Drug overutilization review program for Medicare

CMS has developed an overutilization monitoring system to ensure that plans are implementing effective and appropriate controls against opioid and APAP (acetaminophen, brand name Tylenol®) overutilization and for review of beneficiaries referred by the CMS Center for Program Integrity (CPI) for possible overutilization issues.

The goal of overutilization monitoring is to prevent:

  • Overuse of APAP: More than the FDA daily maximum APAP dose of 4 grams.
  • Overuse of opioids: More than a 120 morphine-equivalent dose (MED) daily for 90 or more consecutive days.

APAP overutilization

Through extensive analysis of APAP usage reported by Part D plans, CMS has identified that APAP overutilization should be included in plan investigation of overutilization. In July 2013, CMS advised plans that they should prevent the dispensing of more than the FDA daily maximum APAP dose of 4 grams to any beneficiary. See FDA Drug Safety Communication for more information.

Opioid overutilization

The use of opioid drugs has the potential to lead to patient abuse, addiction and diversion of these drugs. It can also be associated with increased costs due to excessive health care utilization1.

The Centers for Medicare and Medicaid Services (CMS) conducted an analysis of prescriptions for Part D-covered drugs filled in 2011 by Part D sponsors such as Dean Health Plan. They estimated that, excluding cancer and hospice patients, approximately 225,000 Medicare Part D beneficiaries nationally received more than a 120 morphine-equivalent dose (MED) daily for 90 or more consecutive days, roughly 0.07% of the Part D population that year2.

CMS concluded that a cumulative daily MED of opioids is an indicator to potential dose-related risk for adverse drug reactions. Patients receiving 100 mg MED or more daily had an 8.9-fold increase in overdose risk and a 1.8% annual overdose rate compared with patients receiving 1 to 20 mg MED daily who had 0.2% annual overdose rate.

Dean Health Plan review process

CMS requires Dean Health Plan to comply with CMS drug utilization management requirements (42 CFR §423.153 et seq.) to prevent overutilization of prescribed Part D drugs, specifically including a pharmacist coordinated case management program for opioid and APAP overutilization. For further information about this important CMS initiative go to the CMS website, Improving Drug Utilization Controls in Part D.

Our process includes:

  • Retrospective drug utilization review to identify members who may be at risk for overutilization, or other safety issues, related to their use.
  • Prescriber notification by letter.
  • Enhanced primary care clinical pharmacist review of the identified cases and make clinically justified determinations as to the medical necessity of the treatment regimen.
  • Improved patient-centered care and communication between prescribers.

Identifying potential at-risk members

We receive quarterly reports from CMS for our review and analysis, and we have 30 days to respond to these reports. Individuals identified on CMS' report are added to our overutilization program.

Reviewing usage with prescribers

CMS expects plans to review and seek input on members at potential risk with their prescribers. This communication process involves letters and outreach calls. If you should receive a letter or call from us about one of your patients, please assist us in obtaining additional information. Our goal is to work effectively together to improve your patient's care.

  • Prescribers will receive an initial letter requesting information for the identified prescription(s). You can also respond to our inquiry via email or fax. Our letter will explain how to do this.
  • Prescribers have available to them Primary Care Clinical Pharmacists to support the completion of the medical necessity assessment.
  • Prescribers will receive at least three follow-up calls to discuss our letter.

We are not telling you what or how to prescribe. We are seeking input that:

  • The patient's opioid and APAP usage is being actively managed.
  • The dose is appropriate.
  • There is no need for any assistance from Dean Health Plan.

When prescribers do not respond: If we do not hear from you in response to our letter or our follow-up calls, we will proceed with our review. However, we may determine that information warrants that we implement a member point-of-sale (POS) claim edit (see below for more information).

When a patient has multiple prescribers: If our review identifies multiple prescribers, we will initiate a discussion to determine better coordination for potential patient drug seeking and to implement protocols/claim edits for at-risk members.

Review results

If you believe there are no safety concerns, we may be able to close our review at this point, and we will notify you of this within 2-3 business days of this decision.

