Department of Health and Human Services 
OFFICE OF 
 
INSPECTOR GENERAL 
 
 
 
 
 
 
S -G
ECOND ENERATION 
 
 
A D U
NTIPSYCHOTIC  RUG  SE 
 
 
A M -E
MONG  EDICAID NROLLED 
 
C   :  Q - -C
HILDREN    UALITY OF ARE 
 
C  
ONCERNS 
 
Daniel R. Levinson   
Inspector General  
 
March 2015  
OEI-07-12-00320   
   
EXECUTIVE SUMMARY:  SECOND-GENERATION ANTIPSYCHOTIC DRUG USE AMONG 
MEDICAID-ENROLLED CHILDREN:  QUALITY-OF-CARE CONCERNS  
OEI-07-12-00320  
 
WHY WE DID THIS STUDY  
Second-generation antipsychotics (SGAs) are a class of drugs used to treat psychiatric disorders, such as 
schizophrenia, bipolar disorder, and psychotic depression.  SGAs are widely  used to treat children enrolled 
in Medicaid who have mental health conditions.  However, SGAs can have serious side effects and little 
clinical research has been conducted on the safety  of treating children with these drugs.  Consequently, 
childrens treatment with SGAs needs careful management and monitoring.  This evaluation examines the 
quality of care provided to children receiving SGAs that were paid for by  Medicaid.   
 
HOW WE DID THIS STUDY  
We selected a sample of 687 claims for SGAs prescribed to children in California, Florida, Illinois, 

New York, and Texas.  These States represented approximately 39 percent of total Medicaid payments for 

SGAs in 2011.  Board-certified child and adolescent psychiatrists reviewed medical records related to the 

sampled claims using seven criteria related to quality-of-care concerns (see the chart below for the criteria).  

We established these criteria on the basis of information and guidelines issued by various Federal and State 

agencies and professional associations regarding the prescribing of psychotropic drugs to children.   

 
WHAT WE FOUND  
The graphic below illustrates the percentages of quality-of-care concerns identified in the medical records 
associated with claims for SGAs prescribed to children. 
Medical reviewers  identified multiple quality-of-care concerns for many claims.  
 
Source:  OIG analysis of Medicaid claims in five states, 2014. 
   
   
 
In the five States, 8 percent of SGAs were prescribed for the limited number of medically accepted 
pediatric indications. There are only five SGAs with medically  accepted pediatric indications.  It is not 
uncommon for doctors to prescribe, or Medicaid to pay  for, SGAs for children for indications that are not 
medically accepted.  Medically accepted indications include both uses of drugs approved by the Food and 
Drug Administration (FDA) and uses supported by one or more of three drug compendia. It is difficult to 
conduct the clinical trials needed to obtain FDA approval or compendia support for pediatric uses of drugs.     
 
Three of the eleven SGAs carry an FDA boxed warning regarding increased chances of suicidal thinking 
and behavior in pediatric patients. We found that over a third of SGAs were prescribed in the presence of 
conditions described in the FDA boxed warning.  Physicians are not prohibited from prescribing a drug for 
a patient who has the condition(s) specified in the FDA boxed warning if the physician judges that the 
benefits may outweigh the risks.      
 
WHAT WE RECOMMEND  
To ensure the quality of the care provided to children receiving SGAs, we made three recommendations to 
the Centers for Medicare & Medicaid Services (CMS).  First, we recommended that CMS work with State 
Medicaid programs to perform utilization reviews of SGAs prescribed to children.  Second, we 
recommended that CMS work with State Medicaid programs to conduct periodic reviews of medical 
records associated with claims for SGAs prescribed to children.  Third, we recommended that CMS work 
with States to consider other methods of enhanced oversight of SGAs prescribed to children, such as 
implementing peer review programs.  CMS concurred with all three recommendations.  
   
   
TABLE OF CONTENTS 
 
Objectives ....................................................................................................1 

Background..................................................................................................1 

Methodology................................................................................................6 

Findings........................................................................................................9 

In the five States studied, quality-of-care concerns were  

identified in the medical records for 67 percent of claims for  

SGAs prescribed to children ............................................................9 

In the five States studied, 8 percent of SGAs were prescribed  
for the limited number of medically accepted pediatric uses ........12 

Conclusion and Recommendations ............................................................15 

Agency Comments and Office of Inspector General Response .....16 

Appendixes ................................................................................................17 

A: FDA Boxed Warning Regarding Children on SGA 
  
Product Labeling............................................................................17 

B: Sources of Guidance and Information on the Use of SGAs  

To Treat Children ...........................................................................18 

C: Detailed Methodology..............................................................21 

D: Descriptive Data on Population and Sampled Claims  .............26 

E: Statistical Estimates and Confidence Intervals ........................29 

F: Agency Comments ....................................................................31 

Acknowledgments......................................................................................35 

 
 
 
 
 
 
   
 
   
   
