuals potentially eligible for traditional Medicaid, such as pregnant women and children, have their eligibility determined under those rules but are considered members of the Healthy Vermonters group for purposes of determining the Healthy Vermonters group size and countable income.
(05/01/2010, 10-02)
Individuals are eligible for Healthy Vermonters if they have income no greater than 350 percent of the federal poverty level (FPL).
Individuals are also eligible for Healthy Vermonters if they have income no greater than 400 percent of the FPL and are: 65 or older; or disabled and eligible for social security disability benefits.
The income guidelines are updated annually on January 1 using a methodology similar to the one employed by the federal government in setting the FPLs. In years when the actual FPL exceeds ESD's income maximum, ESD will issue a second increase on April 1.
Eligibility for the Healthy Vermonters program includes the process described in the following subsections.
Between January 1 and June 15, individuals may apply for Healthy Vermonters by completing the application form provided in the state income tax return. The application form must be completed legibly and accurately, signed and dated by the applicant, and submitted to the Department of Taxes on or before June 15. The Department of Taxes shall perform such income verification by the Secretary as is requested and transmit applications to the department.
By signing or marking the rights and responsibilities statement on the application form, the applicant authorizes the department to verify any information on the form through collateral contacts such as the Internal Revenue Service or the Social Security Administration.
Applicants may also apply for the Healthy Vermonters program any time during the year by filing a Healthy Vermonters application with the Health Access Eligibility Unit (HAEU) or a PATH district office. Applicants must provide information about their situation relevant to the tests for eligibility ( Section 3401 ). Applications are date-stamped to assure that earlier applications are acted upon first. Applicants found eligible for VScript (including VScript Expanded) will be automatically enrolled in Healthy Vermonters.
Applicants must furnish their social security numbers or apply for a social security number unless they substantiate membership in a religious organization that objects to the use of a social security number. An applicant who substantiates membership in such an organization shall be given an alternate identification number.
Verification of the information provided is not generally required of the applicant or beneficiary unless it is questionable, verification is outstanding for another benefit program, or the applicant or beneficiary has refused to provide a social security number because of a religious objection. Social security numbers are used to verify information through tape matches. Clients are notified on the application form of the verification actions the department may take, including the use of verification obtained for other department programs, randomly selected quality control reviews, and the penalties for fraudulent reporting of their situation.
The Health Access Eligibility Unit (HAEU) or department district office must make an eligibility decision within 30 days of the date the application is received.
An applicant will be sent a notice regarding the action being taken on the application. An applicant who is denied will be sent a denial notice that includes the reason for the denial and the applicant's appeal rights. An applicant with countable income over the income maximum (3401.54) shall be denied and may reapply at any time.
Eligibility for individuals who do not receive VScript begins the date of eligibility approval and ends June 30 unless the individual fails to meet a program requirement, in which case eligibility ends 11 days after the department sends the individual a notice of closure. Eligibility for individuals granted Healthy Vermonters coverage who receive VScript begins the date of eligibility approval and ends June 30.
If Healthy Vermonters eligibility begins on or after January 1 but no later than June 30, coverage continues through June 30 of the following year. If Healthy Vermonters eligibility begins on or after July 1 but no later than December 31, coverage continues through June 30 of the next year.
For coverage to continue beyond the June 30 closure date, all beneficiaries must file a new application and be found eligible.
When beneficiaries become ineligible by failing to meet program requirements, the department must mail them a notice of decision regarding the termination at least 11 days before the effective date of termination, unless the department confirms beneficiaries:
. have moved out of state;
. have been admitted to an institution where they are ineligible for further services;
. have voluntarily withdrawn from the program;
. were found to be ineligible on the date coverage began;
. are no longer in contact with the department, and department notices to the beneficiary are returned by the post office indicating no forwarding address; or
. have died.
Applicants and beneficiaries must report changes in income and household composition within 10 days after learning of the change. They must also notify the Department within 10 days after they:
. become eligible for insurance or other assistance covering prescription drugs;
. no longer meet state residency requirements (3401.3);
. are incarcerated; or
. have a change of address.
The Department shall provide each eligible Healthy Vermonters individual with an identification card. This identification card may be used only at participating pharmacies as defined at 3403.5.
Individuals accepted into the Healthy Vermonters program may apply for the traditional Medicaid program or any other health care program at any time.
Individuals who wish to apply for traditional Medicaid or other benefits available through the Department must file an application as required under those programs.
The Department will provide applicants and beneficiaries with notices whenever they are found ineligible for the Healthy Vermonters program or when the services they may receive under the Healthy Vermonters program are denied, reduced or discontinued. The notice shall include a statement of the intended action, the reason for the action and an explanation of the individual's right to request an internal managed care organization ("MCO") appeal and a fair hearing before the Human Services Board. Appeals regarding denials of eligibility will not be entitled to an internal MCO appeal.
Regarding eligibility issues, a request for a fair hearing must be made within ninety (90) days of the date the notice of the decision being appealed was mailed. A request for a hearing is defined as a clear expression, oral or written, that the individual wishes to appeal a decision or that he/she wants an opportunity to present his/her case to a higher authority.
Regarding issues of coverage, a beneficiary may utilize the internal MCO appeal process (see M181) while a fair hearing is pending or before a fair hearing is requested (see M182). Fair hearings or MCO appeals must be filed within 90 days of the date the notice of action was mailed by the MCO, or if no mailing, within 90 days after the action occurred. A request for a fair hearing challenging an MCO appeal decision must be made within ninety (90) days of the date the original notice of the MCO decision being appealed was made, or within thirty (30) days of the date the notice of the MCO decision being appealed was mailed.
