Office of Inspector General Finds $40 Million by CMS With Less than Effective Drugs Prescribed–Medicare Part D Data Search

There were a large number rejected but there was also a large number that slipped through. Now when it comes to Medicare Part D, as we all know by now this is administered by insurance companies and their data so in essence, this is due to the lack of full data by those administering the plans and updating their algorithms to reject claims on “less than effective” drugs as the FDA classifies.

I f a drug is not included on the list, then the mathematical formulas used to automate the screening process can’t find them, so we are back to data, data and more data here along with those algorithms that are supposed to pin point these items. This is a “contractor” issue it sounds like here on the Part D portions as it is no secret out there that this is the part of the deal where insurers provide HMO type services to seniors.

The less than effective drugs are mostly old ones that were in use before the FDA was around and have no official FDA status but are still used. The companies can request a hearing with the FDA to gain approval but many don’t seem to want to do that as most are pretty much inexpensive items and it may not be worth their time and money to do so, and then there’s always the option of not gaining approval, even though the drug has been out there for years. We saw some of that in the news lately with the FDA threatening to remove one of those drugs and changing their mind later as it is still used frequently and is affordable.

So when all this boils down here, is this a huge crime or big deal, not really and if those drugs were not useful, doctors would not be prescribing them as again, they are affordable compared to some of the newer drugs that are out that may treat the same symptoms, but that are not affordable for many. Coming back around here, the health insurance companies are probably happy to see them being used as they save money, so this study just kind of opens up a can of worms with utilization of data overall. BD

The Centers for Medicare and Medicaid Services (CMS) is in hot water over illegal Medicare Part D payments. The Office of the Inspector General (OIG) found that the agency reimbursed plan sponsors $43.3 million for prescription drugs on the market that FDA classifies as less than effective. The OIG report covered calendar years 2006 and 2007 and a gross Part D drug expenditure of $115 billion.

"Less-than-effective drugs lack substantial evidence of effectiveness for all intended purposes," the OIG report said. "Although use of less-than-effective drugs may not cause direct physical harm to Part D beneficiaries, reliance on these drugs could be detrimental when they are used instead of drugs whose effectiveness has been verified ... Part D should not have covered these drugs."

OIG explained that CMS did identify and reject the vast majority of claims for less-than-effective products, some 5.3 million claims in all. But $43.3 million slipped through the system.

OIG found that CMS used an incomplete list of less-than-effective drugs to screen claims. CMS relies primarily on First DataBank's National Drug File Data File Plus and Medi-Span's Master Drug Data Base.

OIG uncovers $40 million in illegal CMS payments for Medicare Part D - - Drug Topics