OBJECTIVES  
To determine the extent to which claims for second-generation antipsychotics 
(SGAs) prescribed to children enrolled in Medicaid in five selected States: 
1. 	  presented quality-of-care concerns and 
2. 	  were prescribed for indications other than medically accepted indications 
and/or in the presence of conditions specified in the Food and Drug 
Administration (FDA) boxed warning. 
BACKGROUND 
FDA  Approval of SGAs 
FDA must approve drugs before companies can legally sell them in the United 
States.1  If FDA determines that a drugs benefits for its intended use outweigh its 
known risks, then FDA approves the drug for sale.2   At the time of our review, 
FDA had approved five SGAs for use by children in the treatment of  
schizophrenia, bipolar disorder, and irritability associated with autistic disorder.3, 4   
The five SGAs that FDA has approved for use by children are aripiprazole,  
olanzapine, paliperidone, quetiapine fumarate, and risperidone.  Aripiprazole and 
risperidone are approved to treat all three of the diagnoses named above.  
Olanzapine and quetiapine fumarate are approved to treat schizophrenia and 
bipolar disorder.  Paliperidone is approved to treat only schizophrenia.  There are 
six additional SGAs with FDA-approved uses for adults.5     
Off-label uses of FDA-approved drugs. After FDA approves a drug for a specific 
use, physicians are permitted to prescribe that drug for other uses.  Prescribing 
drugs for nonapproved uses is often referred to as off-label prescribing.  
Off-label prescribing is not uncommon, especially for drugs prescribed to 
____________________________________________________________ 
1 FDA approval of a drug is based on the results of testing for safety and efficacy by the company 
wishing to sell the drug.  FDA, Development and Approval Process  (Drugs). Accessed at  
http://www.fda.gov/Drugs/DevelopmentApprovalProcess/default.htm on May 12, 2014.  
2 FDA,  Approved Drugs:  Questions and  Answers.  Accessed at 
http://www.fda.gov/drugs/resourcesforyou/consumers/ucm054420.htm on May 12, 2014. 
3 Antipsychotic  drugs are separated into two classes:  first-generation (or conventional) and 
second-generation (or atypical).  First-generation antipsychotic drugs were introduced in the 
1950s; SGAs were introduced in the 1990s.   
4 These five SGAs are approved by FDA for  use by children under age 18.  For purposes of this  
study, we defined children to include those 017 years old during the review period to conform  
to the FDAs age ranges. 
5 The six additional  SGAs with FDA-approved uses for adults are asenapine, clozapine, 
iloperidone, lurasidone, olanzapine/fluoxetine, and ziprasidone.  FDA,  Atypical Antipsychotic 
Drugs Information.  Accessed at http://www.fda.gov/Drugs/DrugSafety/ 
PostmarketDrugSafetyInformationforPatientsandProviders/ucm094303.htm on May 12, 2014. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       1    
   
children, as it is difficult to conduct the clinical trials needed for FDA approval of 
drugs for the pediatric population.6    
FDA boxed warning. If drug manufacturers and/or FDA determine that a drug 
may have severe or life-threatening risks when used to treat patients with specific 
conditions, FDA requires that the products labeling include a boxed warning 
describing those risks.7  However, physicians are not prohibited from prescribing 
a drug for a patient who has the condition(s) specified in the FDA boxed warning 
if the physician judges that the benefits may outweigh the risks.   
As of June 2012, three SGAsaripiprazole, olanzapine/fluoxetine, and quetiapine 
fumaratecarried an FDA boxed warning specific to children.  The warning 
describes the increased chance of suicidal thinking and behavior in children, 
adolescents, and young adults with major depressive disorder and other 
psychiatric disorders being treated with them.  Two of these SGAs that carry the 
boxed warningaripiprazole and quetiapine fumarateare also among the five 
SGAs that have FDA-approved pediatric uses.  See Appendix A for an example of 
the boxed warning for an SGA. 
Medicaid Coverage of Outpatient Prescription Drugs  
All State Medicaid programs cover outpatient prescription drugs.8  State Medicaid 
programs must pay for covered outpatient drugs prescribed for medically accepted 
indications and may pay for outpatient drugs not prescribed for medically 
accepted indications.   
Medically accepted indications. The Act defines medically accepted 
indications as both the uses approved by FDA and those uses, including off-label 
uses, that are supported by one or more of three compendia.9   At the time of our 
review, only one SGArisperidonehad any medically accepted indications for 
pediatric use beyond those approved by FDA.10  For the other SGAs, there were 
____________________________________________________________ 
6 FDA,  Drug Research  and Children.  Accessed at http://www.fda.gov/Drugs/ResourcesForYou/  
Consumers/ucm143565.htm on April 22, 2014.  Institute of Medicine  (US) Committee on Clinical 
Research Involving Children,  Field and Berman, eds., Ethical Conduct of Clinical  Research  
Involving Children, Washington,  DC:   National Academies Press, 2004; pp. 59  and 61.  Accessed 
at http://www.ncbi.nlm.nih.gov/books/NBK25557/pdf/TOC.pdf on April 22, 2014. 
7 FDA,  An FDA Guide to  Drug Safety Terms.  Accessed at 
http://www.fda.gov/forconsumers/consumerupdates/ucm107970.htm on May 12, 2014.  
8 Social Security Act (the  Act)   1905(a)(12); CMS, Medicaid Prescription Drugs Program. 
Accessed at http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-
Topics/Benefits/Prescription-Drugs/Prescription-Drugs.html on May 12, 2014.   
9 Section 1927(g)(1)(B)(i)(I)(III) of the Act.  The three compendia are (1) the American Society 
of Health System Pharmacists, Inc.s American Hospital Formulary Service Drug Information, 
(2) the  United States PharmacopeiaDrug Information (or its successor publications), and 
(3) DrugDEX Information System.  
10 Medically accepted indications for risperidone include its FDA-approved  uses as well as  its use 
to treat (1) behavioral syndrome-mental retardation and (2) pervasive developmental disorder. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       2    
   
no medically accepted indications beyond the FDA-approved uses; the medically 
accepted indications and the FDA-approved uses are identical.   
Limitations on Medicaid coverage of drugs. Section 1927 of the Act establishes 
the permissible limitations on and exclusions of Medicaid coverage of outpatient 
drugs.11  Under section 1927, States can choose to limit or exclude coverage of 
outpatient drugs if the prescribed uses are not for medically accepted indications.12      
However, State Medicaid programs may choose to cover outpatient drugs not 

prescribed for medically accepted indications.  Table 1 shows which SGAs have 

FDA-approved pediatric uses, which SGAs have medically accepted pediatric 

indications other than the FDA-approved pediatric uses, and which SGAs carry 

the FDA boxed warning specific to children.    

