Payments Made by Medicare Carriers for Drugs and Biologicals Furnished to Medicare Beneficiaries

Published by the Government Accountability Office on 1971-06-30.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

           U~TEB SMES         GENERAL Accou~mNc     OFFICE
                       WASHINGTON,   I3 C   20548

      TzitLb XV;r$f of tkm So&d. Seemrity Act protides, in pat,        that
Hedicwe coverage of Capugsand biologkals     s&U include:

      Initial  instmctiona    3ssued by SSA in Ju3.y 1966 provided that
dmgs and biologhals        wwe covered only if thy wema of the type
that, could not be self-admmstimd       by injection,    Vaceinatio~      OP
imocu%ations W&~FBcovwad if tkay wem dizwtly          related to tmat-
merit of an iqpry    OF direct exposure such as antirabies     treatment,
P19tamus, 2mtitoanhra, etc,
      SSA instmcted     its   regional offices in April. 1968 that the
detimmat~on     of tiethm       the dmgs OF biologicah   are of the type

                    S0Tl-l ANNIVERSARY 1921-1971
w&.&h     can be salf-adrdnis~~~d       should  be based on the usual. method
of adzn%niatration        Father Ihan on the fox% ia which th&mf&t            be
given in an ind%vj.dua.l. case. Althoug~ugs             and bfologicaT6.s wh?Lch
ccmld be self-adminiete~ed          were excluded frpom EedicaaJe covepage, the
instruction      p%otided -&.a% ckx~ges for concurx?ent sar~vices tiich
the beneficiary        recef~d,    such as the adminis%Wxon       of the
in~ectim,       could be coveleed,

       F$z3cause som0 carriers    ware   having   dlfficufti03          in     implenenting
the   April  n968 fmtFzrctions,       SSA ncevzsed its iust~uctions       in April
1969.     !the retised  intst~uctions     cha~~ged the csfxte~xa and pyovxded
that the detepmiaat%on of whether a drug OII’ biologic&L               is of a type
wfhich cannot ba self-admitistered          would bs based oyll the usual
method sf ack&=daQ~atxon sf f&a fom of Umt dmg OP biologkeal.                     as
fkrnished     by the indzvxdual      physicGxn.      En othea4 wopds, &en a
phy~&~~an 3njects a drug which is not uaurdbby self-injected,                the
injectkon     charge would be covered (reg~d3ess            of whethu~ the &ug
may also be avaalable        1~1 oval form) because it was not self-
administered      in the form actually      furnished     to the patfent,

      Under the Aprtl I.969 instructions    J the primary emphasis as to
whethe drugs and biologi4.s       were covezed serv%ces was placed on
a detex!mination of wheule~; these se~ticea were %(easonabEa and
necessary for the treatment    of the il3..z1ess ox” anjury for which
they tmm aakRWs&sPed.       The LnstFuctions     stated that cax9ien(s
should develop guxdeki.nes to screen ou> injectzLon. chaFges that did
not meet the afopementioad     cx%.teria.

        The carriers*   problems in admini&eriu,g     Nedicae    pro~&ions
8(elattig   to &ugs and biologkxls       fi??st cme to out attention        in
fiscal    year 1969 dur%ng OUF sletiew of pnaoceduras used by the
carriers     to dete9’mLne the reasonableness     of physieians~    chages.
As pax% of that review, we ezxmined a Ipandom sample of 100 claims
processed by each camie~ and noted that

        --aILl six CarFAeFS wer0 allowing         Ch2P@S for vitamin
           injections     &ich,     according to the April I.968 inst~uctfons,
           should have been disallowed        because the usual method of
           admfn~a~ring       these &ugs was by tablet OF other self-
           administerable       oral form,

        -4I.l. six carriers      were allo%Jmg charges           for unidentified
           injections    without   detesmiting whether           the injections         were
           of the type coveFed by Hedicae,       and

        --two of the caFrxepIs were allowing   chaPges for                   immunfeations
           which were not coveyed by the program.

