Nationwide Rollup Report for Medicaid Drug Rebate Collections

In 2005, we issued a report to CMS on the results of audits of the Medicaid drug rebate programs in 49 States and the District of Columbia. This rollup report examined whether the States and the District of Columbia implemented our recommendations and established controls over collecting rebates on single-source drugs administered by physicians.

Our review found that 14 States and the District of Columbia implemented the recommendations from the previous audits. Of the 31 remaining States with previous audit recommendations, 27 implemented at least 1 recommendation, and 4 States did not fully implement any of the recommendations. We identified new weaknesses in four States.

Forty-two States established controls over collecting rebates for single-source drugs administered by physicians as required by the Deficit Reduction Act of 2005. The six remaining States and the District of Columbia did not establish controls over collecting these rebates. States lacked adequate assurance that all drug rebates due the States were properly recorded and/or collected. Additionally, CMS did not have reliable drug rebate billing and collection information to properly monitor the program.

We recommended that CMS (1) continue to emphasize the requirement that States submit accurate and reliable information on the Medicaid Drug Rebate Schedule (Form CMS 64.9R), (2) continue to emphasize to States their need to place a priority on their billing and collecting of drug rebates, and (3) emphasize the States' requirement to collect rebates for single-source drugs administered by physicians. CMS agreed with our recommendations.