Table 1: FDA-Approved Pediatric Uses, Medically Accepted Pediatric Indications, 
and FDA Boxed Warnings on Second-Generation Antipsychotics  
Medically Accepted Pediatric 
FDA-Approved   FDA Boxed Warning 
Drug Name   Indication(s) Other Than 
Pediatric Use(s)   Specific to Children  
FDA-Approved Pediatric Use(s)  
aripiprazole  Yes   No  Yes  
asenapine  No  No  No 
clozapine No  No  No 
iloperidone  No  No  No 
lurasidone  No  No  No 
olanzapine  Yes   No  No 
olanzapine/fluoxetine  No  No   Yes  
paliperidone  Yes   No  No 
quetiapine fumarate  Yes   No  Yes  
risperidone   Yes   Yes   No 
ziprasidone  No  No  No 
Source:  Office of  Inspector General (OIG) analysis of  compendia, 2014. 
Four of the five States included in this evaluationCalifornia, Florida, Illinois, 
and Texascovered drugs not prescribed for medically accepted indications.  
These States used information regarding medically accepted indications in 
making case-by-case coverage decisions, such as decisions on requests for prior 
____________________________________________________________ 
11 Section 1927(k)(2) of the Act defines covered outpatient  drugs as drugs that are dispensed 
only upon  prescription and that are approved  for  safety and effectiveness as prescription drugs 
under the Federal Food, Drug, and Cosmetic Act.      
12 Section 1927(d)(1)(B)(i) of the Act. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       3    
   
authorization.13  Of the five States reviewed, only New York limited coverage of 
drugs to those prescribed for medically accepted indications.  
Sources of Guidance and Information on the Use of SGAs To Treat 
Children 
There are no Federal Medicaid requirements regarding the appropriate prescribing 
of SGAs to children. However, a number of Federal and State agencies and 
professional associations have issued information and guidelines on the 
prescribing of such drugs to children.14  These guidelines and information include: 
 	  AACAP practice parameterThe American Academy of Child and 
Adolescent Psychiatrys  (AACAP) practice parameter on the use of 
psychotropic medications to treat children identifies practices that may 
reduce the use of ineffective and inappropriate medications.  These 
practices include developing monitoring plans, using adequate dosages 
and durations of treatment, and providing a clear rationale for the use of 
polypharmacy (the concurrent use of multiple drugs).15    
	   HEDIS measuresThe National Committee for Quality Assurance 
(NCQA) publishes the Healthcare Effectiveness Data and Information Set 
(HEDIS), which is used to measure the performance of health plans.16  In 
July 2014, NCQA published new measures for HEDIS 2015 on the safe 
and judicious use of antipsychotics in children and adolescents.  These 
measures assess the appropriate use and management of antipsychotic 
drugs in youth.  Reporting on the new measures will begin in June 2015. 
 	  ACF information memorandumOn April 11, 2012, the Administration 
for Children and Families (ACF) released an information memorandum  
entitled Promoting the Safe, Appropriate, and Effective Use of 
Psychotropic Medication for Children in Foster Care.17   This 
memorandum identifies three outlier practices that may indicate that 
issues other than clinical need are influencing the prescribing of SGAs:  
____________________________________________________________ 
13 States may require, as a condition of coverage or  payment for a covered outpatient  drug, that  
a drug  be authorized  before it is dispensed.  This type  of approval is known as prior authorization.   
Sections 1927(d)(1)(A) and (d)(5)  of the Act. 
14 The guidance discussed here covers all  psychotropic drugsa category that includes SGAs and 
several other types of drugs.  Other classes of psychotropic drugs include  attention deficit/ 
hyperactivity disorder (ADHD) drugs, antianxiety drugs, antidepressants, first-generation 
antipsychotics, hypnotics, and mood stabilizers.  This study focuses specifically on SGAs. 
15 AACAP, Practice Parameter on the Use of Psychotropic Medication in  Children and  
Adolescents, J. Am. Acad. Child Adolesc. Psychiatry, 2009; 48(9): 961973.   
16 State Medicaid programs  may report voluntarily on the HEDIS measures. 
17 ACF,  Promoting  the Safe, Appropriate, and Effective Use of Psychotropic Medication for  
Children in Foster Care,  Log No. ACYF-CB-IM-12-03, April 11, 2012.  Accessed at 
http://www.acf.hhs.gov/sites/default/files/cb/im1203.pdf on  May 12, 2014. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       4    
   
prescribing too many concurrent drugs, prescribing dosages that are too 
high, and prescribing SGAs to children at too young an age. 
 	  Report and Resource GuideIn 2010, a collaboration among 16 States, 
the Rutgers University Center for Education and Research on Mental 
Health Therapeutics (CERTs), and the Medicaid Medical Directors 
Learning Network (MMDLN) produced the Antipsychotic Medication Use 
in Medicaid Children and Adolescents: Report and Resource Guide From 
a 16-State Study (hereinafter referred to as the Report and Resource 
Guide).18   This guide contains information on utilization patterns and 
treatment practices that raise clinical concerns.  Among the issues listed 
are polypharmacy, wrong dosages, and the prescribing of antipsychotic 
drugs to very young children.19    
	   State utilization guidelinesState agencies in Florida and Texas have 
each developed utilization guidelines that can help identify when further 
review of the treatment of children with SGAs is necessary.  These States  
guidelines address issues such as polypharmacy, inadequate indications for 
use of drugs, excessive dosage, and prescribing of drugs to very young 
children.  
For detailed information on these sources of guidance, see Appendix B. 
Related Studies 
A 2011 Government Accountability Office (GAO) report found that in 2008, 
children in foster care in five selected  States were prescribed psychotropic drugs, 
including antipsychotic drugs, at higher rates than children not in foster care. 20   
The GAO report states that the higher rates of usage do not necessarily indicate 
inappropriate prescribing practices and notes that these higher rates could be due 
to the greater mental health needs of children in foster care and the challenges of 
coordinating their medical care.  According to the GAO report, hundreds of 
children in the selected States had drug regimens consisting of five or more 
psychotropic drugs, although there is no medical evidence to support the 
concurrent use of this many drugs in children. 
____________________________________________________________ 
18 CERTs and MMDLN are both  funded by the Agency for Healthcare Research and  Quality.  The 
16 States were Alabama, California, Colorado, Illinois, Indiana, Maine, Massachusetts, Missouri, 
New Hampshire, New York,  Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, and 
Washington.  Of these, California, Illinois,  New York, and Texas are among the five States 
included in this evaluation.  
19  Antipsychotic Medication  Use in Medicaid  Children and  Adolescents:  Report and Resource 
Guide From a 16-State Study.  MMDLN/Rutgers CERTs Publication No. 1, June 2010.  
20 The five States included in GAOs study  were Florida, Massachusetts, Michigan, Oregon, and 
Texas.  The children studiedboth those in  foster care and not in  foster  carewere enrolled in 
the Medicaid programs of the five States.  GAO, Foster Children:   HHS Guidance Could  Help  
States Improve Oversight  of Psychotropic Prescriptions (GAO-12-201), December 2011. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       5    
   