                                                    ‘Ijajactions           hjections
                                   hjectrions       considex!ed            considered
                   Imjectio%as     allowed by       disallowable          questionable
                    claimed            lxaF%l%x1S
                                 No,      Amoumt

                       161       129      $56183                   $332    7           $ 32
    Blue 23hield         65       54       254      20              89     9             45
  Blugr Sh.5el.d       111       103       394      38             150    28             99
   New Hozk              9s       93       339      55             257     7             l-9
  %OU%Siajwa           103        97       351      24              84    12             60
Texas Blue
  Shield               139       135       726                            22             22
  Totals               673       E se                                     !2

      Of the’303 injections conszdered          disallowable,         the physician
expr%ss0d his cpimon that,

      4.24   $njections should not have been paid because the
        nakure of the Anjeet~ons ‘WEBS not ident%faed on tie
        claims, and

      -179 inJections     should not have been paid because they
         wem not considered     to be eompatib3ve Tath acceptable
         and necessary treatment    for the diagnosed fllnssses
         of the bemefzciary ,

     The p@mician considered payments for 83 in~ectS.ons questIon-
able because ad&tional  information would be needed to determine
that the services wema covered under Medicare.

        AlLhough the method used to select the Il.200 cl.aima for
review does not provzde a sound basas to make a statistical
projection,     we believs the fo%bo~ng facts UJustrate      the
potential     s%gnificance of this problem.

      --Of the 673 mpctions      for which charges were mads on those
         claims, about 57 percent should not--in     the opsnion of
         the SSA physic5an--have    been paad or should have been
         hel.d in abeyance by the Medicare carrier    until. further
         support was furrz&ed.

      --The   charge per    injection    averaged   about       $4.

      --The sue carriers  paid about IO.5 m-illion claims for
         services pronded  to Medzcare patients   durrng the
         12-month period ending Harch 1970,

      --Of the sample claims selected          in our revdew,         about 18
         percent contained charges for         injections.

      We were addsed by the SSA physician           that before claims
examfners could properly      datermane whether charges for injections
should be covered by Medicare,         the examiners need detalled        guide-
tines sha;ting (a) the specific        k&-+tions    that are considered         as
acceptable    and necessary treatment for a particular            8XLness and
 (2) the frequency    that injections      can be administered       and stil1
be an effective    treatment    fog the illness.       Ke advised us also
that, if claims examiners do not have detaIled            Instructions,        a
nurse or medical. consultant,       z.n most in&aces,       would have to
determine vhetheb chmges for injectxons           should be coveFed.

       mere appears to be some misunderstanding      on the part of the
carrzlers as to the aIUowability      of charges for drugs and biologicals
protided   to MedZcare beneficiaries.      Because our review of claims

under the Aprfl, 1969 instructions   was peflfoPmed at SSA headquascters
and did not invo'%vs a review of the cax~ie~s~ recopds, we we~e not
able to deteFmine the ressons the can‘xe~s pald for dngs and bfo-
l.o~~cal.s which *peaFed questionable.
       we suggest, therefore, that 3% request the C~T~BLUS to
explain why they aXlomc+d cha~@m for i.n~ec-tAons wh~~ch~
according to the SXA physicran,     should have beemaquestioned
or disalllowed,     We suggest also that SSA carefully  Fmw3ff the
carrxx!s~ responses to determine whethex! there is a need foY'
mox% specifx      guideUnes on (3) the types of dx%gs and bfo-
lo&d.s      conrsfderad acceptable andi necess~y for the tx%atmerxt
of spedffc     ilbess,   and (2) the aXLo~ab%e fpequeney of such
      W&tham discussed this matter with members of yotz staff
and ageed to furnish them with the nfTos%ation developed
during OUP retiewo
      We would appzseciate being advised of any actions you take
on this matter and w5Ii.l. be pleased to discuss the subject
f+urtheP with yact OF your staff,

HF, Robert M, BaXL
 Commission@r of Soeia~ Security
f)sp@ken% of Health, Education,
   and Welfare