Experts Criticize Anti-Fraud Plan for Medicare Prescription Drug Benefit
Some experts are criticizing CMS' plan to combat fraud in the new Medicare prescription drug benefit, saying the benefit is "too complex to monitor properly and leaves too much discretion to the industries that have fleeced government health programs in the past," the Philadelphia Inquirer reports (Pugh, Philadelphia Inquirer, 10/10). On Friday, CMS Administrator Mark McClellan announced that Medicare has contracted with eight companies trained to detect fraudulent activity -- dubbed Medicare Rx Integrity Contractors -- to look for instances of fraud or abuse and conduct investigations (Ochs, Long Island Newsday, 10/9).
Medicare has identified 33 types of financial fraud possible in the new program. These include companies overreporting the number of prescriptions filled or billing for brand-name drugs when generic drugs were actually dispensed. Other fraudulent activity includes inflating drug prices and soliciting or receiving kickbacks (Philadelphia Inquirer, 10/10). McClellan said older U.S. residents are the primary target for consumer fraud and noted that two scams related to Medicare beneficiaries already are under investigation (Miller, Atlanta Journal-Constitution, 10/8). Investigators are examining incidents in Illinois and West Virginia in which beneficiaries were approached by people claiming to represent Medicare and asking for personal information.
McClellan noted the schemes affected only a few individuals (Long Island Newsday, 10/9). He said Medicare officials will work with the companies to detect fraud and coordinate efforts with providers, the HHS Office of Inspector General, and the FBI and other agencies (CQ HealthBeat, 10/7).
Some experts say "rampant abuses are inevitable, in part because of the benefit's complexity, but also because" private companies will administer the benefit, the Inquirer reports.
"Because the program has so many different plans, there's going to be millions of transactions and they're not going to be centralized in any meaningful or auditable way," Alex Sugerman-Brozan, director of the Prescription Access Litigation Project, said. He added, "That means some of these abuses may be hard to detect at least until they've been going on for several years" (Philadelphia Inquirer, 10/10).