Gain high value access and increase the profitability of your brands
A primary care physician who wrote Oxycodone prescriptions for patients who didn’t need them. An oncologist who treated patients with “misbranded” and unapproved drugs imported from outside the United States. An orthopedic surgeon who received kickbacks for sending patients for MRIs and CAT scans from a diagnostic testing facility. A clinic that fraudulently billed for millions in expensive drugs that were never bought, needed, or used.
These are just a few examples of offenses that could land a healthcare provider or entity on federal and/or state Exclusion Lists. These lists will be described in more detail in part 2 of this blog series, but briefly they contain doctors and entities that have been excluded from Medicare and/or Medicaid reimbursement for reasons that include healthcare fraud, failing to provide adequate patient care, and being convicted of a felony related to controlled substances.
Intuitively, it would seem obvious that any individual or entity on an Exclusion List should be ineligible to deliver and be reimbursed for patient care. In reality, however, these “bad actors” often continue to deliver care. In fact, an estimated 3% to 10% of healthcare expenditures are lost to fraud1. That translates into projected losses of $140 billion at the minimum in 2023, based on a National Health Expenditure projection of $4.67 trillion2.
The IQVIA Gross-to-Net team recently performed a data-driven analysis to get a sense of how pervasive this problem is. We did this by analyzing IQVIA Longitudinal Access and Adjudication Dataset (LAAD) pharmacy claims data from 2021–2022, with a goal of quantifying “bad actor” drug expenditures for paid claims across all disease areas and payment types.
Quantifying exposure at the macro level
To support this analysis, we combined public data sources to create a master file of “bad actor” lists and enhanced it using pharmacy rejection codes corresponding to exclusions. Public sources included data from OIG, System for Award Management, States, and CMS.
Our analysis revealed a staggering $893 million in estimated impact on drug expenditures over 2021–2022 from members on “bad actor” lists. Of that financial impact, 51% was contributed from Commercial plans, 33% from Medicare Part D, and 11% was through Medicaid. All told, 8.6 million claims were related to “bad actors”—representing about .1% of the $990 billion in total prescription drug expenditures analyzed. Our analysis also found that the top 20 drugs contributed 30% of this total spend.
In addition to the Exclusion Lists, we examined two other potential program integrity issues:
What’s YOUR exposure?
Are there any teams in your organization monitoring these lists? How are results being communicated? What type of actions are being taken?
Do you know if you are engaging with these providers? Does it fuel compliance risk for your company? Are you connecting the dots across all your data, including your rebate programs? Should you be thinking about this differently? Does it introduce significant compliance risks and potential costs?
You may discover that Exclusion List exposure is a problem you don’t know you have.
In two upcoming posts, we’ll take a closer look at the universe of Exclusion Lists, how lack of monitoring could be putting your business at risk, and how you can take a proactive, data-driven approach to solving this problem.
1. https://www.nhcaa.org/tools-insights/about-health-care-fraud/the-challenge-of-health-care-fraud/
2. https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsProjected
Part 2 will explore the universe of Exclusion Lists and why they can be challenging to monitor.
Gain high value access and increase the profitability of your brands
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