Review of the Medicaid Drug Rebate Program State of New Hampshire As of June 30, 2002

EXECUTIVE SUMMARY:

This report presents the results of our audit of the Medicaid drug rebate program in the State of New Hampshire.  The objective of our audit was to evaluate whether the State agency had established adequate accountability and internal controls over the Medicaid drug rebate program.  We found that procedures for reconciling and reporting the pending drug rebate amounts and corresponding ageing of these rebates on the Medicaid Quarterly Expenditure Report submitted to Centers for Medicare and Medicaid Services (CMS) were not established.  In addition, we determined that the State agency did not have procedures in place to monitor the collection of interest due from manufacturers.  We recommended that the State agency; (1) develop a pending drug rebate ageing schedule for use in the proper preparation of the CMS report, and (2) continue its efforts to develop procedures for the proper monitoring and collection of interest owed by manufacturers for overdue drug rebate amounts.  The State agency agreed with our recommendations and has developed corrective action plans to address the issues identified in our report.

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