An audit flagged 1,300 prescriptions for fast-acting fentanyl without evidence of required cancer diagnoses. Image: Andy Dean Photography/Shutterstock.com
An audit has found that inadequate controls over prescription drugs under the Federal Employees Compensation Act program allowed “thousands of inappropriate prescriptions and potentially lethal drugs such as fentanyl” and resulted in over-spending of as much as $320 million over 2015-2020.
The program “lacked sufficient clinical expertise and guidelines to ensure appropriate pharmaceutical decisions, which could negatively impact claimants’ health, recovery, and return to work,” said a Labor Department inspector general report. The report was based on findings of an outside audit firm that the IG engaged following several IG reports on potential overspending for prescription drugs in the FECA program.
The audit found that Labor’s Office of Workers’ Compensation Programs took a number of actions in response to the prior reports, including adding controls on prescriptions for “compounded” drugs—medications tailored to individual patients—and for opioids. That resulted in a significant reduction in spending on opioids, it found, although the cost of compounded drugs, which often are high-cost, continued to grow.
However, the audit also found that it “did not effectively monitor pharmaceutical policy changes to ensure implementation,” resulting for example in more than 1,300 prescriptions “for fast-acting fentanyl, a potentially lethal and extremely addictive drug, without evidence of required cancer diagnoses.” The program also paid for some 25,000 non-maintenance early-fill prescriptions and some 500 “convenience kits”—which package multiple drugs which can be bought more cheaply individually—without the required authorization.
It said the OWCP also “failed to timely identify and address emerging issues and did not perform sufficient oversight of prescription drugs that are highly scrutinized and rarely covered in workers’ compensation programs.” It further “did not have a process to ensure its pricing was competitive with other comparable payers in the industry”; “lacked controls to ensure the prices it paid for drugs were fair and reasonable”; and “did not capitalize on additional ways to reduce pharmaceutical spending, such as taking advantage of manufacturer rebates.”
“As a result, OWCP spent hundreds of millions of dollars on drugs that may not have been necessary or appropriate for FECA claimants,” it said.
In response to a series of recommendations on those issues, the Labor Department said that actions under most are under way and generally agreed with several others, including to better capture manufacturer rebates, review the effectiveness of policy changes, and increase its in-house expertise for reviewing the appropriateness of prescriptions.
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