Medicare may be paying hospices double for drugs

Federal officials have warned that the Medicare program might be paying twice for some medications that are provided to hospice patients.

In 2009, Medicare Part D, the prescription drug benefit, paid hospices for common medicines and prescribed drugs to treat illnesses such as chronic obstructive pulmonary disease and amyotrophic lateral sclerosis. The drugs also would be covered under per diem payments to these facilities through the Part A hospital benefit, the Dept. of Health and Human Services Office of Inspector General said in a July report.

OIG identified 198,543 patients who were prescribed 677,022 drugs through Part D that year. Investigators said the drugs are covered under the per diem payments to hospice organizations, but pharmacies still received more than $36 million in Part D payments and patient co-pays for the drugs.

“We contacted the Part D sponsors for five plans and found that, during our audit period, they did not have procedures to identify prescription drugs that should have been covered under the per diem payments,” the report said.

The Centers for Medicare & Medicaid Services agreed with OIG’s recommendations to increase education regarding hospice coverage and require Part D plans to develop controls that prevent paying for drugs covered by the per diem. However, CMS said it would not increase its oversight activities to recoup potential overpayments.“We agree that it is possible Part D may have paid for drugs that were already covered under the per diem payments made to hospice organizations, but we would need conclusive evidence that such an issue exists before making payment adjustments,” acting CMS Administrator Marilyn Tavenner wrote in a May 3 memo responding to the report’s findings. “Despite developing and implementing an elaborate research methodology, OlG was not able to definitively determine that duplicate payments were made.”

Note: This item originally appeared at http://www.ama-assn.org/amednews/2012/07/16/gvbf0716.htm.