Medicaid Legislation with Medicaid Rebate Misclassification Penalty Heads to President Trump

The House and Senate have both approved H.R. 1839, the Medicaid Services Investment and Accountability Act of 2019, clearing it for President Trump’s signature.  Notably, the legislation would: subject drug manufacturers to a new civil monetary penalty (CMP) for knowingly misclassifying or misreporting covered outpatient drugs under a Medicaid drug rebate agreement (such as by knowingly submitting incorrect drug product information).  The penalty would equal up to two times the difference between the rebate amount the manufacturer paid and the amount the manufacturer would have paid if the drug had been correctly classified.  The CMP would be imposed in addition to any other penalties or recoveries.  Furthermore, the legislation would strengthen requirements for recovery of unpaid rebate amounts, without regard to whether the manufacturer knowingly made the misclassification or should have known that the misclassification would be made, and it…

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