Fraud found in Medicare drug program

Associated Press / February 12, 2011

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MIAMI — Crooks are taking advantage of lax oversight in Medicare’s Part D prescription drug program to obtain highly addictive drugs including oxycodone, Ritalin, and methadone, according to results of a federal probe.

The report by an independent inspector said Medicare can’t verify all the prescriptions it pays for, leaving the system open to exploitation by criminals using fake medical ID numbers and the identities of dead doctors.

The Centers for Medicare and Medicaid Services, which administer the federally funded health insurance program, isn’t adequately confirming that prescriptions are written by physicians, according to the investigation by the Office of the Inspector General at the Department of Health and Human Services.

Pharmacies and other Medicare contractors are supposed to enter a number that identifies prescribers. But in many cases, that information is being left blank or assigned a dummy number, last week’s report found. The missing information doesn’t always indicate fraud and could include clerical errors, but without prescriber identifiers, it’s hard for investigators to determine.

The report showed the agency paid $20.6 million for 228,000 prescriptions for so-called schedule II drugs with invalid prescriber IDs in 2007. The agency paid for about $1.6 billion worth of schedule II drugs during that same time period.

Investigators said the prescriptions with invalid IDs represented a small portion, but are alarming because schedule II drugs include heavy-duty painkillers and stimulants that are frequently trafficked.

Critics say pharmacies are getting around safeguards in the system, making it nearly impossible for federal health officials to track whether a licensed doctor prescribed the drug and in what quantities.

“It’s similar to placing a combination lock on a gate to protect what’s inside but then allowing any combination to open the gate,’’ said Robert Vito, a regional inspector general for the Department of Health and Human Services, during testimony before Congress last year.

Investigators recommended that contractors not be paid for Schedule II prescriptions that have an invalid doctor ID number, but Medicare officials worried stricter oversight could hamper legitimate patients’ access to medications.

The agency later agreed to validate all provider numbers and this month will tell contractors they will be required to use a Drug Enforcement Administration number or other valid prescriber identifier, spokesman Peter Ashkenaz said.

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