Dive Brief:
- A surge in sales of specialty compounding creams used to treat pain and cramping is being eyed by the U.S. Department of Justice for suspected fraud amounting to half a billion dollars and impacting both government and private insurers.
- The creams also exploded on the market thanks to a major marketing effort most notable for its promotion by retired NFL quarterback Brett Favre. The campaign targets seniors and athletes.
- The investigation centers on allegations that some of the creams provide no medical value, that some have run more than $10,000, and that some pharmacies have increased profits by providing more than ordered, overbilling, and providing unrequested automatic refills, Dow Jones Business News reports.
Dive Insight:
The investigation raises the case once again for tight controls to monitor for fraudulent billing, as Tricare - the insurance program for U.S. military personnel, veterans, and their family members - found after becoming the worst-hit insurer in the apparent scheme.
Defense Department data indicates Tricare's payments for all compounded drugs, including creams, totaled $1.75 billion in its 2015 fiscal year, which was 18 times the amount it paid three years before. Tricare says it has since implemented new internal controls, the Dow Jones News reports.
Aside from Tricare, other impacted insurers include Medicare, Medicaid and private insurers that were not specified in news reports.