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Audit (A-06-09-00093)

08-02-2011
Review of Arkansas Medicaid Prescription Drug Claims for the Quarter Ending December 31, 2008

Executive Summary

Based on our sample results, we estimated that for the quarter ended December 31, 2008, Arkansas reimbursed pharmacies $1.7 million for Medicaid outpatient drug claims that were not supported by pharmacy records. In addition, 127 prescriptions were not written on tamper-resistant pads as required by Federal statute, and the pharmacies did not document verification of those prescriptions with the prescribing practitioners in accordance with CMS guidance. We found 26 unsupported claims: 11 were unsupported because the drug or quantity dispensed was not authorized, 11 because the original prescription had expired, 2 because the pharmacies could not locate the prescriptions, and 2 because the prescriptions did not authorize refills.

The American Recovery and Reinvestment Act of 2009 provided fiscal relief to States to protect and maintain State Medicaid programs in a period of economic downturn. For the recession adjustment period (October 1, 2008, through December 31, 2010), the Recovery Act provided an estimated $87 billion in additional Medicaid funding based on temporary increases in States' Federal medical assistance percentages.

The Federal Government pays for covered outpatient drugs only when written on a tamper-resistant pad. (Prescriptions transmitted verbally, by fax, or e-prescription are exempt.) For prescriptions not meeting the tamper-resistant requirement, the Centers for Medicare & Medicaid Services requires pharmacists to request verification of the prescription from the prescribing practitioner or fill the prescription on an emergency basis and obtain documentation within 72 hours.

We recommended that the State (1) work with the pharmacies to determine the proper resolution for the 26 unsupported claims, (2) remind pharmacies of CMS guidance to verify prescriptions that do not comply with Federal tamper-resistance requirements, (3) remind physicians of the Federal tamper-resistance requirements for prescriptions, and (4) strengthen its review process to ensure that payments are made only for drugs that are supported by appropriate records. The State described actions it had taken and stated that all findings had been turned over to the State Program Integrity Unit for further action.

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