CMS Initiatives to Fight Medicare Fraud

Tampa—For several years, the Centers for Medicare & Medicaid Services (CMS) has implemented numerous antifraud programs. They are intended to identify the pharmacies, patients, prescribers, health plans, manufacturers, pharmacy benefit managers, and wholesalers who are defrauding Medicare Part D.

Jon Juenger, assistant US attorney, Miami, Florida, said that the official definition of healthcare fraud is complex. However, he said it should not be too hard to identify. “Fraud is just lying to get money—it is that simple,” Mr. Juenger said during a session at the AMCP meeting.

The most common form of Medicare fraud is lying about a claim that gets filed, according to Mr. Juenger. He said it is easy to submit a false claim, but the federal government is becoming more diligent at fighting fraud and abuse.

For instance, the CMS Division of Plan Oversight and Accountability and its antifraud unit fights Medicare Advantage and prescription drug fraud and maintains the integrity of the Medicare Part C and Part D programs. There is also a Medicare Part D Overutilization Monitoring System, in which the CMS sends quarterly reports to plan sponsors identifying beneficiaries with potential overutilization issues with a particular emphasis on acetaminophen products and opioids. Based on prospective data analysis, the CMS made 60 referrals to law enforcement officials and investigated 182 potential fraud issues, according to James Scott, president, chief executive officer, Applied Policy.

Still, Mr. Scott said the efforts have not always been effective. He cited a report from the Office of the Inspector General (OIG) that found more than half of Medicare Part D plan sponsors did not report data on potential fraud and abuse between 2010 and 2012. Furthermore, of the sponsors reporting data, more than one-third did not identify any incidents of potential fraud or abuse during at least 1 of the years between 2010 and 2012. In addition, 28% of plan sponsors did not inquire and/or did not take any corrective actions in response to potential fraud and abuse, while the CMS did not perform quality assurance checks or use data to monitor or oversee Medicare Part D.

The OIG recommended that the CMS require plan sponsors to report potential fraud and abuse, provide specific guidelines on how to define and count the number of incidents of potential fraud and abuse, review data to understand why sponsors reported low or high number of incidents, and share data with all sponsors and law enforcement officials.

Mr. Scott also discussed pending antifraud legislation that would establish a safe pharmacy access program to allow plan sponsors to implement procedures to prevent fraud and abuse of controlled substances and requires electronic prescribing of certain controlled substances. Meanwhile, the Medicare Prescription Drug Anti-Fraud Act would require plan sponsors to report credible fraud allegations to the Department of Health & Human Services, which could then suspend payments to sponsors pending the investigations. Mr. Scott said the CMS did not define a “credible allegation,” but he mentioned it could include an employee or patient complaint, a report to the OIG’s fraud hotline, claims data mining, or patterns identified during audits.