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Drug Spending

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.

Featured Reports

Report Title Issue Date Program Area(s) of Work
Medicaid Rebates for Physician-Administered Drugs (OEI-03-02-00660) 2004/04 Medicaid Program Compliance
Review of Additional Rebates for Brand-Name Drugs with Multiple Versions 2010/03 Medicaid Reimbursement
Drug Manufacturers' Noncompliance with Average Manufacturer Price Reporting Requirements (OEI-03-09-00060) 2010/09 Medicaid Program Compliance
Medicare Payments for Newly Available Generic Drugs (OEI-03-09-00510) 2011/01 Medicare Part B Reimbursement
States' Collection of Medicaid Rebates for Physician-Administered Drugs (OEI-03-09-00410) 2011/06 Medicaid Program Compliance
Replacing Average Wholesale Price: Medicaid Drug Payment Policy (OEI-03-11-00060) 2011/07 Medicaid Reimbursement
Medicaid Brand-Name Drugs: Rising Prices Are Offset by Manufacturer Rebates (OEI-03-10-00260) 2011/08 Medicaid Reimbursement
Medicare Payments for Drugs Used to Treat Wet Age-Related Macular Degeneration (OEI-03-10-00360) 2012/04 Medicare Part B Reimbursement
Least Costly Alternative Policies: Impact on Prostate Cancer Drugs Covered Under Medicare Part B (OEI-12-12-00210) 2012/11 Medicare Part B Reimbursement
Gaps in Oversight of Conflicts of Interest in Medicare Prescription Drug Decisions (OEI-05-10-00450) 2013/03 Medicare Part D Incentive Alignment
Medicaid Drug Pricing in State Maximum Allowable Cost Programs (OEI-03-11-00640) 2013/08 Medicaid Reimbursement
Medicare Could Collect Billions If Pharmaceutical Manufacturers Were Required To Pay Rebates for Part B Drugs (OEI-12-12-00260) 2013/09 Medicare Part B Reimbursement
Contract Pharmacy Arrangements in the 340B Program (OEI-05-13-00431) 2014/02 340 B Program Compliance
Update: Medicare Payments for End Stage Renal Disease Drugs (OEI-03-12-00550) 2014/03 Medicare Part B Reimbursement
Average Manufacturer Price Determinations by Selected Drug Manufacturers Generally Were Consistent With Federal Requirements (A-06-13-00014) 2014/06 Medicaid Program Compliance
Limitations in Manufacturer Reporting of Average Sales Price Data for Part B Drugs (OEI-12-13-00040) 2014/07 Medicare Part B Program Compliance
Medicaid Drug Rebate Dispute Resolution Could Be Improved (OEI-05-11-00580) 2014/08 Medicaid Program Compliance
Manufacturer Safeguards May Not Prevent Copayment Coupon Use for Part D Drugs (OEI-05-12-00540) 2014/09 Medicare Part D Program Compliance
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) 2014/09 Medicare Part B Reimbursement
States' Collection of Offset and Supplemental Medicaid Rebates (OEI-03-12-00520) 2014/12 Medicaid Program Compliance
Medicaid Rebates for Brand-Name Drugs Exceeded Part D Rebates by a Substantial Margin (OEI-03-13-00650) 2015/04 Medicaid Reimbursement
Medicare Part B Overpaid Millions for Selected Outpatient Drugs (A-09-14-02024) 2015/07 Medicare Part B Program Compliance
States' Collection of Rebates for Drugs Paid Through Medicaid Managed Care Organizations Has Improved (OEI-05-14-00431) 2015/09 Medicaid Program Compliance
Part B Payments for 340B-Purchased Drugs (OEI-12-14-00030) 2015/11 Medicare Part B Reimbursement
Average Manufacturer Prices Increased Faster Than Inflation for Many Generic Drugs (A-06-15-00030) 2015/12 Medicaid Reimbursement
High Part D Spending on Opioids and Substantial Growth in Compounded Drugs Raise Concerns (OEI-02-16-00290) 2016/06 Medicare Part D Program Compliance
State Efforts to Exclude 340B Drugs from Medicaid Managed Care Rebates (OEI-05-14-00430) 2016/06 Medicaid Program Compliance
High-Price Drugs Are Increasing Federal Payments for Medicare Part D Catastrophic Coverage (OEI-02-16-00270) 2017/01 Medicare Part D Reimbursement
Calculation of Potential Inflation-Indexed Rebates For Medicare Part B Drugs 2017 (OEI-12-17-00180) 2017/08 Medicare Part B Reimbursement
Excluding Noncovered Versions When Setting Payment for Two Part B Drugs Would Have Resulted in Lower Drug Costs for Medicare and its Beneficiaries (OEI-12-17-00260) 2017/11 Medicare Part B Reimbursement
Potential Misclassifications Reported by Drug Manufacturers May Have Led to $1 Billion in Lost Medicaid Rebates (OEI-03-17-00100) 2017/12 Medicaid Reimbursement
CMS Did Not Always Provide Accurate Medicaid Unit Rebate Offset Amounts to State Medicaid Agencies (A-07-17-06074) 2018/05 Medicaid Program Compliance
Increases in Reimbursement for Brand-Name Drugs in Part D (OEI-03-15-00080) 2018/06 Medicare Part D Reimbursement
Medicaid Could Save Hundreds of Millions by Excluding Authorized Generic Drug Transactions to Secondary Manufacturers from Brand Name Drugs’ Average Manufacturer Price Calculations (A-06-18-04002) 2019/04 Medicaid Reimbursement
One Percent of Drugs With Medicaid Reimbursement Were Not FDA-Approved (OEI-03-17-00120) 2019/05 Medicaid Reimbursement
Medicare Part D Rebates for Prescriptions Filled At 340B Contract Pharmacies (A-03-16-00002) 2019/07 Medicare Part D Reimbursement
Reasonable Assumptions in Manufacturer Reporting of AMPs and Best Prices (OEI-12-17-00130) 2019/09 Medicaid Reimbursement
CMS's Implementation of a 2014 Policy Change Resulted in Improvements in the Reporting of Coverage Gap Discounts Under Medicare Part D (A-07-16-06067) 2020/01 Medicare Part D Reimbursement; Program Compliance
States Could Do More to Oversee Spending and Contain Medicaid Costs for Specialty Drugs (OEI-03-17-00430) 2020/12 Medicaid Program Compliance
Medicare Part B Drug Payments: Impact of Price Substitutions Based on 2019 Average Sales Prices (OEI-03-21-00130) *Note: This Report is the Most Recent in a Series of Annual Reports* 2021/06 Medicare Part B Program Compliance
Comparison of Average Sales Prices and Average Manufacturer Prices: Results for the First Quarter of 2021 (OEI-03-21-00080) *Note: This Report is the Most Recent in a Series of Quarterly Reports* 2021/08 Medicare Part B Program Compliance
States' Collection of Medicaid Rebates from Drug Manufacturers Various Medicaid Program Compliance