New Jersey Claimed Unallowable Federal Reimbursement for Some Medicaid Physician-Administered Drugs

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Date Issued

Thursday, May 9, 2019

Submitting OIG

Department of Health & Human Services OIG

Other Participating OIGs

Department of Health & Human Services OIG

Agencies Reviewed/Investigated

Department of Health & Human Services

Report Number

A-02-16-01012

Report Description

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 for the drugs. However, a prior OIG review found that States did not always invoice and collect all rebates due for drugs administered by physicians.Our objective was to determine whether New Jersey complied with Federal Medicaid requirements for invoicing manufacturers for rebates for physician-administered drugs.

Report Type

Audit

Agency Wide

Yes

Number of Recommendations

Questioned Costs

$8,139,939

Additional Details

https://oig.hhs.gov/oas/reports/region2/21601012.asp

Open Recommendations

This report has 7 open recommendations.

Recommendation Number	Significant Recommendation	Recommended Questioned Costs	Recommended Funds for Better Use
266712	No	$0	$0
Work with CMS to determine the unallowable portion of $7,889 (Federal share) for other claims for covered outpatient physician-administered drugs that were submitted without NDCs and that may have been ineligible for Federal reimbursement and refund that amount,
266713	No	$0	$0
Work with CMS to determine whether the remaining $1,109,110 (Federal share) of other physician-administered drug claims could have been invoiced to the manufacturers to receive rebates and, if so, upon receipt of the rebates, refund the Federal share of the manufacturers’ rebates for those claims.
266716	No	$0	$0
Strengthen its internal controls to ensure that all physician-administered drugs eligible for rebates are invoiced.
266714	No	$0	$0
Work with CMS to determine and refund the unallowable portion of Federal reimbursement for physician-administered drugs that were not invoiced for rebates after December 31, 2016;
266715	No	$0	$0
Develop and implement formal written policies and procedures for its drug rebate program.
266710	No	$7,578,002	$0
Refund to the Federal Government $7,578,002 (Federal share) for claims for single-source physician-administered drugs that were ineligible for Federal reimbursement;
266711	No	$561,937	$0
Refund to the Federal Government $561,937 (Federal share) for claims for top-20 multiple-source physician-administered drugs that were ineligible for Federal reimbursement;