Department of Civil Service
New York State Health Insurance Program: Payments for Prescription Drugs Dispensed by Kings Pharmacy
The New York State Health Insurance Program (NYSHIP) provides health insurance coverage to active and retired State, participating local government and school district employees and their dependents. The Empire Plan (Plan) is the primary health benefits plan for NYSHIP and includes prescription drug coverage. The Department of Civil Service (Department) contracts with United HealthCare to provide prescription drug coverage under the Plan. United HealthCare subcontracted its claims processing and payment functions for drug coverage to Medco Health Solutions, Incorporated (Medco). For the period from January 1, 2008 through July 9, 2010, the State paid United HealthCare almost $5.9 million for 30,066 prescriptions (47,780 claims) that were reported by Kings Pharmacy.
Medco conducted an on-site audit of Kings Pharmacy in April 2009 and identified overpayments totaling $124,280 from (24 percent of the claims it tested). We examined the population of prescriptions and corresponding claim payments that were outside the scope of Medco’s work and concluded that the State overpaid Kings Pharmacy by at least $591,199 more than Medco had identified. We recommended the overpayments be recovered.
For a complete copy of Report 2010-S-43 click here.
For a copy of the 90-day response click here.