Medicaid Prescriptions Hit the Street with Alarming Frequency

From the medicine cabinet to the street. 33 people have been charged so far as Buffalo, NY investigators devote increasingly greater resources toward an emerging class of suppliers in the illicit drug trade: medical patients, including many who rely on Medicaid to fund their prescriptions. Often at no charge, patients visit multiple doctors and are coached by dealers on how to receive the most lucrative prescriptions. For example, Oxycontin, a time-released form of Oxydone, a narcotic pain killer, is a highly sought after drug. If a patient is on Medicaid, the program is billed about $1,060 for a typical 60-pill, 80-mg prescription, along with doctors’ fees.

The patient can turn around and sell the bottle for around $1,000 to a dealer, who might fetch as much as $7,200 on the street for it. Clearly this is a profitable business for those who are willing to break the law and defraud the government. The growing underground market for the types of pills often found inside the medicine cabinets of average people has surprised even seasoned DEA officials, who are equating this problem with that of street drugs like heroin or crack. They are now using sophisticated methods to capture the criminals involved, such as wiretaps, surveillance and cross-agency cooperation to follow the narcotic trail from pharmacy to street.

A GAO report last year that examined Medicaid abuse in New York, California, Illinois, North Carolina and Texas concluded that in these states, the cost to Medicaid for the fraudulent acquisition of prescription drugs was $63 million. Across the country, efforts are underway to curtail Medicaid prescription abuse and fraud. For example, in several states, state approval is required before OxyContin prescriptions are filled. In New York, the Office of Medicaid Inspector General restricts recipients to coverage for a single doctor and single pharmacy if suspicious activity is indicated. Nearly 10,000 New York Medicaid recipients are currently on restricted status, though they are not allowed to be dropped from the Medicaid program unless a crime has been proven.

With the onslaught of these recent investigative actions, it is becoming increasingly more important to have proper compliance programs in place protecting practices from patient drug seekers, as well as having narcotics agreements and random drug screening policies and practices in any pain practice.

For more information, please contact Abby Pendleton, Esq. at (248) 996-8510 or (212) 734-0128 or visit the Anesthesia and Pain and Compliance specialty pages on the HLP website.