Lately many of my clients have been plagued with extremely aggressive, to the point of rude visits by persons called OIG inspectors doing a Medicaid audit. However, these audits are unlike any audit you have ever had before. The OIG inspectors who are not pharmacists and are not educated in pharmacy medicine, science or statistics come into the pharmacy and demand to be admitted to the dispensing area.
In my opinion, they have no authority to enter your pharmacy but in fact, are prohibited by law from doing so. Under Michigan law, only a pharmacy board inspector, the DEA or a police task force concentrating on drug investigations can enter a pharmacy. As many of you know, if you are not a pharmacist but own a pharmacy you are only supposed to be in the area where there are drugs when a licensed pharmacist is with you.
Additionally, the auditors act in a very intimidating manner, often refusing to talk to counsel, including me. They assert that they are entitled to have a drug utilization report (DUR) dating back as far as seven years for all prescriptions including cash, HAP, Blue Cross, etc. However, in my opinion the language and interpretation of the regulations only allow Medicaid auditors to examine records required to be kept by law in the provision of services to Medicaid patients. In other words, they are not entitled to information about HAP, cash, Caremark, etc., its prescription or DUR.
Further, they want to know who your employees are, past and present as well as their telephone numbers and personal data. Along with this they want you to tell them who all of your drug inventory suppliers are. What pharmacist remembers every wholesaler or provider of inventory for a year let alone several? Further, many of the wholesalers you might have dealt with on occasion are now out of business and their records are irretrievable.
What is their game? Very easy. I surmise, to put small pharmacies in Dearborn out of business through intimidation or simply to take money from a pharmacy that it cannot afford.
The legitimate standard for the audit industry is batch sampling with a random selection of prescriptions. What these OIG auditors want to do is unscientific, unfair and discriminatory. They want to just state that for example over seven years a pharmacy may have billed $2,000,000.00 for Medicaid prescriptions. However, with the wholesalers that pharmacy recalls (assuming they cooperate accurately) the audit may total inventory purchases of say $1,200,000.00. So they want the pharmacy to pay 800,000.00! That sounds like simple math but it is not proof of fraudulent billings and is grossly discriminatory and unfair.
On Tuesday, September 13, 2016 I cross examined these auditors under oath and learned much. Asking one auditor under oath how many audits he did, and he said 25. I asked of those 25 how many of the pharmacies were corporations owned by people with Arabic surnames? Answer was all 25. I asked them whether they are auditing CVS, Rite Aid, Walgreen, etc., in the same fashion and they said no. You can guess why they don’t want to screw with the big drug chains right?
Even if you are not Arabic or a hospital pharmacist you should care. We are all brother and sister pharmacists and we must support each other. If you are being plagued by these so-called OIG Medicaid audits please call me and we can discuss what to do about this. In the meantime, I would imagine that affected pharmacies would be marshalling their forces to launch a discrimination lawsuit in addition to other torts and causes of action, I would love to file this lawsuit!
Believe me all of my pharmacists complain that it is extremely hard to make an honest living with the low reimbursements from insurance companies and these hyper aggressive supposed Medicaid audits are taking what little pleasure is left in the profession as well as the dignity and wellbeing of the pharmacist and employees.
I fear for the future because I’m probably one of the last attorneys left that stands up for smaller people and businesses and the large law firms would just as soon play baseball with the State to maintain their comfortable lifestyles.
Best wishes to all.
Sep 16