Contrary to federal law, the Centers for Medicare & Medicaid Services accepted $15.1 million in gross drug costs for prescriptions written by excluded providers from 2006 to 2008 under the Medicare Part D program, according to a recent report from the Office of Inspector General (OIG).
Excluded providers are physicians or other healthcare professionals who are excluded from federal healthcare programs. Federal law prohibits payment under federal healthcare programs for prescriptions written by excluded providers when the person dispensing the prescription knows or has reason to know of the exclusion. CMS maintains a database of excluded providers, the Medicare Exclusion Database (MED).
[See also: Medicare Part D costs to be lower than expected in 2009]
In a summary of its findings, OIG stated, "CMS accepted (prescription drug event) data submitted by sponsors for prescriptions written by excluded providers because it had inadequate internal controls in place during our review. Specifically, CMS did not provide sponsors with access to the MED to accurately and effectively identify excluded providers. In addition, CMS allowed sponsors to use state license numbers, which are not unique identifiers, and did not have an edit in place to reject PDE data submitted by sponsors for prescriptions written by excluded providers."
OIG recommendations are for CMS to:
• resolve improper Part D payments made for prescriptions written by excluded providers by reopening and revising calendar year 2006 through 2008 final payment determinations to remove prescriptions written by excluded providers.
• strengthen internal controls to ensure that, in accordance with federal regulations, prescriptions written by excluded providers are not paid under the Part D program by: (a) researching and incorporating into the MED all of the provider identifiers that CMS allows sponsors to use; (b) providing sponsors with access to the MED and requiring them to use the MED to ensure that prescriptions written by excluded providers are not accepted; (c) prohibiting sponsors from using state license numbers in the prescriber identifier field of PDE records; and (d) establishing an edit that would reject any PDE data submitted by sponsors for prescriptions written by excluded providers.
CMS concurred with the first recommendation and partially concurred with the second recommendation.
In written comments on the OIG draft report, CMS said it would explore the "feasibility and cost-effectiveness of implementing" OIG's first recommendation.