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Congressional panel digs into drug pricing

Healthcare Auditing Weekly, February 20, 2007

Federal prosecutors have a backlog of more than 150 cases of alleged pharmaceutical fraud, according to testimony before a Congressional panel last week.

The House Committee on Oversight and Government Reform, chaired by Henry Waxman (D-CA.), held the hearing to "examine whether there are fraudulent, abusive, or wasteful pharmaceutical pricing practices that affect federal health programs such as Medicaid, Medicare, and the Public Health Service '340B' program that should be the subject of additional congressional oversight."

Committee members heard testimony from OIG Chief Counsel Lewis Morris and Patrick J. O'Connell, chief of the Civil Medicaid Fraud Section in the Office Texas Attorney General's office, among others. Much of the testimony was an overview of successfully prosecuted pharmaceutical fraud settlements.

The panel also heard from the Government Accountability Office (GAO), which reported "oversight inadequacies, inaccurate prices, lack of price transparency, and the potential for abuse" in CMS' drug pricing oversight. The GAO suggested Congressional oversight, in areas including ensuring that "all appropriate transactions" are included in the average manufacturers' prices, best prices reported by manufacturers, and the extent to which federal agencies will monitor and detect fraud and abuse.

Waxman also requested information about Medicare Part D information. In a letter to the chief executives of 12 Medicare insurers, Waxman requested Part D pricing information, including profits and administrative costs associated with coverage.

You can read more about the hearing, including transcripts of testimonies and Waxman's letter to Medicare insurers, on the committee's Web site.

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