The Definitive Blog

Medicare Paid for Prescriptions for Deceased Beneficiaries

A report released by the Health and Human Services (HHS) office of Inspector General reveals that Medicare’s prescription drug program paid for costly medications even after patients were dead.

This mistake was due to a bureaucratic Medicare rule that allows prescriptions to be filled up to 32 days after a patient’s death.

Not only does this glitch not make common sense, but it violates the requirement for Medicare coverage, that drugs must be medically indicated.  Drugs for the deceased beneficiaries clearly are not medically indicated.

Medicare is currently reporting on a fix, with critics highly encouraging CMS to shorten or eliminate the 32 day window.

Investigators found this upon examining claims from 2012 for medications used to treat HIV and referenced them with death records.  They found that the program paid for drugs for 158 people after they were already dead.

The total cost to taxpayers was $292,381, averaging $1,850 for each beneficiary.

Most of the drugs were dispensed by retail pharmacies and sometimes multiple prescriptions were filled on behalf of a single dead person.

Additionally, investigators found HIV drugs dispensed for beneficiaries who had had no history of HIV in their Medicare record.
One such example was a 90-year old Boston man for whom Medicare dispensed a $1,200 Medicare HIV drug prescription 25 days after he died.

While the review only looked at HIV drugs, this finding can be worrisome for the potential financial implications for Part D of Medicare, an $85 billion a year prescription program.

Unfortunately, investigators weren’t able to figure out what exactly happened to medications obtained on behalf of the dead people.  It is speculated, however, that they may have gone into the underground drug market for prescription medicines.  This is assumption can be accredited to HIV drugs’ high cost which allows them to be targets for fraud.

Definitive Healthcare’s hospital database tracks outpatient procedure analytics by both provider and HCPCS code.  When searching for the short description of “HIV” Definitive Healthcare’s database brings results for 10,595 for Medicare payments and claims.

Definitive Healthcare’s claims via 2013 Medicare SAF 1/1/2013-12/31/2013.

November 3, 2014
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