Feds scrutinize ethics of drug maker rebates to LTC pharmacies

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The Centers for Medicare & Medicaid Services is now taking a hard look at the issue of drug maker rebates for long-term care pharmacies under the Medicare Part D drug benefit, according to the CMS Web site.

CMS said the rebates raise serious concerns because they can raise costs for the government, for Part D plans and for beneficiaries, and have the potential to spike demand for costlier drugs.

Drug makers provide what are referred to as "access/performance rebates" to long-term care pharmacies in part to maintain or increase use of their products. That type of effort to control market share for drug makers raise fraud and abuse concerns, CMS said in the FAQ section of its site.

Long-term pharmacies, such as Omnicare, defended the rebates it receives from drug makers, asserting that the price concessions actually save Part D plans money.

The CMS FAQ is available at: http://questions.cms.hhs.gov/cgi-bin/cmshhs.cfg/php/enduser/std_adp.php?p_faqid=6326.