Follow-Up Audit of the Medicaid Drug Rebate Program in Colorado

Executive Summary

Colorado's State agency partially corrected some of the weaknesses reported in our prior audit. The State agency reported $1.8 million (Federal share) in drug rebates for gamily planning ($1 million) and a State-funded program ($766,000) based on estimated-rather than actual-expenditures, and did not report $45,000 ($22,000 Federal share) in interest. Additionally, the State agency had $862,000 in outstanding disputes that were over 3 years past due for resolution with manufacturers, it did not report all necessary data relating to its Medicaid drug rebate program, and it had not collected rebates for single source drugs administered by physicians since June 30, 2007. The State agency concurred with all of our recommendations and discussed the implementation and corrective actions proposed.