Closing a Big Pharma Loophole in Medicaid

Congress claims the drug companies purposely misclassify drugs as generic instead of brand name to avoid paying higher rebates to Medicaid, and that it’s costing taxpayers millions of dollars.

About 3% of drugs in Medicaid’s rebate program, or 885 of the roughly 30,000 drugs in the system, may have been misclassified in 2016, according to a December 2017 report from HHS’ Office of Inspector General.

The 10 potentially misclassified drugs with the highest total reimbursement could have cost Medicaid an additional $1.3 billion from 2012 to 2016 compared to what those products would’ve cost if properly classified.

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