Hawaii Did Not Bill Manufacturers for Some Rebates for Drugs Dispensed to Enrollees of Medicaid Managed-Care Organizations

Hawaii did not fully comply with Federal Medicaid requirements for billing manufacturers for rebates for drugs dispensed to enrollees of Medicaid managed-care organizations. Hawaii properly billed manufacturers for some rebates for pharmacy and physician-administered drugs. However, it did not bill for and collect from manufacturers rebates of $18.8 million ($9.7 million Federal share). For drugs that were eligible for rebates, Hawaii did not bill for rebates of $8 million (Federal share) for pharmacy drugs and $1.6 million (Federal share) for single-source and top-20 multiple-source physician-administered drugs. For drugs that may have been eligible for rebates, Hawaii did not bill for rebates of $57,783 (Federal share) for non-top-20 multiple-source physician-administered drugs with National Drug Codes. In addition, Hawaii did not bill for rebates for 122,436 claim lines for other physician-administered drugs. Hawaii did not provide us sufficient drug utilization data to determine whether these drugs were eligible for rebates and the amount of any rebates that may have been due.