OIG sets sights on Part D fraud amid rise in drug spending

Part D fraud remains "a top area of concern" for the Office of Inspector General (OIG) following a 136 percent increase in Part D spending between 2006 and 2014, according to a new enforcement video released by the agency.

Assistant Inspector General for Investigations Tom O'Donnell (right) highlighted a recent case in which a New York doctor wrote prescriptions for HIV drugs to patients that were then sold to recruiters, redistributed on the black market, and often ended up back in the pharmacies that originally dispersed the drugs. In December, a Utah-based pharmaceutical wholesaler was charged with reselling HIV medications purchased of the black market to pharmacies at full price.

"That's kind of scary if someone actually had HIV and they needed to get their drugs, it didn't come directly from the manufacturer; it came from the black market," O'Donnell said in the video.

O'Donnell added that there are four major concerns surrounding Part D fraud: The impact on taxpayers, medical identity theft, the potential for patient harm and the social impact of opioid abuse. He noted that the historic fraud takedown in June, in which 44 of the 243 individuals arrested were charged with Part D fraud, included evaluators and auditors at the local, state and federal level, furthering the notion that fraud investigations are taking a more collaborative approach.

The OIG has continually pushed for more fraud controls for Medicare Part D by the Centers for Medicare & Medicaid Services (CMS), pointing to a spike in spending over the last decade. In July, members of the House Subcommittee on Oversight and Investigations grilled representatives of the OIG and CMS about the high volume of opioid prescribing and a lack of program oversight. Although Part D has a low improper payment rate, Part D sponsors are still not required to report fraud and abuse activity to CMS.

For more:
- watch the OIG video

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