Pharmacy Medicaid Audit Reform

Pharmacy Medicaid Audit Reform
SUPPORT
S. 1511/DeFrancisco
A7448/Schimminger - Assembly version is similar to the Senate version however it contains several additional components.

This legislation amends Public Health Law and creates Medicaid audit standards and procedures for pharmacy audits. Pharmacies have been subjected to intense audits by the Office of the Medicaid Inspector General and contractors employed by counties who are often paid on the basis on what they are able to identify as "overpayments." The bill establishes standards for auditors so that pharmacies are able to conduct daily routines without interference from over-zealous auditors. These provisions protect the public health and safety by ensuring that pharmacists can give full attention to the prescriptions being dispensed at the time the audit is being conducted.

The legislation is necessary in order to protect legitimate Medicaid pharmacy providers from unjust monetary penalties for issues related to claim filings that are administrative and clerical in nature and have been determined not to involve fraud. In too many cases, relatively minor technical errors or omissions have been turned into penalties in the thousands and even millions of dollars by the use of statistical projections. This bill would prohibit ‘extrapolations' in non-fraud cases and in so doing protect legitimate Medicaid providers from the financial penalties that now go far beyond what is reasonable and fair.

Legitimate pharmacy providers should not be forced out of business when they have dispensed and even delivered (at no charge) the appropriate medication ordered by an authorized prescriber to a Medicaid beneficiary who has received and consumed the medication. Legitimate pharmacy providers should not be forced to hire attorneys and spend thousands of dollars to protect their businesses from very substantial monetary penalties when they have not been accused of fraud, have not abused the Medicaid program, have not wasted taxpayer dollars. In fact, we question whether the Office of the Medicaid Inspector General is, in fact, wasting taxpayer dollars.

This legislation is fair and reasonable. It assures that pharmacy providers will be afforded appropriate protection under law when they are determined to be innocent of fraud and the willful intent to commit fraud. In the current climate, statutory reform in this area is not only necessary, but also urgent. Left unchecked, OMIG actions will serve to drive legitimate pharmacies out of the Medicaid program.

The Pharmacists Society of the State of New York has always been a good partner in the state's efforts to control fraud, waste and abuse in the Medicaid program. We have reported significant fraud when warranted. We do not, nor have we ever tolerated fraud of any kind in the profession. But we cannot in any way allow legitimate pharmacy owners to be mistreated and abused, and we are saddened that some have been intimidated into paying unjust penalties.