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Pharmacy Terms, Acronyms, and Definitions






A/B Rated

Drug products made by different distributors and/or re-packagers that are considered therapeutically equivalent based on demonstrated bioequivalence.


Incidents or practices that are inconsistent with accepted medical, business, or fiscal procedures.

Adjudication Cycle

System processing of claims at the point where a decision has been made to pay, deny or suspend.

Affiliated Computer Services (ACS)


Wyoming Medicaid Pharmacy Benefit Manager prior to May 28, 2009 and also called Xerox.

Aids Drug Assistance Program (ADAP)


Special pharmacy program covers certain drugs for eligible individuals with HIV/AIDS.  ADAP is funded through Title II of the Federal Social Security Act.

Allowable Charge

Specific dollar amount of a medical claim Medicaid will pay.


Process for reconsideration of a denied claim.


Official approval for action taken for, or on behalf of, a Medicaid client.  This approval is only valid if the client is eligible on the date of service.

Authorized Prescriber

Physician, osteopath, dentist, nurse, physician assistant, optometrist, naturopath, or other person duly authorized to prescribe drugs.

Average Manufacturer Price (AMP)


Average price paid to manufacturers by wholesalers for drugs distributed to the retail pharmacy.

Average Wholesale Price (AWP)


Average of list prices charged by wholesalers to pharmacies.

Bank Identification Number


Bank Identification Number is the identifier number for the payer.

Blue Book

A database of drugs that is updated weekly by First DataBank (FDB).

Brand Name

Proprietary or trade name selected by the manufacturer and placed upon a drug, its container, label, or wrapping at the time of packaging.

Center for Medicare and Medicaid Services (CMS)


Administers the Medicare and Medicaid programs.  Formerly the Health Care Financing Administration (HCFA).

Chemical Name

The chemical name is a proper scientific name for an ingredient of a product.


Information submitted to insurers requesting payment for covered services.

Compound Drug

A prescription drug prepared by a pharmacist using at least two or more active ingredients.


Combining two or more active ingredients or adjusting therapeutic strengths in the preparation of a prescription.


Participant's financial responsibility for a prescription assigned by Medicaid.  Unless exempt, recipients must pay $3.65/prescription for non-preferred brand-name drugs, or $3.65/prescription for preferred brand-name drugs, or $0.65/prescription for generic drugs.  Exempt recipients include residents of a nursing facility or in swing beds, pregnant clients, clients under the age of 21, family planning services, emergency services, or hospice services.

Date of Service (DOS)


The calendar date on which a specific medical service is performed.

Day Supply


Day supply of tablets, capsules, fluids (cc’s), etc., prescribed for the recipient. Day supply is the total number of days a patient's prescription lasts when taken as directed, not the duration of treatment.


Equipment or apparatus used to remedy or compensate for a physical deficiency, e.g., a prosthetic device.

Dispensed As Written (DAW)


Codes to be used by providers to explain the dispensing of a brand-name product instead of a generic one.

Dispensing Fee

Amount of Medicaid reimbursement allowed by the OPS as payment for the service of dispensing any prescribed drug. Current dispensing fee is $5.00.

Drug Efficacy Study Implementation (DESI)


Drugs determined by the FDA as lacking substantial evidence of effectiveness.  If the index is low, the drug is classified as "less than effective".

Drug Enforcement Administration (DEA) Number

DEA Number

Federal registry number used to identify a prescriber.

Drug Utilization Review


Program designed to measure and assess (prospective and retrospective) the proper use of outpatient drugs in the Medicaid program.  Primary objective of the DUR systems are to improve the quality of care and to assist in containing health care costs.  Prospective DUR is a system within the Pharmacy point-of-sale (POS) system that assists pharmacy providers in screening selected drug categories for clinically important potential drug therapy problems before the prescription is dispensed to the recipient. Retrospective DUR screens after the prescription has been dispensed to the recipient through drug profiling and peer grouping.

Drug Utilization Review (DUR) Board

DUR Board

Group of actively practicing healthcare professionals responsible for the establishment and implementation of medical standards and criteria for the prospective and retrospective DUR programs.
DUR Board makes recommendations for education interventions to prescribers and pharmacists to identify and reduce patterns of fraud, abuse, gross overuse, and inappropriate or medically unnecessary care.

Dual Eligible

Medicaid recipients who are also eligible for health benefit under Medicare or other public-sponsored health program.

Durable Medical Equipment (DME)


Medical equipment used repeatedly in the treatment of illness and injury.  These items may be reusable, such as walkers or wheelchairs.

Federal Drug Rebates

Payment made by pharmaceutical manufacturers to the states to receive Federal matching funds for drugs dispensed to Medicaid recipients through OBRA '90.

