Bills To Speed Medicare Drug Plan Reimbursements To Pharmacies Could Limit Fraud Detection, Increase Costs, PBM Group Says

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Pharmacy / Pharmacist
Article Date: 14 Apr 2008 - 12:00 PST

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Legislation (HR 1474, S 1954) that would reduce the time in which Medicare prescription drug plans must reimburse pharmacies to 14 days for electronic claims and 30 days for paper claims would limit the ability to detect fraud, according to a survey and a print advertising campaign released on Thursday by the Pharmaceutical Care Management Association, which represents pharmacy benefit managers, CQ HealthBeat reports.

For the survey, PCMA interviewed dozens of industry experts responsible for pharmacy audits and fraud investigations and found that fraud schemes have become more complicated and more difficult to detect. Experts maintain that waste, fraud and abuse in pharmacy claims accounts for 1% of medication costs, which could translate to hundreds of millions of dollars in unnecessary costs for the Medicare prescription drug benefit, PCMA said.

According to the PCMA ad campaign, the legislation would cost Medicare $3.3 billion to $7.8 billion over the next 10 years. Mark Merritt, president and CEO of PCMA, in a statement said that the legislation would "increase costs and make fighting fraud, waste and abuse more difficult."

Charlie Sewell -- senior vice president for government affairs at the National Community Pharmacists Association, which represents community pharmacies and supports the legislation -- said that the survey and the ad campaign were "dead wrong as usual." In November 2007, Sewell said that the legislation would not increase costs for the Medicare prescription drug benefit and that PBMs have withheld reimbursements from pharmacies and collected interest on the funds (Carey, CQ HealthBeat, 4/10).

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