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Drug Spending

Updated: 08-11-2022

For over 25 years, the HHS Office of Inspector General has conducted work to assess drug spending in HHS programs. This work covers three domains: reimbursement, program compliance, and incentive alignment. This page is a compilation of completed reports, unimplemented recommendations, enforcement actions, and industry guidance.


OIG makes recommendations to HHS that promote efficiency and effectiveness in the administration of HHS programs and operations. These recommendations generally stem from OIG's audits and evaluations. For a list of unimplemented recommendations across HHS programs, see the Top Unimplemented Recommendations.

Below is a list of the unimplemented recommendations in the drug spending area that would most positively affect HHS programs in terms of saving money and/or improving quality and should therefore be prioritized for implementation.

Unimplemented Recommendation Report Work Area
CMS should provide States with acquisition cost data for a wider range of specialty drugs. States Could Do More to Oversee Spending and Contain Medicaid Costs for Specialty Drugs (OEI-03-17-00430) (Issue Date: 12-23-2020) Program Compliance
CMS should work with the manufacturers associated with errors to correct and resubmit accurate product data. Some Manufacturers Reported Inaccurate Drug Product Data to CMS (OEI-03-19-00200) (Issue Date: 09-11-2020) Program Compliance
CMS should develop and execute a strategy to ensure Part D does not pay for drugs that should be covered by the Part A hospice benefit. Medicare Part D Is Still Paying Millions for Drugs Already Paid for Under the Part A Hospice Benefit (A-06-17-08004) (Issue Date: 08-01-2019) Program Compliance
CMS should require the use of claim-level methods to identify 340B drugs. State Efforts to Exclude 340B Drugs from Medicaid Managed Care Rebates (OEI-05-14-00430) (Issue Date: 06-06-2016) Program Compliance
CMS should amend current regulations to decrease the Part B payment rates for dispensing and supplying fees to rates similar to those of other payers, such as Part D and Medicaid. Medicare Part B Prescription Drug Dispensing and Supplying Fee Payment Rates Are Considerably Higher Than the Rates Paid by Other Government Programs (A-06-12-00038) (Issue Date: 09-15-2014) Reimbursement
CMS should examine the potential impacts of establishing a prescription drug rebate program under Medicare Part B and, if appropriate, seek legislative change. Medicare Could Collect Billions If Manufacturers Were Required To Pay Rebates for Part B Drugs (OEI-12-12-00260) (Issue Date: 09-09-2013) Reimbursement
CMS should consider seeking legislative authority to implement least costly alternative policies for Part B drugs under appropriate circumstances. Least Costly Alternative Policies: Impact on Prostate Cancer Drugs Covered Under Part B (OEI-12-12-00210) (Issue Date: 11-21-2012) Reimbursement