OIG releases audit of AMPs and ASPs
Pharma Compliance Alert, January 2, 2008
The OIG identified 22 drug codes with average sales prices (ASP) that exceeded the average manufacturing prices (AMP) by at least 5% in the second quarter of 2007. Sixteen of the 22 drugs also met the price threshold in at least one previous OIG audit.
Under the Social Security Act, the OIG must notify the Secretary of Health and Human Services if a particular drug's ASP exceeds its AMP by 5% or more. Once that threshold is met, the Secretary can disregard the ASP for that drug and substitute the payment amount for the drug code with the lesser of the widely available market price for the drug (if any) or 103%of the AMP.
The OIG estimated Medicare would save $8 million for the fourth quarter of 2007 if the drug prices were calculated at 103% of AMP.
Click here to read the OIG's audit report.
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