OIG says Colorado falsely claimed $6.5 million in Medicaid payments

The state of Colorado falsely claimed $6.5 million in Medicaid reimbursement over three years after it failed to comply with drug rebate regulations.

HHS’ Office of Inspector General found that the Colorado Department of Health Care Policy and Financing didn’t properly follow requirements under the Medicaid drug rebate program from 2010 to 2012. For outpatient drugs to be eligible for reimbursement, manufacturers must enter into rebate agreements with the CMS. The state is required to invoice manufacturers for the rebates and submit data on drug use.

According to the OIG, Colorado didn’t invoice manufacturers for rebates totaling $13 million in eligible physician-administered drugs, $6.5 million of which was federal dollars. The OIG said Colorado should refund that money. A spokesman for the Colorado Department of Health Care Policy and Financing said the department doesn’t agree with the OIG’s audit findings and is working to invoice all rebate-eligible drugs so no funds will need to be reimbursed to the CMS.