Deeper Than the Headlines: October 2017 Updates to the OIG Work Plan

The OIG has added some more items to their work plan for this month, October 2017. Some of these new items may interest you. Staying informed is a large part of maintaining an effective compliance program.

Specialty Drug Coverage and Reimbursement in Medicaid

The OIG reports that spending on specialty drugs is quickly rising for Medicaid. They also report that there is not a standard definition for what qualifies as a specialty drug. The OIG wants to take a look at the various definitions found throughout the various States’ Medicaid programs as some definitions include drugs that are expensive, difficult to handle/monitor/administer, or perhaps drugs that treat complex and rare conditions. This work plan item appears to be a summary review as OIG plans to look at many things in a broad way, such as States’ payment methodologies, how much States’ are paying overall for specialty drugs, strategies to manage States’ specialty drug costs, formularies, cost sharing, step therapy and prior authorization. The OIG expects to issue their findings in 2019.

Review of Medicare Payments for Bariatric Surgeries

Bariatric surgery is performed to treat morbid obesity and the often accompanying comorbid (i.e., co-existing) conditions. Medicare covers certain bariatric surgeries if the patient has:

1. a body mass index of 35 or higher
2. at least one comorbidity related to obesity AND
3. been previously unsuccessful with medical treatment for obesity

Medicare does not cover bariatric surgery for obesity alone. [For more on the Medicare coverage rules for bariatric surgery see CMS, Medicare National Coverage Determinations Manual, Pub. No. 100-03, chapter 1, part 2, § 100.1].

The OIG reports that the CERT program’s study of bariatric codes found “98 percent of improper payments lacked sufficient documentation to support the procedures.”

This OIG Work Plan item is designed to review supporting documentation to determine whether the bariatric services performed met the conditions for coverage and were supported in accordance with Federal requirements. OIG is expected to issue their findings in 2018.

Three other work plan items were added. However, two of them relate to the FDA (Drug Traceability Test and FDA Oversight of Risk Evaluation and Mitigation Strategies To Address Prescription Opioid Abuse) while the third relates to Secretary Price’s Use of Chartered Aircraft for Federal Travel.

These items can be viewed on the OIG web site.