WASHINGTON – Today, Sen. Tom Carper (D-Del.), Chairman of the Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Security, convened the hearing, "Costs of Prescription Drug Abuse in the Medicare Part D Program."

For more information or to watch a live webcast of the hearing, please click here.

To view a copy of the Government Accountability Office (GAO) report, "GAO-11-699, Medicare Part D: Instances of Questionable Access to Prescription Drugs," click here.

A copy of Sen. Carper's opening remarks, as prepared for delivery, follows:

"Over the past several years, we've been engaged here in Washington and across the country in a conversation about our nation's deficit and debt and the cost of federal programs. The conversation has been serious and, at times, heated. Unfortunately, we've yet to reach a consensus on a plan to extract the country from the serious fiscal challenges it faces. But there's one thing, however, that I think we can all agree upon: We must stop the fiscal bleeding caused by waste, fraud, and abuse.

"This is a small subcommittee, but for years we've been almost singularly focused on how the federal government can get better results for less money or better results for the same amount of money. Working together with partners such as the Government Accountability Office (GAO), Office of Management and Budget (OMB), Inspectors General, and other government watchdog groups, we've tried to maximize our oversight. And, I believe that we've made an impact.

"We've drilled down on how the federal government wastes millions annually maintaining property and buildings that we neither need nor want. We've examined the billions that agencies waste on the $125 billion in avoidable improper payments made to contractors, ineligible program participants, and even dead people. We've focused like a laser on federal information technology projects that have gone billions of dollars over budget without ever delivering any benefits.

"One issue we've spent a lot of time taking a look at recently is the enormous amount of fraud, waste, and abuse that is perpetrated within Medicare and Medicaid. These programs provide life-saving benefits to millions of our nation's most vulnerable. Unfortunately, too often, criminals have figured out how to use Medicare and Medicaid for their own gain.

"Roughly two years ago, we held a hearing dealing with fraud and abuse in the Medicaid program. At that hearing, we learned that GAO had found tens of thousands of Medicaid beneficiaries and providers involved in fraudulent or abusive purchases of controlled substances through the program. After that hearing, we asked the GAO to see whether or not something similar might be going on in the Medicare Part D program.

"I was disappointed – but not surprised – to learn that GAO has found evidence that a number of Part D beneficiaries are likely abusing the system to obtain powerful drugs to fuel their own addictions or to sell on the street.

"As part of their analysis, GAO auditors looked at all of the prescriptions paid for by Part D in the year 2008. Combing through over a billion prescription records, they found that over 170,000 Part D beneficiaries apparently engaged that year in a practice commonly known as 'doctor shopping.' These beneficiaries had gone to five or more doctors to obtain prescriptions for the same drugs.

"In one case, GAO found a beneficiary who received prescriptions from 87 different medical practitioners in 2008. In another case, a beneficiary received three years worth of Oxycodone pills from 58 different prescribing doctors in just one year.

"We need to be honest about what these findings mean. They mean that federal dollars intended to address the health needs of the elderly and the poor are instead being used to feed addictions or to pad the wallets of drug dealers. This is clearly unacceptable.

"According to GAO, the controls that Centers for Medicare and Medicaid Services (CMS) has put into place to stop this sort of abuse haven't done the trick. Under the plan CMS has put in place to combat doctor shopping, if a Part D plan sponsor suspects a beneficiary is doctor shopping, they send a letter to the doctors who've been visited. The letter is sent along with a self-addressed envelope in which the doctors can send a response to the sponsor's concerns. In some cases, the doctors will stop giving the doctor-shopping patients prescriptions. In other cases, they won't. Sometimes, the letters go unanswered.

"GAO has made several recommendations to CMS on how to tighten up control of the program. Included among these recommendations is a suggestion that beneficiaries be limited to one doctor and one pharmacy, an approach many states use in their Medicaid programs. I look forward to hearing more about this suggestion from our witnesses today.

"In addition, I understand that just last week – perhaps as a result of GAO's work – CMS has issued new guidance to Part D plan sponsors. This guidance suggests that plans begin denying beneficiaries at the point of sale if they suspect abuse. This is an important change that I want to hear more about.

"I have worked with Senator Tom Coburn, Senator Scott Brown, and others of this panel to develop bipartisan legislation that curbs waste and fraud in both Medicare and Medicaid. Our legislation, The Medicare and Medicaid Fighting Fraud and Abuse to Save Taxpayer Dollars Act (S.1251) – also known as the 'FAST Act' – contains a set of important steps that will help rein in those trying to defraud our federal health care programs. The FAST Act has provisions that directly affect fraud in Medicare Part D, including strengthening Prescription Drug Monitoring Programs and requiring closer coordination between CMS, its oversight contractors, the Drug Enforcement Administration (DEA) and state and local law enforcement. Our proposal also requires that the list of doctors who can prescribe controlled substances like pain-killers be up-to-date and accurate.

"As many of you know, 12 of our colleagues are currently serving on a bipartisan, bicameral Joint Select Committee that has been tasked by the rest of us with coming up with a plan to begin to put our fiscal house in order. If at some point that Committee and Congress as a whole are to come to agreement on a meaningful plan for addressing our country's fiscal challenges, we'll need to address issues like the ones we're talking about here today.

"As I close today, I want to make a comment on prescription drug abuse.

"The dangers associated with the misuse of prescription drugs have become better known in the past few years as celebrities and other public figures have succumbed to their lethal effects; however, less widely publicized are the millions of Americans – including children – who abuse the same drugs. Unfortunately, children are abusing prescription drugs at an alarming rate. One out of five teenagers in America has abused, or is abusing, prescription drugs. This is a drug problem that could impact any American home with a medicine cabinet. As a father, I find this news especially troubling.

"I make this point so that it's clear. While there is a financial cost to the fraud and abuse of controlled substances paid for by Medicare, we can't ignore the fact that there's a human cost, as well. Prescription drug abuse is the fastest-growing addiction in the United States. The difference between a 'street drug' like cocaine and a prescription pain pill is that in many cases, as this hearing and this subcommittee' previous work shows, the federal government is often paying to feed this addiction with taxpayer money.

"Aside from our financial imperative, then, we have a moral imperative to ensure that our public health care system isn't used – or misused – to further intensify and subsidize a public health crisis."

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