Texas Budget Source

Curt W. Olson
COlson@TexasBudgetSource.com

Law enforcement officials and investigators of safety net programs pursue tens of millions of dollars — even hundreds of millions of dollars — in Medicaid fraud each year in Texas.

Texas Attorney General Greg Abbott has been a busy man in recent weeks getting settlements from pharmaceutical companies for Medicaid fraud — and he’s not done.

Medicaid fraud is the over-reimbursement of Medicaid dollars for the federal and state health care program for the poor.

Health and Human Services Commission Inspector General Douglas Wilson also remains vigilant in finding waste, fraud, or abuse in safety net programs.

Consider over the past six weeks, Abbott recovered nearly $36 million to the state’s general revenue fund from Medicaid fraud.

The AG’s recent moves generated the following for state coffers:

• $11.3 million stemming from Medicaid fraud involving Watson/Schein Pharmaceuticals Inc. of New Jersey. The other companies in the case included Alpharma USPD/Purepac Inc., Barr Pharmaceuticals Inc., and Par Pharmaceutical Inc., all N.J.-based. All of these Medicaid fraud cases have been resolved, with the exception of Alpharma/Purepac.

• $24.4 million from a lawsuit settled in late August over fraudulent pharmacy prices involving Par Pharmaceutical Inc. of New Jersey and three other drug manufacturers in 2008.

The companies were accused of defrauding the Medicaid program by improperly reporting drug prices.

Texas was joined in the second case by Florida, Alaska, South Carolina, and Kentucky also seeking money when their Medicaid programs over-reimbursed pharmacies for Par. The settlement for the 5 states was for $154 million, which includes attorney fees.

These are two of 16 cases resolved in about 15 months. The amount is more than $95 million, including attorney fees.

The total recovered from these 16 cases is more than $237 million, which includes recovery for fraud in Texas. However, more than $121 million has been owed the federal government because Medicaid is mainly a federal program.

Meanwhile, Wilson said he will be watching the drug-benefits provider when Medicaid Managed Care starts in the coming months in the Rio Grande Valley. Lawmakers approved this to control health care costs in the Valley and save hundreds of millions of dollars.

Wilson produces an annual report with costs avoided for providers and recipients and costs recovered for providers or recipients. This spans all HHSC programs paid via Medicaid and state sources.

In 2010, the OIG had a total in those four categories of $834.8 million. Through three-quarters of 2011, the amount was $648.2 million. The OIG has recovered or avoided costs at least $653.6 million a year in these categories since 2004.

Check out this link — https://oig.hhsc.state.tx.us/Reports/OIG%20Annual%20Report%20FY2010%20-%20Final%20Approved.pdf — to see the full report and what was done over all agency programs.