The Federal Upper Limit (FUL) is the maximum reimbursement amount allowed for certain drugs pursuant to Section 1927(e) of the Social Security Act (Act). The FUL requirement was created in 1987 in an effort to ensure that Medicaid was a prudent purchaser.

Section 2503(a)(1) of the Affordable Care Act (ACA) amended section 1927(e) of the Act by revising how FULs are calculated. Beginning in late March 2016, the Center for Medicare and Medicaid Services (CMS) will publish updated FULs monthly on the Medicaid.gov website.

The new FULs will be effective on the first date of the month following the publication of the update. States will have up to 30 days to implement each monthly FUL update.

Beginning April 2018, the monthly ACA FUL pharmacy pricing released by the Centers for Medicare and Medicaid Services (CMS) will be loaded as an automated file effective for dates of service beginning on the 1st of each month (rather than the 15th) and will remain in effect until the next CMS FUL release and system load.

Note: National Drug Codes (NDC) from specific manufactures as notated with a labeler code restriction in the Contract Drugs List (CDL) are exempt from FUL implementation.

Example: A NDC is listed on the CMS FUL page and the corresponding drug is listed in the CDL with the following notation: Restricted to NDC labeler code 12345 (Acme Healthcare) only.

NDCs for this drug with the labeler code 12345 are exempt from FUL implementation.