In 2011, OIG released a study on elderly nursing home residents use of SGAs.  
This study determined that 14 percent of elderly nursing home residents had 
Medicare claims for SGAs.21  Eighty-three percent of Medicare claims for SGAs 
for elderly nursing home residents were associated with off-label conditions, and 
88 percent were associated with the condition specified in the FDA boxed 
warning (i.e., dementia).   
METHODOLOGY 
State Selection 
We purposively selected five States for inclusion in this evaluation:  California, 
Florida, Illinois, New York, and Texas.  These States were selected because they 
represented approximately 39 percent of total Medicaid payments for SGAs in 
2011.22     
From these five States, we collected all fee-for-service Medicaid-paid claims for 
SGAs prescribed to children aged 017 years old between January 1 and 
June 30, 2011.23  We also collected information from each State regarding which 
children were enrolled in foster care and information on the States drug coverage 
policies.    
To reduce the overall sample size, answer specific questions, and achieve precise  
estimates, we stratified the population into four groups based on foster care 
enrollment and payment amount.  We selected a stratified random sample of 
687 claims.  For a presentation of the stratified sample and detailed 
methodological information, see Appendix C.  For detailed descriptive 
information on the population of claims and the sampled claims, see Appendix D. 
Development of Criteria for Medical Record Review. Because there are no  
Federal Medicaid requirements defining appropriate use of SGAs to treat 
children, we reviewed existing guidance and literature to identify criteria for 
determining whether quality-of-care concerns were present in childrens treatment 
with SGAs. (Specifically, we reviewed all of the sources listed on pages 4 and 5 
except for the HEDIS 2015 measures, which at the time had not yet been 
published.)  We identified seven criteria related to quality of care in the treatment 
of children with SGAs; each criterion is supported by at least three of the sources  
____________________________________________________________ 
21 OIG,  Medicare Atypical  Antipsychotic  Drug Claims for Elderly Nursing  Home Residents  
(OEI-07-08-00150), May 2011. 

22 The 39-percent figure is based  on 2011 claims data from the Medicaid Statistical Information 
 
System (MSIS). 
 
23 The claims data collected included  only fee-for-service claims.  Initial discussions with 

Medicaid staff indicated that three of the five selected States had no managed-care coverage of
  
SGAs for children during our  review  period.  The other two  States indicated that managed-care 

coverage of these drugs for children represented a  very small percentage of paid claims  for drugs 

in  the review period. 

SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       6    
   
of guidance previously described.  Table 2 describes each of the seven 
quality-of-care criteria we identified and shows which of the sources of guidance 
and information that we reviewed address the issue.24   
Table 2: Descriptions of and Support for Medical Record Review  Criteria and Corresponding 
Quality-of-Care Concerns  
Source  
AACAP  Report and 
Criterion   ACF  Florida Utilization  Texas Utilization 
Practice  Resource 
Memo  Guidelines  Guidelines 
Parameter  Guide  
Dosage (wrong dose)  X  X  X  X  X 
Duration (taken too long)   X  X     X   
Indications for use (wrong treatment)   X     X  X  X 
Monitoring (poor monitoring)   X  X  X    X 
Polypharmacy (too many  drugs)   X  X  X  X  X 
Patient age (too young)      X  X  X  X 
Side effects   X  X  X  X  X 
Source:  OIG analysis of guidance documents, 2014.  
Review of Medical Records and Claims Data 
The psychiatrists who performed the medical reviews were board-certified child 
and adolescent psychiatrists with extensive experience and expertise in treating 
children with mental health conditions.  To ensure a consistent interpretation of  
the seven criteria, we provided the contracted psychiatrists with the same sources 
of guidance and information that we used to develop the criteria.  The contracted 
psychiatrists determined whether quality-of-care concerns existed in each childs  
SGA treatment, assessing each of the seven criteria using their clinical experience 
and judgment.  They also identified the diagnosis/diagnoses or indication(s) that 
the SGAs were prescribed to treat. OIG staff used this diagnosis information, as 
well the childrens ages, to determine whether the drugs were prescribed for 
medically accepted indications.   
We received records for 485 of the 687 sampled claims for an overall weighted 
response rate of 75 percent. The remaining 202 claims were undocumented or 
insufficiently documented, or the providers could not be located to request the 
records. Specifically, we could not locate or contact the providers or facilities 
that had custody of the medical records for 170 sampled claims.  Although we 
____________________________________________________________ 
24 Because the new HEDIS measures regarding the  use of antipsychotic drugs by children had not 
been published at the time of our review, we could not include them in the sources of guidance we 
used to develop the medical record  review criteria. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       7    
   
were able to contact the providers, we did not receive any medical records for 
7 sampled claims, and we received insufficient medical records for an additional 
25 claims.  See Appendix C for details on the response rates and a nonresponse 
analysis.  
Limitations 
It is possible that the children in our sample received SGAs that were not paid for 
by Medicaid; therefore, these childrens use of SGAs may be underestimated.  
Additionally, the psychiatrists reviews were based solely on the medical record 
documentation received; some of the quality-of-care concerns identified could be 
the result of poor documentation rather than poor quality of care.   
Standards 
This study was conducted in accordance with the Quality Standards for Inspection 
and Evaluation issued by the Council of the Inspectors General on Integrity and 
Efficiency.  
   