Federal Upper Limit (FUL)


Maximum allowable cost established by CMS for certain prescribed drugs.  The concept of the upper limits program is to achieve savings by taking advantage of the current market prices.

Federal Upper Limit (FUL): Amount established by the Centers for Medicare and Medicaid Services (CMS), U.S. Department of Health and Human Services, as the maximum amount for payment for a multiple source drug in a State Medicaid Program. Until Spring 2007, a State’s total drug program payments for multi-source drugs could not exceed, in the aggregate, an amount established by CMS that is equal to 150 percent of the published price for the least costly therapeutic equivalent (using all available national compendia). After Spring 2007, the FUL will be calculated at 250 percent AMP (computed without regard to prompt pay discounts extended to wholesalers). Until passage of the DRA, FULs could not be established until there were at least three equivalent drugs (the original brand name drug and two generics) on the market. After Spring 2007, FULs will be established once there is a second equivalent on the market.

Fiscal Agents

The Medicaid fiscal agent is under contract to certify providers, process and pay claims, answer provider and recipient questions, issue identification cards to recipients, and publish information for providers and recipient. Wyoming's pharmacy fiscal agent is GHS.

Fill Date

Date a prescription was filled.

Food & Drug Administration (FDA)


United States Department of Health and Human Services responsible for regulating food, dietary supplements, drugs, biological medical products, blood products, medical devices, radiation-emitting devices, veterinary products, and cosmetics in the United States.


An intentional deception or misrepresentation that someone makes, knowing it is false, that could result in the payment of an unauthorized benefit.

Generic Code Number


Number used to identify generic formulation of a drug.

Generic Drug

Identical,or bioequivalent to a brand name drug in dosage form, safety, strength, route of administration, quality, performance, characteristics, and intended use.  Generic drugs usually cost less than brand-name drugs and are required by the Food and Drug Administration (FDA) to be as safe and as effective as the brand-name drug.

Generic Name

Official title of a drug or drug ingredients published in the latest edition of a pharmacopeia or formulary.

Generic Sequence Number


Generic Sequence Number GSN uniquely identifies a product/formulation specific to its agent, dosage form, and strength, and route of administration. It is not unique across manufacturers and/or package sizes. The GSN is used to group generically equivalent pharmaceutical products.

Goold Health Systems, Inc.


Wyoming Medicaid Pharmacy Benefit Manager beginning May 28, 2009.

Health Care Financing Administration (HCFA)


Federal agency that administers the Medicare, Medicaid and Child Health Insurance Programs (CHIP).

Health Insurance Portability and Accounting Act (HIPAA)


Federal act designed to increase efficiency of the health care system by establishing standards for transmission, storage, and handling of data.

Healthcare Common Procedure Coding System (HCPC)


Set of health care procedure codes based on the American Medical Association's Current Procedural Terminology (CPT). Commonly pronounced “Hick-Picks”.

International Classification of Diseases-9th Revision, Clinical Modification 
(ICD-9 CM)


International Classification of Diseases, 9th Revision, Clinical modification.  Nomenclature for medical diagnoses required for billing.


A subset of the HCPCS Level II code set with a high-order value of "J" that has been used to identify certain drugs and other items.

Legend Drug

Any drug that requires a prescription under federal code 21 USC 353(b).

Lock-In Program


Pharmacy Services Lock-In Program restricts a patient to filling all of his or her prescriptions at one pharmacy. The purpose of this program is to control duplicate and inappropriate drug therapies. Any Medicaid recipient who receives narcotic prescriptions from two (2) or more physicians and utilizes two (2) or more pharmacies are candidates for the program.  Medicaid histories are reviewed so that recipients with certain diagnoses including cancer are excluded from lock-in.

Maintenance Drug

Drugs furnished to an individual with a chronic illness or condition.  The Department designates drugs as maintenance drugs based on therapeutic value, clinical consultation with practitioners, and applicable CMS guidelines.


Title XIX

Medical assistance program authorized under Title XIX of the Social Security Act.  Program provides health care coverage to low-income families with children, pregnant women, disabled people, and the elderly.

Medical Supplies

Disposable, semi-disposable, or expendable medical supplies.  This does not include durable medical equipment, oxygen, or oxygen supplies.

Medically Necessary

Pharmaceutical service that is consistent with the recipient's diagnosis or condition; recognized as the prevailing standard or current practice among the provider's peer groups; and rendered in response to a life-threatening condition or paint; to treat an injury, illness or infection; to treat a condition that could result in physical or mental disability; to care for a mother and child through the maternity period; or to achieve a level of physical or mental function which is consistent with prevailing community standards; or is a preventive pharmaceutical service.


Health insurance program for the aged and disabled under Title XVIII of the Social Security Act.

Multi-Source Brand Drug

A brand drug for which the patent has expired.

