Rx DRUG COSTS I: HHS Audit Finds Abuse of Indian Program

      The Indian Health Service will review all prescription drug contracts with Indian tribes after an HHS audit found the Mashantucket Pequot tribe in Connecticut may have distributed $5.8 million worth of discounted prescription drugs to non-Indian casino employees, an "abuse" of a government health program. The AP/San Francisco Examiner reports that the audit found 82% of the drugs dispensed by the tribe's pharmacy in 1998 and 1999 went to "ineligible patients." The Mashantucket tribe, which runs the "world's largest casino," employs about 12,000 people in its casino, hotels, restaurants and museums. About 22,000 tribe members, employees and dependents are covered under the tribe's prescription drug plan, but most of those people are "non-Indians" according to auditors. The Indian Health Service said it will instruct the tribe to stop including non-Indians in its plan. Indian tribes are able to receive "deeply discounted rates" under the Veterans Health Care Act of 1992. The act allows the Public Health Service, along with the Pentagon, Coast Guard and Veterans Affairs Department, to buy medications at more than half off the regular price from suppliers. As a unit of the Public Health Service, the Indian Health Service extends the discount to tribes that have "self-determination contracts" with the federal government. Tribes, in turn, may pass the savings to non-Indian employees only "if there are no reasonable alternative health services available." Arthur Henick, a Mashantucket tribal spokesperson, said that the tribe may appeal the IHS' instructions to stop the program and that it does not plan on cutting back the program, which provides drug coverage at no cost to employees. "The tribe has been able to provide one of the best health plans in the region for its employees. We're going to continue to do anything we can for our employees, whom we consider part of the tribe for purposes of health care," Henick said.

Benefits at Risk
      Health officials fear that if non-Indians benefit from the Mashantucket's drug policy, it "could jeopardize" the discount for poorer tribes that rely on the reduced rates. HHS Inspector General June Brown said in a memo, "Evidence of program abuse could prompt Congress to reconsider the future of discounted drug programs, which would ultimately affect the millions of federal beneficiaries who now depend upon them for their health care." While the inspector's report focused on the Mashantuckets, the "alleged abuse" may include other tribes, including 16 tribes that contract with the Mashantuckets for "mail order pharmaceutical services" (McIntire, AP/San Francisco Examiner, 10/10).