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       8    
   
FINDINGS 
In the five States studied, quality-of-care concerns were 
identified in the medical records for 67 percent of claims for 
SGAs prescribed to children 
Quality-of-care concerns were identified in the medical records associated with 
67 percent of claims for SGAs prescribed to children; two or more quality-of-care 
concerns were identified in the medical records for 49 percent of claims.  Chart 1 
below illustrates the percentages of claims for which concerns related to each 
medical record review criterion were identified in medical records; see Table D-5 
in Appendix D for estimated totals and percentages of claims with each 
quality-of-care concern. See Appendix E for all estimates and 95-percent 
confidence intervals for projections. 
Chart 1:  Percentages of  Medicaid Claims With Quality-of-Care Concerns 
Regarding Childrens Use of SGAs in 2011  
 
Medical reviewers  identified multiple quality-of-care concerns for many claims.  
 
Source:  OIG analysis of Medicaid claims in five States, 2014. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       9    
   
Medical reviewers identified many specific concerns related to each of the seven 
criteria for the medical record review.  Below are four case studies that illustrate 
some of the quality-of-care concerns that medical reviewers identified regarding 
each criterion. 
Case Study 1  a 10-year-old child diagnosed with ADHD  
MonitoringThe medical record lacked documentation of monitoring for side 
effects, including a lack of recognition of or monitoring for akathisia.25  
Indications for use (wrong treatment)This childs  ADHD was clearly 
documented as being treated with a stimulant medication, but there was no 
documented reason for the childs treatment with the SGA.   
Polypharmacy (too many drugs)This child was prescribed three psychotropic 
drugs during the review period, one of which was an SGA. 
Duration (taken too long)The medical reviewer stated:  The [SGA] should 
have been tapered down and possibly discontinued completely. 
Dosage (wrong dose)This child presented symptoms that appeared to worsen 
with the prescribed course of treatment with the SGA.  When the dosage of the 
SGA was increased, the childs symptoms  worsened.  The pattern of increasing 
dosage and worsening symptoms was repeated several times throughout the 
review period. 
Side effectsThe medical reviewer stated:  It is very possible the [SGA] caused 
the side effect of akathisia, and increasing the dosage caused the patient to get 
worse instead of better.  
Case Study 2  a 4-year-old child diagnosed with ADHD and a mood disorder  
MonitoringThere was no evidence in the childs medical records of any 
monitoring while the child was taking the sampled SGA.   
Indications for use (wrong treatment)This child was placed in the custody of 
child protective services at 4 weeks old and had a history of abuse and neglect and 
severe psychosocial issues, such as aggression, anxiety, and mood swings.  The 
reviewer stated that individual, family, and behavior therapy should have been 
attempted before initiating treatment with drugs.  However, there was no evidence 
in the childs medical record indicating that such therapies were attempted. 
Polypharmacy (too many drugs)This child was prescribed four psychotropic 
drugs during the review period, of which two were SGAs. 
____________________________________________________________ 
25 Akathisia is a pathologic condition characterized  by restlessness and agitation,  such as an  
inability to sit still, and is a common side effect of many SGAs.  Mosbys Medical Dictionary, 
7th  Ed. Mosby-Elsevier, 2006. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       10    
   
Dosage (wrong dose)The reviewer noted that there is no appropriate dosage of 
the prescribed SGA for this childs conditions.   
Age (too young)The reviewer stated that treatment with SGAs was not 
appropriate for a 4-year-old. 
Case Study 3  a 16-year-old child diagnosed with bipolar disorder    
MonitoringThis child experienced significant weight gain while taking the 
SGA, but there was no evidence in the childs record of monitoring of blood 
sugar, cholesterol, or other hormone levels in response to the weight gain.  
Indications for use (wrong treatment)The reviewer stated that the diagnosis 
which the SGA was prescribed to treat was poorly documented, saying, Multiple 
antipsychotic agents were used with vague documentation of hallucinations [as 
the only explanation]. 
Polypharmacy (too many drugs)This child was prescribed a total of six 
psychotropic drugs during the review period, of which three were SGAs.   
Duration (taken too long)The SGA was prescribed to this child in response to 
a report of hallucinations. However, the medical reviewer stated:  When all 
medications were discontinued... hallucinations were not reported nor was the 
patient reporting suicidal ideation [i.e., suicidal thinking].  The SGA should have 
been discontinued as soon as it became  apparent that its side effects were 
outweighing any treatment benefit.  
Side effectsThis child experienced paranoia, hostility, unstable mood, 
hallucinations, and suicidal thoughts. This child also experienced significant side 
effects potentially resulting from the  prescribed drugs, including a 22-pound 
weight gain, insomnia, and edema (swelling) of hands and feet.   
Case Study 4  a 16-year-old child diagnosed with bipolar disorder and ADHD   
MonitoringAlthough the childs medical record indicated that laboratory 
testing was performed, there were no notes in the record of the results of that 
testing. The medical record also lacked any evidence of monitoring of the childs  
height, weight, or vital signs. 
Polypharmacy (too many drugs)This child was prescribed a total of six 
psychotropic drugs during the review period, of which two were SGAs. The 
medical reviewer noted that although the regimen of six psychotropic drugs might 
have been beneficial in treating the childs diagnoses, the medical record lacked 
documentation to support why any of the drugs were chosen to treat the child and 
the symptoms these drugs were targeting. 
Dosage (wrong dose)This child was prescribed double the maximum 
recommended dosage of the SGA to treat bipolar disorder.   
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       11    
   
Lack of monitoring was the most commonly identified quality-of-care 
issue    
In the five States we reviewed, quality-of-care concerns regarding lack of 
monitoring were identified in the medical records for 53 percent of claims for 
SGAs prescribed to children. Reviewers were concerned about a lack of 
monitoring for many physiological and behavioral changes.  They especially 
noted that the following were not being regularly performed:  measuring of 
height, weight, vital signs, and blood pressure; measuring of abnormal 
involuntary movements; laboratory testing (e.g., tests of liver function, measures 
of blood glucose levels, measures of lipid levels); and electrocardiograms.  In all 
four case studies described above, reviewers identified a lack of monitoring, 
including a failure to recognize or manage side effects, such as akathisia, 
significant weight gain, insomnia, and edema.   
In the five States studied, 8 percent of SGAs were 
prescribed for the limited number of medically accepted 
pediatric indications 
Eight percent of claims for SGAs were for drugs prescribed for the limited 
number of medically accepted pediatric indications.  As noted in the background, 
there are only five SGAs with medically accepted pediatric indications; most of 
those indications are limited to specific age ranges for each drug.  Furthermore, 
physicians are not prohibited from prescribing SGAs for indications that are not 
medically accepted.  See Table 3 for a list of medically accepted pediatric 
indications of SGAs. 
Among the 92 percent of claims that were not prescribed for medically accepted 
pediatric indications, common diagnoses that SGAs were prescribed to treat were 
bipolar disorder (20 percent), mood disorders (13 percent), and autism spectrum  
disorders (8 percent).26 
   
