Drug Rebate Programs

CHIP Drug Rebate Program

The 76th Texas Legislature directed the Health and Human Services Commission (HHSC) to develop a program under the federally authorized State Children's Health Insurance Program (CHIP) (Title XXI of the federal Social Security Act, 42 U.S.C. §§ 1391aa-1397jj). CHIP is an optional program designed to provide affordable insurance to low- to middle-income families with uninsured children.

Utilization for CHIP is invoiced in two parts, based on the funding sources for the program. The largest portion of the CHIP utilization is jointly funded (state and federal participation). A much smaller portion of the CHIP utilization is for the state-only funded portion of CHIP, which covers legal immigrants that are not yet eligible for the jointly funded portion of the program.

Manufacturers wishing to participate in the CHIP rebate program should complete and sign the CHIP Drug Rebate Agreement and return two originals to Provider Synergies, LLC. Please refer questions regarding the CHIP rebate program to the Texas Contract Manager at (513) 774-8500. Signed contracts should be returned to:

Texas Contract Manager
Provider Synergies, L.L.C.
10100 Alliance Rd, Ste 201
Cincinnati, OH  45242

KHC/CSHCN Rebate Programs

Texas Health and Safety Code §§12.025 requires HHSC to establish a voluntary drug rebate program for all drug manufacturers whose products are covered by Kidney Health Care (KHC) and Children with Special Health Care Needs (CSHCN) Services Program. The 77th Texas Legislature General Appropriations Act, TDH Rider 38, authorized KHC and CSHCN to receive and use all rebate monies for client services, and to establish a preference for products from manufacturers who have signed rebate agreements with the program. KHC and CSHCN are committed to ensuring a 100 percent participation rate because of increased drug costs that have significantly impacted program budgets.

The Kidney Health Care program provides wrap-around Part D coverage for eligible clients. CMS has classified this program as a State Pharmaceutical Assistance Plan (SPAP). Manufacturers wishing to participate may download the KHC rebate agreement or CSHCN rebate agreement, complete and sign, and return two copies of each contract. Returned agreements should be addressed to:

Antoine Nelson
ACS-Pharmacy Rebate Operations
12365A Riata Trace Parkway
Austin, TX  78727

Rebate Contracts that Require Manufacturer Pricing

If a rebate agreement requires drug manufacturers to provide pricing data to the state on a quarterly basis, the pricing data should be submitted to:

Antoine Nelson
ACS-Pharmacy Rebate Operations
12365A Riata Trace Parkway
Austin, TX  78727

Or

Antoine.Nelson@tmhp.com and vdprebates@hhsc.state.tx.us

Manufacturer refunds

Drug manufacturers: when issuing a payment for drug rebate invoices, please include the invoice number as found on the invoice.  All payments should be sent to the following address:

Regular Mail:

Health and Human Services
Commission

Attn: ARTS, VDP Drug Rebates
P. O. Box 149055
Austin, Texas 78714-9055

Overnight Mail:

Health and Human Services Commission

Attn: ARTS, VDP Drug Rebates
1106 Clayton Lane, Ste. 240-E
Austin, Texas 78723

Disputing the Metric Decimal Quantity

Each calendar quarter, Vendor Drug summarizes all of the paid claims data by National Drug Code (NDC) number and bills the drug companies for their products. The drug company pays the invoice but may have questions about the state’s reported utilization. If this occurs, the rebate auditors provided by Vendor Drug's rebate administrator will review the claim level data for that specific NDC.  If the decimal is omitted or the quantity rounded up to the next whole number then the drug manufacturer disputes the claim.  Please refer to the Pharmacy Provider Procedure Manual, specifically section 4.3 Dispensing Limits and 9. Rebates to ensure you are correctly identifying the correct quantity and how Vendor Drug will adjust incorrect claims.