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OIG issues report on CMS safeguards to prevent and detect fraud

Pharma Compliance Alert, October 17, 2007

In fiscal year 2006, CMS relied mainly on complaints from beneficiaries, pharmacists, and plan staff to identify potential fraud and abuse in the Medicare Part D program. However, CMS failed to investigate all complaints promptly, according to an audit report issued by the OIG.

The report identifies six major safeguard areas created by CMS:

• A complaint process
• Data-monitoring activities
• Financial audits
• Monitoring prescription drug plans (PDP) sponsor compliance with contract requirements
• Oversight of PDP efforts to reduce fraud and abuse
• Education and guidance of stakeholders on fraud and abuse identification

CMS needs to further develop and apply these safeguards, according to the OIG. The report found enforcement was not effective in financial auditing, Part D marketing, and utilization management.

In order to protect the integrity of Medicare Part D, the OIG recommended CMS:

• Develop a comprehensive safeguard strategy for Medicare Part D PDPs with specific activities and target dates and ensure that all activities are progressing in a timely manner
• Ensure all fraud complaints receive proper attention
• Address legal concerns that may impede program integrity efforts

Click here to read the full report.

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