When beneficiaries appeal a decision to end Healthy Vermonters coverage, they have the right, under certain conditions, to have benefits continue without change until the appeal or fair hearing is decided provided the beneficiary has requested an appeal before the effective date of the change.
Continuation of benefits without change does not apply when the appeal is based solely on a reduction or elimination of a benefit required by federal or state law affecting some or all beneficiaries, or when the decision does not require the minimum advance notice (see Notice of Decision at M141).
Beneficiaries who waive their right to continued benefits will be reimbursed for out-of-pocket expenses for covered services provided during the appeal period in any case in which the Human Services Board reverses the decision.
Individuals eligible for this program receive assistance in purchasing covered drugs, defined at 3403.4, from participating pharmacies after payment of any required enrollment fee and coinsurance.
The amount of the benefit shall be the difference between the retail cost of the drug and the discounted cost.
The discounted cost shall be the price of the drug based on the Medicaid fee schedule, less payment by the state of at least 2 percent of the Medicaid rate, less the average rebate paid to the Medicaid program by pharmaceutical manufacturers for the prior state fiscal year, rounded down to the nearest whole or half dollar. The commissioner will establish the average rebate amount for each calendar year.
This discounted cost is subject to approval by the Centers for Medicare and Medicaid Services (CMS) of a research and demonstration program waiver under section 1115(a) of the Social Security Act. Until CMS approves the waiver, the discounted cost shall be the Medicaid rate.
For each calendar year, the commissioner shall set the required enrollment fee. Until CMS has approved the waiver, there will be no enrollment fee. When an enrollment fee is implemented, it will be per beneficiary, per year. It will be collected by requiring beneficiaries to pay an amount above the discounted price until the annual fee is reached.
The required coinsurance is the discounted cost of each prescription or refill. Each beneficiary shall be responsible for paying the required coinsurance and a participating pharmacy shall dispense a drug to an eligible beneficiary only upon payment of this coinsurance.
Prescription coverage is limited to drugs of manufacturers that have a rebate agreement in force.
Beneficiaries who are entitled to Medicare benefits under Part A or enrolled in Medicare Part B, and who live in the service area of a Part D plan, are defined under Medicare rules at 42 CFR § 423.30 as eligible for Part D. Vermont is included in the service area for several Part D plans. According to 42 CFR § 423.906, Medicare is the primary payer for covered drugs for Part D eligible individuals. HVP does not cover these drug classes.
Part D is administered either through a prescription drug plan (PDP) or as a component of Part C, Medicare managed care, in a Medicare Advantage -- Prescription Drug benefit (MA-PD).
The only drug classes that Healthy Vermonters covers for those enrolled in a drug plan, if they are not covered by the PDP/MA-PD, are:
If a Part D eligible individual elects not to enroll in a PDP/MA-PD plan, or discontinues enrollment in such a plan, coverage for these drugs will end.
When an individual appeals a denial of a drug's coverage under a Part D or Part C plan, and has exhausted the plan's appeal process through the IRE (Independent Review Entity) decision level, or the plan's transition plan as approved by the Centers for Medicare and Medicaid Services (CMS), the individual may apply to the Office of Vermont Health Access for the Healthy Vermonters benefit for the drug. If the individual's prescriber can document medical necessity in a manner established by the director of the Office of Vermont Health Access (OVHA), and the process for documentation conforms with the pharmacy best practice and cost control program established under subchapter 5 of chapter 19 of Title 33, the drug shall be allowed under Healthy Vermonters.
At the beginning of coverage under Medicare Part D, when an HVP-eligible individual has applied for and has attempted to enroll in a Part D or Part C plan and has not yet received coverage due to an operational problem with Medicare, or has otherwise not received coverage for the needed pharmaceutical, the necessary drugs will be covered, if OVHA finds that good cause and a hardship exist, until such time as the operational problem, good cause and hardship ends. The individual must have made every reasonable effort with CMS and the PDP, given the individual's circumstances, to obtain coverage. The intent of the good cause and hardship exception is remedial in nature and shall be interpreted accordingly. In general "good cause" shall include instances where the lack of coverage can not reasonably be considered the fault of the individual, and "hardship" shall include circumstances where alternative means for the coverage at issue are not reasonably available or will likely result in irreparable loss or serious harm to the individual. OVHA will make determinations of whether or not operational problems, good cause, or hardship exists for purposes of coverage.
"Pharmacy" means a retail or institutional drug outlet licensed by the Vermont State Board of Pharmacy pursuant to chapter 36 of Title 26, or by an equivalent board in another state, that sells prescription drugs at retail and has a written enrollment agreement with the state to dispense drugs.
A provider must:
. satisfactorily complete and submit the standard enrollment form to the Office of Vermont Health Access;
. conform to the standards of the Vermont State Board of Pharmacy and other federal and state statutes and regulations applicable to the dispensing of prescription drugs to the general public;
. agree to provide reasonable access to records necessary to comply with the provisions for program review set forth in the Provider Agreement;
. never deny services to, or otherwise discriminate against persons on the basis of race, color, sex, age, religious preference, national origin, handicap or sexual orientation; and
. take appropriate steps to prevent the wrong utilization of prescription drugs, with special concern for the potentially dangerous interaction of two or more prescription drugs from different prescribers.
13-570 Code Vt. R. 13-170-570-X
EFFECTIVE DATE: October 1, 2008 Secretary of State Rule Log #08-040 Bulletin #08-20; amended, renumbered and reorganized, see rule 13 170 000 for prior history and section conversion table. ; May 1, 2010 Secretary of State Rule Log #10-012