 ____________________________________________________________ 
26 Although there are medically accepted indications for certain drugs  to treat bipolar disorder and 
autistic disorder, the children who were prescribed these drugs for nonmedically accepted 
indications were (1) not in the age range specified and/or (2) were not  diagnosed with the 
symptoms specified.  For example, a child  diagnosed with  bipolar disorder may not have had 
mania or mixed episodes; a child  diagnosed with  autistic disorder may not have  had irritability.  
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       12    
   
Table 3: Medically Accepted Pediatric Indications for SGAs  
SGA   Medically  Accepted Pediatric Indication(s)1  Age  Range  
Schizophrenia  1317 years  
Mania or mixed episodes associated with bipolar I 
aripiprazole  1017 years  
disorder2   
Irritability associated with autistic disorder    617 years  
Schizophrenia  1317 years  
olanzapine 
Mania or mixed episodes associated with bipolar I disorder   1317 years  
paliperidone  Schizophrenia  1217 years  
quetiapine fumarate  Schizophrenia  1317 years  
  Mania associated with bipolar I disorder   1017 years  
Schizophrenia  1317 years  
Mania or mixed episodes associated with bipolar I disorder   1017 years  
risperidone   Irritability associated with autistic disorder    516 years  
Behavioral syndrome-mental retardation   --3  
Pervasive developmental disorder   --3  
1Medically accepted indications include both the uses approved by FDA and those uses, including off-label uses, 
supported by one or more of the compendia.   
2 Bipolar disorder is a brain disorder that causes unusual shifts in mood, energy, activity levels, and the ability to  
perform daily tasks.  There are two primary forms of bipolar disorder:  bipolar I disorder and bipolar II disorder.   Each 
of these two types of bipolar  disorder have distinct and separate symptoms. 
3The FDA-approved uses for risperidone have specific age ranges; the compendia-supported indications do not have  
specific age ranges, but are simply noted as pediatric use.  
Source:  OIG analysis of  compendia information, 2014. 
 
New York had a coverage policy stating that its Medicaid program would pay 
only for SGAs prescribed for medically accepted indications.  However, at least 
3,366 claims totaling $773,607 were paid in violation of this policy.27  New York 
State Medicaid staff told us that because of the lack of diagnosis information on 
drug claims, this coverage policy is difficult to enforce without conducting a 
medical record review. 
Over a third of SGAs were prescribed for conditions described in the 
FDA boxed warning  
For drugs that may have severe or life-threatening risks when used to treat 
patients with specific conditions, FDA may require that the products labeling 
____________________________________________________________ 
27 To determine whether a drug is prescribed for a medically accepted pediatric indication, we 
must know the diagnosis it was prescribed to treat.  However, diagnosis information is not  
included in  drug claims data; it is available only from  medical records.  To identify claims that did  
not meet New Yorks coverage policy,  we identified all the claims in New Yorks population data 
that were for the five SGAs that have no medically accepted pediatric indications:  aripiprazole, 
paliperidone, risperidone, quetiapine  fumarate, and  olanzapine.  There could  be additional claims  
in the population data that were not prescribed for medically accepted pediatric indications and 
thus violate New Yorks coverage policy but that we cannot identify without diagnosis 
information and/or medical review.  
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       13    
   
include a boxed warning describing those risks.  Three of the SGAs included in 
this evaluation carried an FDA boxed warning describing the increased chance of 
suicidal thinking and behavior in children, adolescents, and young adults with 
major depressive disorder and other psychiatric disorders being treated with these 
SGAs. However, physicians are not prohibited from prescribing a drug for a 
patient who has the condition(s) specified in the FDA boxed warning if the 
physician judges that the benefits may outweigh the risks.   
Thirty-seven percent of claims for SGAs were prescribed for conditions described 
in the FDA boxed warningi.e., for major depressive disorders and other 
psychiatric disorders. The language of the warningparticularly the phrase 
other psychiatric disordersis broad and could apply to almost any child with a 
mental health condition.  All children taking the three SGAs that carry this 
warning, regardless of their exact diagnoses or conditions, should be appropriately 
monitored for suicidal thoughts and other side effects.    
 
 
   
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CONCLUSION AND RECOMMENDATIONS 
SGAs are widely used to treat children enrolled in Medicaid who have mental 
health conditions. However, SGAs have been previously found to cause serious 
side effects and little clinical research has been conducted on the treatment of 
children with these drugs.  Quality-of-care concerns were identified in the medical 
records for 67 percent of claims for SGAs prescribed to children.  Lack of 
monitoring was the most commonly identified quality-of-care issue, being 
identified in just over half of the claims for SGAs.   
The high percentage of claims for which our reviewers identified quality-of-care 
concerns indicates that more needs to be done to ensure the quality of care 
provided to children receiving SGAs paid for by Medicaid.  To ensure the quality 
of the care provided to these children, we recommend that CMS work with State 
Medicaid programs to: 
Perform utilization reviews of SGAs prescribed to children 
Utilization reviews could specifically focus on the childrens age, the duration of  
their treatment with SGAs, and their overall drug regimens.  The previously 
described guidance and information on using SGAs to treat childrensuch as the 
utilization guidelines developed by the Florida and Texas Medicaid programs 
may be of use to CMS and to other State Medicaid programs in developing 
guidelines for such utilization reviews.  The medical review criteria that OIG 
developed for this evaluation may also be helpful in developing such guidelines. 
Conduct periodic reviews of medical records associated with claims 
for SGAs prescribed to children 
Periodic reviews of medical records could ensure that (1) there are clear rationales 
for prescribing the SGAs, (2) children are being properly monitored, and 
(3) childrens dosages are properly adjusted. 
Consider other methods of enhanced oversight of SGAs prescribed 
to children    
Some of the other methods of enhanced oversight that CMS and State Medicaid 
programs could consider include: 
	   implementing peer review programs  through which prescribers encourage 
one another to improve quality of care and 
	   undertaking voluntary reporting of the HEDIS measures regarding 
childrens use of antipsychotic drugs or adopting the HEDIS measures in 
State oversight of SGAs. 
In addition to making these recommendations, we have forwarded to CMS the 
information on the undocumented claims identified in our sample, so that it may 
take appropriate action. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       15    
   
AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL  
RESPONSE 
CMS concurred with all three of our recommendations. 
In responding to our first recommendation, CMS stated that it would work with 
States through the Medicaid Drug Utilization Review Program to monitor 
childrens use of antipsychotic drugs and provide feedback to States regarding any 
quality-of-care concerns identified using the criteria we established.   
In responding to our second recommendation, CMS stated that it would encourage 
States with managed care programs to request that their External Quality Review 
Organizations conduct periodic reviews of medical records of children treated 
with SGAs. We suggest that CMS also consider methods of periodically 
reviewing medical records of children who receive SGAs paid through 
fee-for-service arrangements.  
In response to our third recommendation, CMS plans to take a number of actions.  
In general, CMS will: 
 	  share our report to spur conversation about how to promote safe treatment 
of children with SGAs, 
 	  promote best practices in appropriate oversight of treatment of children 
with mental or behavioral health issues, 
 	  use measures regarding the safe and judicious treatment of children and 
adolescents with antipsychotics, and 
 	  engage with other Federal agencies to improve access to screening and 
treatment for children with substance use or mental health disorders. 
We support CMSs effort to ensure quality of care in childrens treatment with 
SGAs and its commitment to engaging with Federal partners and other 
stakeholder organizations.  For the full text of CMSs comments, see Appendix F. 
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APPENDIX A 
FDA Boxed Warning Regarding Children on SGA Product Labeling 
Three SGAs carry an FDA boxed warning regarding suicidality when used by 
children, adolescents, and young adults who have major depressive disorders or 
other psychiatric disorders.  In recent years, FDA has approved these three SGAs 
to treat depression; therefore, the boxed warning has been applied to these SGAs 
and refers to their use as antidepressants.  The text of the warning, which is shown 
in Figure A-1, is the same for all three SGAs.28  
Figure A-1: SGA Boxed Warning Regarding Children  
Antidepressants increased  the risk compared  to placebo of suicidal thinking and 
behavior (suicidality) in children, adolescents, and young adults in short-term 
studies of major depressive disorder (MDD) and other psychiatric disorders.  
Anyone considering the use of [drug name] or any other antidepressant in a  
child, adolescent, or  young adult must balance this risk  with the clinical need.  
Short-term studies did not show an  increase in the risk of suicidality with  
antidepressants compared  to placebo in adults  beyond age 24; there was a  
reduction in risk  with antidepressants compared to placebo in adults aged 65 and 
older. Depression and certain  other psychiatric disorders are  themselves associated  
with increases in the risk of suicide.  Patients of all ages who are started on 
antidepressant therapy should be monitored appropriately and observed closely 
for clinical worsening, suicidality, or unusual changes in behavior. Families and  
caregivers should be advised of the need for close observation and communication  
with the prescriber.  [Drug name] is not approved for use in pediatric patients with  
depression [see WARNINGS AND PRECAUTIONS (5.2)]. 
   
 ____________________________________________________________ 
28 The name of the drug  has been elided  from the warning.  
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APPENDIX B 
Sources of Guidance and Information on the Use of SGAs To Treat 
Children 
To develop the criteria for the medical record review in this evaluation, we 
reviewed the following documents issued by Federal and State agencies and by 
professional psychiatric associations.29    
1. 	  AACAP practice parameter.   AACAPs practice parameter identifies 
practices that may reduce the use of ineffective and inappropriate 
medications.  These practices include conducting complete psychiatric and 
medical evaluations, developing treatment and monitoring plans, 
educating patients and their families about treatment and obtaining 
consent for treatment, using adequate dosages and durations of treatment, 
assessing responses to treatment, and providing a clear rationale for the 
use of polypharmacy.   
2. 	  ACF information memorandum.  On April 11, 2012, ACF released an 
information memorandum titled Promoting the Safe, Appropriate, and 
Effective Use of Psychotropic Medication for Children in Foster Care.30   
This memorandum identifies three outlier practices that may indicate 
that issues other than clinical need are influencing the prescribing of 
SGAs, including: 
	   Polypharmacy.   ACF identifies the following patterns as being of  
issue: use of three or more concurrent drugs, two or more concurrent 
drugs in the same class for more than 30 days, and use of multiple 
concurrent drugs before testing the effectiveness of a single drug. 
	   Dosages of drugs that are too high.   ACF notes that because so few 
SGAs have received FDA approval for pediatric populations, there are 
no recommended dosages for children for most SGAs.  They note that 
the lack of this information reinforces the need for effective 
monitoring of children receiving SGAs for off-label uses.  
	   Children being prescribed SGAs at too young an age.   ACF notes the 
dramatic rise in the use of SGAs among very young children and 
concludes that because this population may be especially vulnerable to 
adverse effects, careful management and oversight are necessary. 
 ____________________________________________________________ 
29 The guidance discussed here covers all  psychotropic drugsa category that includes SGAs and 
several other types of drugs.  Other classes of psychotropic drugs include ADHD drugs, 
antianxiety drugs, antidepressants, first-generation antipsychotics, hypnotics, and mood stabilizers.  
This study focuses specifically on SGAs. 
30 ACF,  Promoting  the Safe, Appropriate, and Effective Use of Psychotropic Medication for  
Children in Foster Care,  Log No. ACYF-CB-IM-12-03, April 11, 2012.  Accessed at 
http://www.acf.hhs.gov/sites/default/files/cb/im1203.pdf on  May 12, 2014. 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       18    
   
