NCPA provides insight on addressing waste, fraud and abuse in health care to House subcommittee

ALEXANDRIA, Va. — The National Community Pharmacists Association on Wednesday submitted a statement for the record to the U.S. House Energy and Commerce Health Subcommittee for its hearing on “Fostering Innovation to Fight Waste, Fraud and Abuse in Health Care.” NCPA’s statement called for pharmacy audits to focus on true waste, fraud and abuse as opposed to clerical errors, and for policymakers to examine mail-order waste in federal health programs. 

“The fiscal integrity of government programs requires finding effective and efficient ways of rooting out fraud, waste and abuse,” stated NCPA CEO Douglas Hoey. “When the right patient receives the right medication as prescribed, at the right time and for the correct price, that shouldn’t be a punishable offense. Pharmacy audits should focus on finding real malfeasance. Instead, clerical errors are being utilized to pad the middleman’s profits on the backs of healthcare providers," he said. "In addition, policymakers must achieve greater oversight of waste generated by mail-order autoshipping as well as transparency to better manage and evaluate contracts with pharmacy benefit managers.”

NCPA’s statement noted that nearly half (43.6%) of claims deemed to be overpayments were reversed in favor of providers upon appeal.

And Medicare acknowledges egregious pharmacy auditing, noting in the 2014 draft Call Letter that, “[t]he increasing incidence of these adjustments for ‘routine clerical errors’ rather than incorrect payment amounts (financial errors) may be related to the incentives in contingency reimbursement arrangements with claim audit vendors.” They added, “[w]e are concerned that the growing practice of post-audit total claim recoupments from pharmacies is distorting Part D payment, as well as compromising Part D data integrity and impairing our ability to oversee the program.”

NCPA added that waste through mail order auto-shipping is rampant. Medicare has received complaints from beneficiaries about auto-shipping of excessive or unneeded medical products and has documented such incidences. Recently, in front of the House Small Business Committee, a Medicare official testified that from a selected group of beneficiaries that ceased ordering DTS in 2011, 60% of these beneficiaries had more than 10 months’ worth of diabetes testing supplies on hand, likely as a result of mail-order autoshipping. In addition, NCPA strongly encourages an audit of the TRICARE mail-order program, given the many examples of mail-order waste observed by NCPA members.