Medicare Payment Error: Millions Inappropriately Spent on Prisoner Medication

A new government report has revealed that lax oversight in the Medicare program has led to $11.7 million dollars being paid to purchase prescription drugs for prisoners. The author of the report, Department of Health and Human Services’ Office of Inspector General (OIG), stated that prisoners usually do not get federal health care benefits like Medicare. The watchdog group also added that prisoners are definitely not eligible to get any sort of benefits through the Medicare Part D program. However, as the recently made public paper shows, millions were paid by the Part D program because there were no internal controls in place to prevent the problem. The OIG estimates that the millions in payments were made to sponsors or private insurers after they sent in prescription drug event (PDE) records. These payments did not fall under CMS guidelines.

The latest report is another shocking revelation by the OIG which previously also detailed in another study how $33.6 million was paid for treatment of prisoners even though it was against regulation.

The OIG goes on to say that, “[Centers for Medicare and Medicaid Services] inappropriately accepted PDE records submitted by sponsors for prescription drugs provided to incarcerated beneficiaries and used those records to make its final payment determinations.”

The watchdog group also claims that, “Specifically, for 49 of the 100 beneficiaries that we sampled, CMS accepted 1,298 PDE records submitted by sponsors for prescription drugs provided to incarcerated beneficiaries. The gross drug costs associated with these 1,298 accepted PDE records totaled $325,903.”

The OIG went ahead and offered up three solutions by asking that more robust controls be implemented to prevent such payments, tracking down the 49 improper payments and finally going back and resolving all previous unallowable payments made to prisons.


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