National Association of Board of Pharmacies (NABP)


Independent, international, and impartial association that assists its member boards and jurisdictions in developing, implementing, and enforcing uniform standards for the purpose of protecting the public health.

National Council for Prescription Drug Programs (NCPDP)


Entity creates and promotes standards for the transfer of data to and from the pharmacy services sector of the healthcare industry.

National Drug Code (NDC)


Eleven-digit code assigned to each drug.  The first five numbers indicate the labeler code (CMS assigned), the next four numbers indicate the drug and strength (manufacturer assigned), and the remaining two numbers indicate the package size (manufacturer assigned).

National Provider Identifier (NPI)


Unique identification number for covered health care providers.  Under HIPAA, NPIs will be used in administrative and financial transactions.  NPI Registry:

Non-Rebate Drugs

Drugs manufactured or distributed who have not signed a drug rebate agreement with the federal Department of Health and Human Services.

Omnibus Budget Reconciliation Act (OBRA)


Federal legislation defines Medicaid drug coverage requirements and drug rebate rules.

Orange Book Code


Orange Book Code (OBC) identifies the therapeutic equivalency ratings assigned to each approved prescription product according to the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations.

Over-the-Counter (OTC) Drug


Non-legend drugs that do not require a prescription before they can be dispensed.


A person licensed to practice pharmacy by the Wyoming State Board of Pharmacy or a similar board or agency in another state.


An entity licensed to operate a pharmacy by the Wyoming State Board of Pharmacy or a similar board or agency in another state.

Pharmacy Services


Oversees Medicaid Pharmacy Prescription Program and other state programs.

Pharmacy & Therapeutics Committee (P&T)


A committee that is comprised of physicians, pharmacists and a nurse practitioner all practicing in their respective fields in Wyoming. The purpose of the committee is to enhance quality of patient care by assuring appropriate drug therapy, optimal patient outcomes, and education for health care providers.


A person licensed to practice medicine or osteopathy by the Wyoming State Board of Medical Examiners or a similar board or agency in another state.

Point-of-Sale (POS)


Pharmacy claims processing system capable of adjudicating claims on-line.


A physician or other licensed practitioner of the healing arts authorized to prescribe drugs and practicing within the scope of professional practice as defined under Wyoming Statutes or the laws of another state.

Preferred Drug List (PDL)


A list of preferred pharmaceutical substances within a therapeutic class designed to maximize clinical and economic benefits as determined by the Department in consultation with the Preferred Drug List Advisory Committee. The PDL identifies medications providers may prescribe without seeking a prior authorization (PA); a provider must seek approval from WY Medicaid through a PA for medications not on the list before they can be dispensed.



A written, faxed, or oral order, as required by the Board of Pharmacy, from a practitioner that a certain drug, medical supply, device or service is medically necessary.

Prescription Drug Assistance Program (PDAP)


State funded pharmaceutical assistance program. For qualifying individuals, the benefit allows three (3) prescriptions per month. Prescriptions are limited to a month’s supply and the copay is $10 per prescription for a generic drug and $25 per prescription for a brand-name drug. Eligibility for the program is determined by the WY Department of Family Services and clients are eligible for a period of one year.

Prior Authorization (PA)


Approval process required before certain services or supplies are paid by Medicaid.  Prior authorization must be obtained before providing the service or supply.

Program Integrity Unit

Reviews claims submitted for payment; Reviews medical records and documents related to covered services; Conducts on-site reviews of medical records and/or client interviews; Reviews client Explanation of Medical Benefits (EOMB) responses; Case Management oversight; and Operation of the Surveillance/Utilization Review process (SUR).


Individual or entity furnishing medical, mental health, dental or pharmacy services.


A person who has been determined eligible for Medicaid.


Penalty for noncompliance with laws, rules, and policies regarding Medicaid, which may include withholding payment from a provider or terminating Medicaid enrollment.


Drugs, medical supplies, and devices that are reimbursable.

Single-Source Brand

A brand drug for which the patent has not expired and is not a co-branded drug.

State Maximum Allowable Cost (SMAC)


State maximum allowable cost for drug products established by the OPS.  The OPS has contracted with Goold Health Systems (GHS) to provide assistance in establishing and maintaining the SMAC program for generic pharmaceuticals.

Supplemental Drug Rebate

Payment from a pharmaceutical manufacturer negotiated by the state, in addition to the Federal rebate.

Surveillance Utilization Review System


Utilization review for Medicaid Pharmacy Program

Therapeutically Equivalent

Drug products with the same efficacy and toxicity when administered to an individual in the same dosage regimen.

Third Party Liability (TPL)


Entity that is, or may be, liable to pay all or part of the medical cost of care for Medicaid.

Title XIX

Title XIX

Medicaid Program authorized by the Federal Social Security Act.

Usual and Customary

Fee provider most frequently charges the general public for service or item.