Detroit one of worst for Medicare drug fraud, feds say

Melissa Nann Burke
Detroit News Washington Bureau

Washington — Detroit is among the top four cities for pharmacies that had questionable billing practices in Medicare’s prescription drug program last year, according to an analysis by a government watchdog.

The Health & Human Services Department’s Inspector General found 1,432 pharmacies nationwide with suspicious billings, including hundreds that billed “extremely high” numbers of prescriptions per Medicare patient and others billing for nearly three times the national average of commonly abused narcotics in 2014.

The pharmacies tended to be independently owned and most prevalent in the Detroit, New York, Miami and Los Angeles metro areas, according to the report.

In the case of one Detroit-area pharmacy, 58 percent of the prescriptions it billed to Medicare’s program were for commonly abused opioids, compared with the nationwide average of 6 percent. The pharmacy billed opiate prescriptions for 93 percent of the Medicare patients it served last year.

“That 93 percent is absolutely shocking,” said Dr. Amy Bohnert, a psychiatry professor at the University of Michigan Medical School who studies opioid prescribing patterns and overdose prevention.

“This is definitely concerning data when you think about the implications: These are potentially lethal medications that are, through these routes, getting out to the communities in large numbers.”

Prescription painkillers such as hydrocodone (Vicodin), oxycodone (OxyContin), morphine and fentanyl are euphoria-enducing and highly addictive, affecting an estimated 2.1 million people in U.S. with substance abuse disorders, according to 2012 figures from the National Institute on Drug Abuse.

Pharmacies with high percentages of prescriptions for narcotics raise flags about potential billing for extra drugs that are never dispensed and diverted for resale, or otherwise used inappropriately, according to the report.

“Although some of this questionable billing may be legitimate, we firmly believe that all these pharmacies warrant further scrutiny,” said Miriam Anderson, a team leader in the Office of the Inspector General who worked on the study.

“We will take the next steps on each of these pharmacies, either by conducting an investigation, referring it to another law enforcement agency, or sharing the information with the Centers for Medicare & Medicaid Services, so they can follow up.”

The report does not identify pharmacies, in part because some of them will be flagged for potential criminal investigation, officials said.

The study follows a nationwide law enforcement sweep last week that netted 16 people in greater Detroit, which ranks as the nation’s second-worst U.S. metro area for such fraud. Authorities charged six Michigan physicians, a social worker, a pharmacist and two physical therapists with more than $122 million in fraud and kickback schemes.

In the Eastern District of Michigan, charges have been filed against 381 individuals totaling $881 million in false billings since the Department of Justice began targeting the region in 2009.

As the diversion of narcotic pain medications grows more common, officials are concerned about public safety. Gov. Rick Snyder recently created a task force to focus on the prescription drug and opioid problem in Michigan.

The state’s rate of opiate overdose deaths, 17.6 deaths per 100,000, exceeds the national average of 12.8, according to federal data.

The inspector general report also raised concerns about 216 pharmacies nationwide that had relatively high numbers of patients with four or more prescribers, suggesting “doctor shopping,” or visiting several physicians for multiple prescriptions of highly addictive drugs.

Another 300 pharmacies billed on average for more than 12 different types of drugs per Medicare patient in 2014. A Miami-area pharmacy billed for an average of 23 different drugs per patient, billing Medicare for nearly $2 million total for drugs for 143 patients.

Medicare spending overall for commonly abused pain meds has grown faster than spending for all Medicare prescription drug spending since 2006. Thirty-five percent of Medicare prescription drug beneficiaries in Michigan received a commonly abused opioid last year.

A spokesman for the Centers for Medicare & Medicaid Services said the agency has taken steps to address the IG’s recommendations and is making progress collecting and analyzing data to “proactively” identify potential fraud.

Also, the agency last week said it would begin exercising its authority to stop payments to individuals and entities suspected of fraud.

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