National review of Medicaid opioid prescribing not yet feasible

The Office of Inspector General (OIG) has determined that limitations of the national Medicaid claims database, the Transformed Medicaid Statistical Information System (T-MSIS), makes a national review of opioid prescribing in Medicaid unfeasible. The system cannot yet identify all at-risk beneficiaries and providers, the OIG reported (OIG Report, No. OEI-05-18-00480, August 2019).

The OIG assessed the completeness of variables necessary to identify beneficiaries at risk of opioid misuse or overdose and the National Provider Identifiers (NPIs) of providers that ordered and dispensed opioids. According to the report, states were missing data necessary for a national review. Some states did not require NPI to be collected. Others included NPI in their data but incorrectly submitted the data or were unable to transmit the data to T-MSIS because of outdated systems. Without a provider NPI, it is not possible to identify all providers who may be overprescribing opioids and take appropriate action, or to identify providers for investigations of fraud, waste, or abuse, the OIG found.

Identification of beneficiaries can be impeded because a Medicaid beneficiary can have multiple IDs within a state or across states. If a beneficiary does have multiple IDs, prescriptions dispensed to the IDs would appear to be for multiple persons rather than one person. The OIG noted in the report that without a unique beneficiary ID, it is not possible to identify all at-risk beneficiaries in need of opioid-related treatment and conduct proper monitoring of services to protect beneficiaries from inadequate coordinated care.

States also have failed to report diagnoses codes for all services despite being required to do so. Without a diagnosis code, it is not possible to exclude all patients with cancer diagnoses for whom higher doses of opioids may be appropriate or to identify patients’ medical conditions to determine medical necessity for services.

The OIG noted in the report that in August 2018, CMS that all states were submitting T-MSIS data and that CMS was prioritizing T-MSIS data quality. According to the OIG, CMS indicated it would have research files available in 2019. CMS currently has been working with states to improve the quality of data submissions.

Recommendations

The OIG recommended that CMS strive to ensure that individual beneficiaries can be identified at a national level using T-MSIS. CMS should address instances in which a single beneficiary has more than one Medicaid ID within a state. CMS also should prioritize state reporting of prescriber NPIs and issue guidance to clarify the requirements for diagnosis codes.

Highlight on Virginia: Medicaid agency fails to collect $2.9M in drug rebates

For a covered outpatient drug to be eligible for federal reimbursement under the Medicaid program’s drug rebate requirements, manufacturers must pay rebates to the states. States bill the manufacturers for the rebates to reduce the cost of the drugs to the program. Previous HHS Office of Inspector General (OIG) reviews found that states did not always bill and collect all rebates due for drugs administered by physicians to enrollees of Medicaid managed-care organizations (MCOs).

An OIG review of Virginia’s Department of Medical Assistance Services, Division of Health Care Services (Virginia), from January through December 2013, found that Virginia did not bill manufacturers for some rebates for physician-administered drugs dispensed to enrollees of Medicaid MCOs. As a result, it failed to collect an estimated $2.9 million (federal share) in rebates.

Virginia uses a contractor to manage its drug rebate program. According to the OIG audit, in calendar year 2013, Virginia paid MCOs $2,411,629,093 ($1,238,462,930 federal share), which included expenditures for physician-administered drugs.

The OIG found that Virginia properly billed manufacturers for rebates for drugs associated with the National Drug Codes (NDCs) in its audit sample. However, Virginia did not have valid NDCs for other drug utilization data submitted by MCOs for physician-administered drugs, and it did not bill manufacturers for rebates for these drugs. Virginia estimated average rebates per claim billed to manufacturers, and the OIG determined these estimates to be reasonable. The OIG applied the estimates and determined that Virginia did not bill rebates of $5,831,528 ($2,915,764 federal share) to manufacturers for physician-administered drug utilization without valid NDCs.

The OIG concluded that Virginia did not bill manufacturers for rebates for these drugs because the MCOs submitted utilization data to Virginia with a blank NDC field or an invalid NDC. Although Virginia required MCOs to submit valid NDCs for all physician-administered drug utilization, Virginia did not implement edits in its Medicaid Management Information System to ensure that MCOs submitted valid NDCs. As a result, Virginia did not obtain rebates for these drugs.

The OIG recommended that Virginia: (1) work with CMS to resolve the drug utilization data without valid NDCs by determining the correct NDCs, billing manufacturers for the estimated $5,831,528 ($2,915,764 federal share) in rebates, and refunding the Federal share of rebates collected; (2) implement Medicaid Management Information System edits to verify that NDCs are present and valid in all drug utilization data; and (3) ensure that MCOs submit drug utilization data containing NDCs for all physician-administered drugs.

Virginia concurred with the OIG’s findings and plans to take corrective actions.