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OIG: Medicaid Drug Rebate Collections Uneven

John Commins, for HealthLeaders Media, June 28, 2011

While the majority (86 percent) of states responding to a federal audit claim to meet the legal requirements to collect on claims for certain physician-administered drugs, the results of the audit are decidedly mixed.

The audit, conducted by the Office of Inspector General, provides a mixed picture of states' efforts to collect Medicaid drug rebates from pharmaceutical companies. The Deficit Reduction Act (DRA) requires states to collect rebates on all claims for certain physician-administered drugs for Federal matching funds to be available.

Most states appear to have made significant improvements in the collection process over the last decade, but the quality of the reporting was so poor in some cases, that OIG said it "could not determine the financial impact of collecting rebates for physician-administered drugs because of incomplete and potentially inaccurate data provided by States."

Those are some of the findings in the audit – States' Collection of Medicare Rebates for Physician-Administered Drugs-- released this month by the Department of Health and Human Services Office of  Inspector General. 

The OIG audit tried to determine how many states were meeting federal requirements for the collection of physician-administered drugs in the first six months of June 2009; the dollar amount of what the states requested and what they collected from drug makers in those six months; and what issues prevented states from collecting rebates.