Recently, the State of New Jersey, Division of Consumer Affairs (the department that administers, among other things, the Prescription Monitoring Program [PMP]), reclassified a drug known as Gabapentin. In reclassifying the drug, it is now considered a scheduled drug in New Jersey, and must now be part of the PMP reporting. For those that do not know what or how the PMP works, it is essentially a repository of controlled substances that are dispensed via prescription in New Jersey. There are nuances to what is and what is not reported on the PMP, so that is an extremely broad definition. The PMP logs if the drug was purchased with insurance or by cash, dates, pharmacies, prescribing provider, etc. It can be a useful tool for those with access, from the prescriber, the pharmacy and law enforcement. As with any tool, it is only useful if it is used. In a future post, I will discuss a matter where a prescriber failed to use the PMP, and how that caused a few “problems.”
Getting back to Gabapentin, many know this drug by its brand name, Neurontin (and other names). It is a powerful drug used to treat a variety of neurological issues. Where does the fraud come into play? Gabapentin is commonly used as one of several ingredients in compounding. As many of you are aware, compounding fraud is a very expensive fraud. Compounds have traditionally reimbursed at extremely high amounts. The Medicare program has a few safeguards in place with respect to compounds, but, like everything else, the program is always also at risk. Many pharmacies that do compounding will use the cheaper versions of the ingredients; bulk powders. In doing so, the compounds can be much more mass produced, and are not “custom” as would be a requirement by many plan standards. Medicare requires that in order for a compound to be reimbursed, at least one ingredient must be a Part D drug. Bulk powders are not FDA approved, a part of the requirement for the definition of a Part D drug. As such, the use of bulk powders in a compound would not be a reimbursable event.
Once again, getting back to Gabapentin. This drug has some severe potential side effects and contraindications. Here is where telemedicine becomes a potential problem. For the providers who are taking kickbacks in return for their signatures, and those prescriptions contain compounds with Gabapentin, are the patients being vetted thoroughly enough to ascertain if they take Gabapentin? At what levels are the patients already taking the drug? Is there a contraindication or side effect potential? Even worse, is the patient at a toxicity level by taking the compound and taking Gabapentin at the same time? I saw this many times when working compounding cases in New Jersey. The prescribing doctors are so focused on getting signatures on paper, have no relationship with the patient, and are not interfacing with the patient to even know there may be an issue present. In the end, there is fraud, kickbacks and patient harm potential. Although adding Gabapentin to the New Jersey PMP may not end issues with fraud, waste and abuse, it may actually expose other fraud schemes out there for a drug that was not until recently, an under the radar medication.
Advize Health LLC is a healthcare advisory and consulting company that provides a breadth of healthcare industry services in the payer, provider, and legal communities. Contact Eric Rubenstein for more information on our Fraud Spotlight series.