If you believe there are safety concerns, we will work to identify resources to assist you, including:

  • Referral to pharmacy case management.
  • Referral to behavioral health/substance abuse services.
  • Request for a signed drug utilization agreement/action plan.
  • Putting a point of sale (POS) edit on the prescription.

Acting on review results

Action for POS edit: This edit cannot be implemented for at least 30 business days after the member and you are notified of it. We will send you, the member and CMS (both Central and Regional Offices) a letter if you and Dean Health Plan have agreed action is needed. We will also contact the pharmacy about the POS edit. The member has the right to request a coverage determination and appeal as well as file a grievance under Medicare rules.

Reporting suspected fraudulent activity to CMS: If a review identifies prescribers, members and/or pharmacies as potentially involved in fraudulent activity, Dean Health Plan is required to report this to the CMS Medicare Drug Integrity Contractor (NBI MEDIC).

Sharing data between Part D sponsors: When a member who has had a POS edit changes plans, CMS requires that Dean Health Plan facilitate the transfer of information to the new plan. We only transfer information if (1) the new plan requests it and (2) if applicable federal and state laws permit the transfer, including privacy laws that address substance abuse addiction.

According to 2007 data from the National Survey on Drug Use and Health, an estimated 5.2 million persons aged > 12 year (2.1% of US population) abused prescription opioids within the past month3.

Mean annual direct health care costs of opioid abusers were 8 times higher than for non-abusers – average per-person health care cost to payer was $15,884 vs. $1,830 respectively; p>0.01)4

Studies that include routine toxicology screening ... tend to show higher rates – ranging from 16% to 47% – of abuse or misuse [of opioids] among patients with chronic pain5.

Prescription opioid abusers have significantly more physician visits, mental health inpatient and outpatient services, hospital admissions, emergency department visits, MVA, and traumas6.

Mean drug costs for opioid abusers were more than 5 times than costs for non-abusers ($2,034 vs. $386, respectively; p<0.01)7.

Drug diversion drains health insurers up to $72.5 billion per year, including up to $24.9 billion for private insurers).


  1. Based on the following publications: US Department of Health and Human Services, Substance Abuse and Mental Health Administration Results from the National Survey on Drug use and Health: national findings, Rockville, MD; 2008 DHHS Publication No (SMA) 08-4343. US Department of Health and Human Services, substance Abuse and Mental Health Services Administration Drug Abuse Warning Network 2006: National estimates of drug-related emergency department visits. Rockville, MD; 2008. DAWN Series D-30, DHHS Publication No. (SMA) 08-4339. US Department of Health and Human Services, Substance Abuse and Mental Health Administration. Treatment episode data set (TEDS) 1996-2006. National admissions to substance abuse treatment services. Rockville, MD; 2008. DASIS Series S-43, DHHS Publication No. (SMA) 08-4347.
  2. Announcement of Calendar Year (CY) 2013 Medicare Advantage Capitation Rates and Medicare Advantage and Part D Payment Policies and Final Call Letter. Centers for Medicare and Medicaid Services, April 2, 2012.
  3. DHHS Publication No. (SMA) 08-4343
  4. White AG, Birnbaum HG, Mareva MN, et al. Direct costs of opioid abuse in an insured population in the United States. J Manag Care Pharm. 2005; 11: 469-479.
  5. Hahn, KL. Strategies to prevent opioid misuse, abuse, and diversion that may also reduce the associated costs. Am Health Drug Benefits. 2011; 4(2): 107-114.
  6. Coalition Against Insurance Fraud. Prescription for peril: How insurance fraud finances theft and abuse of addictive prescription drugs. Washington, DC; 2007.
  7. Chou R, Fanciullo GJ, Fine PG. et al. Clinical guidelines for the use of chronic opioid therapy in chronic noncancer pain. The Journal of Pain 2009.;10(2):113-130.


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Mailing Address: 

Prevea360 Medicare Advantage
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