There was a significant increase in pharmacy fraud and abuse under the pandemic, analysts at OptumRx say.
The pharmacy benefit manager giant recovered $300 million in fraud, waste and abuse spend in 2020 and documented the largest ever increase in fraudulent claims, which were up 300% compared to 2019.
In addition, Optum’s investigative audits led to an increase of 135% in fraud recoveries last year from 2019. The average audit recovery per case was also 70% higher in 2020 than in 2019, Optum found.
“Unfortunately under this pandemic, it’s really created an opportunity for fraudsters to take advantage of this situation,” Heidi Lew, vice president of pharmacy network audit at OptumRx, told Fierce Healthcare.
Optum found the fraudulent behavior concentrated among independent pharmacies and rarely found similar activity among retail chains, Lew said. Due to the findings, the PBM axed 112 pharmacies from its network.
Of those, 45 were identified through its new Protective Fraud, Abuse and Waste Solution program, which launched last year and harnesses artificial intelligence and machine learning to track potential fraud.
Through the program, Optum generated $80.5 million in savings for clients.
“By using this technology, we were able to detect this significant increase in fraudulent activity that we probably wouldn’t have been able to identify otherwise, and then would have resulted in higher costs to our clients and our customers,” Lew said.
Some of the more common schemes identified in Optum’s audits last year related to telehealth, Lew said. Pharmacies would book telemarketers to call patients and ask them whether they were experiencing any pain or other symptoms.
Those telemarketers would then take down the patient’s insurance information, which the pharmacies would use to bill for unneeded and unwanted drugs such as topical pain creams, high-cost vitamins and migraine therapies.
Other trends identified included pharmacies taking advantage of looser restrictions offered under the pandemic by supplying patients with unneeded drug refills, Lew said. Some pharmacies were also dispensing generic medications while billing for branded products, she said.
That behavior drives up the pharmacy spend for plans and can also lead to higher copayments and out-of-pocket costs for patients, Lew said.
She said her team can study these trends more effectively using the AI available through its Protective Fraud, Abuse and Waste program and that as it conducts further audits it’s feeding the data back into the system to lead to better data analytics.
“It really helps us fraud investigators address these questionable pharmacies and claims more quickly,” Lew said.