(Bloomberg) -- A major US insurer is taking an unusually hard line on doctors who it says improperly prescribed the diabetes treatment Ozempic, escalating the ongoing war over drugs that have become wildly popular for weight loss.
Elevance Health Inc.’s Anthem Blue Cross Blue Shield requested money from health-care providers and alleged they falsified patients’ medical records in ways that led the insurer to cover the medications. The amount demanded in a few cases totaled more than $1 million, according to records reviewed by Bloomberg.
The providers dispute Anthem’s claims, saying they prescribed the shots appropriately. They didn’t get any money for the drugs, which is paid to pharmacies. One doctor said he thinks the company wants to discourage using the drugs for unapproved purposes, a practice called off-label prescribing, which is legal and accepted in American medicine.
Doctors prescribe a drug off-label when they think it will help a patient despite lacking US government approval for a given condition. Several specialists said they prescribed Ozempic off-label to treat obesity before the drug attained its current popularity. It’s up to insurers to decide whether to pay for off-label prescriptions, and they sometimes do. In this instance, an insurer that paid for drugs is asking for money from prescribers, even though they didn’t receive the funds.
‘Highly Unusual’
Anthem’s demand for money is “highly unusual” and “seems weird,” said Jeff Levin-Scherz, a managing director at Willis Towers Watson Plc who advises employers on health coverage. “I’ve never heard of a carrier billing a physician for procedures or a medicine that was provided by someone else.”
Elevance regularly monitors for fraud, waste and abuse, a spokesperson said in an email. The company respects physicians' decision to prescribe Ozempic off-label, the spokesperson said.
Insurance companies are trying to contain ballooning costs for Novo Nordisk A/S and Eli Lilly & Co.’s diabetes and obesity shots, whose US sales topped $18 billion last year. The drugs offer benefit for a huge swath of the US population, where some 42% of adults have obesity. That’s prompted responses from insurers concerned about high price tags for drugs that cost roughly $1,000 a month and have to be taken regularly to maintain their effects.
Ozempic is “a widely used drug that has the potential to bring huge financial spending or outlay for the insurance companies,” said Ge Bai, a professor of accounting and health policy at Johns Hopkins University. “That’s why they are being so aggressive. It’s really going out of their usual lane.”
Ozempic and Lilly’s Mounjaro have US approval to treat diabetes, but contain the same ingredients as other drugs — Wegovy and Zepbound — that treat obesity. Doctors can legally prescribe the diabetes drugs off-label for obesity or other conditions, and it’s up to insurance companies to decide whether to cover them.
Elevance confirmed it contacted a small number of providers about payments. The company said the insurer will cover Ozempic only for treating patients with diabetes, in accordance with its US approval. Elevance said it’s engaged in reviewing documentation from the providers who responded.
Fraud Warnings
Last year, Anthem sent letters to some doctors and other prescribers noting that off-label use of diabetes drugs “for use in weight management is at an all-time high,” and reminding them that falsifying medical records to get drugs covered “is healthcare fraud,” according to records reviewed by Bloomberg. The letters went to fewer than 150 providers, according to an Elevance spokesperson.
Michael Jones, an obesity medicine specialist at Centra Health in Lynchburg, Virginia, got a letter like that. At the time, he was regularly prescribing Ozempic to people without diabetes to treat conditions like prediabetes or obesity, and insurers would sometimes cover the prescriptions. He said the practice was medically appropriate, so he kept doing it even after Anthem’s letter.
“I just thought they were trying to get me to stop prescribing off-label,” Jones said. Over the course of the year he did cut back on the practice, as insurers began throwing up more hurdles that blocked payment for off-label prescriptions.
In July, Jones got another letter, this one with a more direct message. Anthem said he had submitted requests containing false information for 125 Ozempic prescriptions for 22 patients, and asked for $125,969 to reimburse the insurer for the drugs, according to a copy of the letter reviewed by Bloomberg. The requests, called prior authorizations, are forms where prescribers submit medical information about a patient that insurers use to determine whether to pay for a treatment.
Getting Attention
Jones said he never submitted prior authorization forms for Ozempic for his 22 patients during the period Anthem investigated, and that he never said any of them had been diagnosed with diabetes. He just prescribed the drugs, and they were covered. Even if Anthem made a mistake by failing to require a prior authorization, Jones doesn’t think it’s his responsibility to pay for it.
“I don’t really believe they think they’re due $125,000,” Jones said. “I think they just want to get folks’ attention.”
His health system is in touch with Anthem about the issue, but it hasn’t been resolved, he said.
Insurers have a variety of ways to ensure that high-cost drugs are used sparingly, sometimes requiring patients to try cheaper alternatives, mandating doctors fill out paperwork, or refusing to pay for them altogether.
Normally, the companies might kick a doctor out of their network or put them on a performance improvement plan, if there was a concern about misusing drugs, Willis Towers’ Levin-Scherz said. In this case, the companies are asking for restitution from someone who didn’t receive money for the drugs, he said.
If “somebody besides the provider is actually getting the payment,” he said, “it’s hard to look to the provider for restitution.”
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