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OIG Finds That More Than Half of Part D Plan Sponsors Not Reporting Fraud and Abuse

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The Office of Inspector General reviewed Part D sponsor-reported data on fraud and abuse between 2010 and 2012, 64,135 incidents in total, and published the following findings:

  • more than half of sponsors did not report data on potential fraud and abuse
  • of the sponsors that reported data, more than one-third did not identify any potential fraud or abuse in at least one of the reporting years
  • sponsor identification of potential fraud and abuse varied greatly, from 0 to almost 14,000 incidents a year
  • though CMS requires sponsors to investigate and undertake corrective actions, 28 percent of Part D sponsors reported performing no inquiries or corrective actions regarding potential fraud and abuse
  • CMS did not perform quality assurance checks on sponsor reported data or use the data to monitor the Part D program

The OIG recommended that CMS specifically require sponsors to report potential fraud and abuse to CMS and provide guidelines on how sponsors should report incidents. Furthermore, potential fraud and abuse data should be shared with all Part D sponsors and law enforcement to better identify fraud schemes. CMS responded saying that guidance was already provided to sponsors on how to report incidents, and that requiring sponsors to report incidents to CMS would be redundant since a contractor already collects this information. Also, CMS already provides data to law enforcement upon request and works with law enforcement in quarterly Fraud Work Group meetings. The OIG also recommended that CMS investigate the large variations in the number of incidents reported by sponsors, to which CMS fully agreed.

OIG Study


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