Medicare Will Target Rx Fraud in 2006

Ken Rankin
Published Online: Thursday, September 1, 2005

Fearing an upsurge in pharmacy reimbursement fraud when the Medicare Part D prescription drug program takes effect next year, Medicare officials have announced the creation of several new operating units. The aim of these units will be "to identify problem areas through trend analysis of claims data, and to oversee potential fraud areas in the Discount Drug Card and Prescription Drug programs."

Testifying at hearings of the Senate Homeland Security Subcommittee, Centers for Medicare and Medicaid Services (CMS) Financial Management Director Tim Hill told Congress that the newly created divisions are among "several specific actions [that] have been taken by CMS to ensure that federal dollars are being properly spent and fraudulent billings are stopped when they are detected."

Part of the crackdown will involve the establishment of a new CMS satellite office in Los Angeles to help "curtail fraudulent spending in high-risk areas," Hill said.

In addition, the CMS official served notice that pharmacies that have been involved in Medicaid billing abuses may be flagged for special scrutiny under the new Medicare drug program. "For the first time, Medicare claims and Medicaid claims are being jointly data-mined to identify fraud and abuse," Hill explained. "In many cases, a small number of crooked providers are exploiting both programs."

Mr. Rankin is a freelance medical writer.

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