Medicare overpays for drugs while generic version is available
Healthcare Auditing Weekly, September 2, 2008
Medicare paid for drugs that had a cheaper generic version because of a time delay in calculating prices when the less expensive version came out, the OIG says.
Medicare paid double the average manufacturer’s sales prices for the cancer drug irinotecan after the generic version was cleared for sale Feb. 20, according the OIG’s report. The OIG estimated that if Medicare had based its payments on generic price, Medicare expenditures for this drug would have been reduced by $6.5 million in March 2008 alone.
The OIG is recommending CMS “explore options to expedite the process to ensure that Medicare payment amounts for drugs with newly available generic versions accurately reflect market prices.”
CMS agreed with the OIG’s findings and recommendations.
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