New reports: Home infusion drugs, Medicaid overpayments

Friday, February 22, 2013

WASHINGTON – The Office of Inspector General (OIG) recommends in a new study that CMS change the way it pays for home infusion drugs.

One of the options laid out by the OIG: Include Part B home infusion drugs in the next round of competitive bidding. While external infusion pumps and supplies were included in the Round 1 re-compete (but not Round 1 or Round 2), CMS has not included drugs at all. CMS concurred with this recommendation.

The second option: Seek a legislative change requiring home infusion drugs to be paid using average sales prices (ASPs), instead of average wholesale prices (AWPs). The OIG found that between 2005 and 2011, home infusion drugs based on AWPs exceeded their ASPs by 54% to 122% annually. Medicare spending would have been reduced by 44%—or $334 million—during this time period had payment amounts been based on ASPs. CMS partially concurred with this recommendation.

The OIG conducted the study because, while Medicare pays 106% of the ASP for most drugs covered under Part B, it pays 95% of the AWP for home infusion drugs.

OIG to CMS: Millions in overpayments remain uncollected

WASHINGTON – The Office of Inspector General (OIG) recommends in a new report that CMS collect the more than $225.6 million in Medicaid overpayments that is due the federal government.

As of December 2012, CMS reported collecting more than $987 million of the roughly $1.2 trillion dollars in Medicaid overpayments from audit reports covered by the OIG’s review. CMS failed to collect the remaining $225,603,567 in overpayments because it had not always proceeded with the collection process in a timely manner, the OIG stated in the report.

Additionally, CMS could not document that $7.2 million it reported as collected had been collected because it did not maintain adequate supporting documentation, the OIG stated.

Other recommendations for CMS: Review and address delays in resolving OIG audit recommendations; support adequate documentation for collection of overpayments; and educate the states about their responsibility to report overpayments.