NCPA - National Center for Policy Analysis

Reducing Medicaid Fraud via Lock-In Programs and Prohibiting Automatic Prescription Refills

September 8, 2015

According to Medicaid payment data from 2011, Arizona, Florida, New Jersey, and Michigan showed signs of potentially fraudulent or abusive prescription activities.

  • Specifically, more than 16,000 Medicaid beneficiaries might have visited at least five doctors to obtain prescriptions, costing taxpayers more than $33 million.
  • Another 700 beneficiaries, at an expense of $1.6 million tax dollars, are estimated to have received more than one year's worth of the same drug in 2011.
  • Other possible sources of Medicaid fraud include individuals receiving prescriptions in multiple states, receiving prescriptions while incarcerated, receiving prescriptions after death and automatic prescription refills without patient action, which may lead to drug stockpiling and wasteful spending.

In response to these findings, the Government Accountability Office (GAO) proposed solutions to combat fraud such as prescription lock-in programs. Such programs would identify Medicaid abusers and limit them to receiving prescriptions from one prescriber, one pharmacy or both.  Another considered solution is automatic prescription refill prohibitions. These solutions aim to reduce drug stockpiling, which in turn would reduce the likelihood of illicit activity involving drugs and would reduce state expenses such as mailing medications to recipients.

Some states, such as Florida and Arizona, have already implemented the automatic refill ban, and the GAO has encouraged the Centers for Medicare & Medicaid Services (CMS) to require states to report information about drug-operation review regulations, an encouragement the CMS agrees with and will consider implementing.

Source: "Additional Reporting May Help CMS Oversee Prescription-Drug Fraud Controls," Government Accountability Office, August 10, 2015

Sponsored Links: Superstore FlyerMetro FlyerSobeys Flyer


Browse more articles on Health Issues