3. 	  Report and Resource Guide. The Rutgers University CERTs, the 
MMDLN, and 16 States collaborated in 2010 to produce a publication for 
State Medicaid programs and other stakeholders concerned with care of 
children and youth. This publication is entitled Antipsychotic Medication 
Use in Medicaid Children and Adolescents:  Report and Resource Guide 
From a 16-State Study.31 It contains background on issues about the use of 
antipsychotic drugs by children, data from the 16 States reflecting use of 
antipsychotic drugs by children, and information on how the 16 States are 
managing the use of antipsychotic drugs.32   Among the issues listed are 
polypharmacy, dosages, and the prescribing of antipsychotic drugs to very 
young children. 
4. 	  State utilization guidelines. State agencies in Florida and Texas have 
each developed utilization guidelines that can help identify when further 
review of the prescribing of SGAs to children is necessary.  Florida and 
Texas guidelines address concerns such as  polypharmacy (the concurrent 
use of multiple drugs), inadequate indications for use of drugs, excessive 
dosage, prescribing of drugs to very young children, and prescribing by a 
primary care provider who has not received previous specialty training.33  
NCQA publishes the HEDIS, a set of measures used to assess the performance 
of health plans.34  In July 2014, NCQA adopted the new measures for HEDIS 
2015 regarding the safe and judicious use of antipsychotics in children and 
adolescents; reporting on the new HEDIS measures will begin in June 2015.    
We did not use the HEDIS measures in developing our medical record review 
criteria because the measures had not yet been adopted.  We include 
information on the measures here to provide additional context to our 
____________________________________________________________ 
31  CERTs and  MMDLN are both  funded  by the Agency for Healthcare Research and Quality.  
The 16 States were Alabama, California, Colorado, Illinois, Indiana, Massachusetts, Maine, 
Missouri, New  Hampshire,  New York, Oregon, Oklahoma, Pennsylvania, Tennessee,  Texas,  and 
Washington.  Of these, California, Illinois,  New York, and Texas are among the five States we  
included in this evaluation.  
32  Antipsychotic Medication  Use in Medicaid  Children and  Adolescents:  Report and Resource 
Guide From a 16-State Study.  MMDLN/Rutgers CERTs Publication No. 1, June 2010.  
33 University of  South  Florida, Bipolar I Acute or Mixed Mania617 Years. Accessed at  
http://medicaidmentalhealth.org/ViewGuideline.cfm?GuidelineID=32 on  June  6, 2014.  University  
of South Florida, Principles of Practice Regarding the Use of Psychotropic Medication under 
Age 6. Accessed at http://medicaidmentalhealth.org/ViewGuideline.cfm?GuidelineID=32 on  
May 23, 2014.  Texas Department of Family and Protective Services, Psychotropic Medication  
Utilization  Parameters for Foster Children, December 2010. Accessed at 
http://www.dfps.state.tx.us/documents/about/pdf/txfostercareparameters-december2010.pdf on  
May 12, 2014.  Health Information Designs, Texas Prior Authorization ProgramClinical Edit 
Criteria:  Antipsychotics.  Accessed at https://paxpress.txpa.hidinc.com/antipsychotics.pdf on  
May 6,  2014. 
34 State Medicaid programs also report on the  HEDIS measures, but their HEDIS reporting is 
voluntary.  
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recommendations.  The HEDIS measures regarding the safe and judicious use 
of antipsychotics in children and adolescents are: 
   use of higher-than-recommended doses of antipsychotics in children 
and adolescents, 
   use of multiple concurrent antipsychotics in children and adolescents, 
   use of first-line psychosocial care for children and adolescents on 
antipsychotics, 
   followup visits for children and adolescents on antipsychotics,  
   metabolic screenings for children and adolescents newly on 
antipsychotics, and 
   metabolic monitoring for children and adolescents on antipsychotics.  
   
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APPENDIX C 
Detailed Methodology 
We stratified the sample by foster care enrollment, with the intention of 
determining whether there were differences in quality of care between children 
enrolled in foster care and those not enrolled in foster care.  However, we were 
unable to test for such differences because of the low response rate among the 
providers associated with the claims in the foster care stratum, as described in the 
section on response rates below.   We also stratified the sample by payment 
amount, in order to enhance the precision of our statistical estimates.  Table C-1 
provides details on the population and sample sizes by strata. 
Table C-1: Population, Strata, and Sample Size  
Stratum   Claims in Population   Claims in Sample 
Claims for children who were in foster care on the service date of 
49,058 147 
the claim 
Claims for children who were not in foster care on the service date 
of the claim and for which the paid amount was less than or equal  173,596   92 
to $187  
Claims for children who were not in foster care on the service date 
of the claim and for which the paid amount was greater than $187  99,419 267 
but did not exceed $557  
Claims for children who were not in foster care on the service date 
28,460   181 
of the claim and for which the paid amount was greater than $557  
Total   350,533  687 
Source: OIG analysis of 2011 MMIS claims data from five States, 2014. 
Identification of FDA-Approved Uses and Medically Accepted 
Indications  
To identify FDA-approved uses and medically accepted pediatric indications for 
the 11 SGAs, we obtained copies of the compendium publications that would 
have been the most recent available during our review period.35  Specifically, we 
obtained the 2011 version of the American Hospital Formulary Service Drug 
Information and the June 2011 DrugPoints. 36  
Collection of Medical Records  
We developed a letter for our medical review contractors use in requesting 
medical records from the prescribing providers identified on the sampled claims.  
____________________________________________________________ 
35 FDA-approved  uses are included in the definition of medically accepted indications and 

therefore are listed among the medically accepted indications in the compendia. 

36 The Act lists three compendia:  (1) American  Hospital Formulary Service Drug Information, 

(2) the  United States PharmacopeiaDrug Information (or its successor publications), and 
(3) DrugDEX Information System.  However,  we obtained copies of only the first and third  of  
these.  The second compendium listed in the Act, the United States PharmacopeiaDrug  
Information,  is no longer published.  Its successor publication is DrugPoints, which contains 
information derived from  DrugDEXthe third compendium.    
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For each of these providers, the contractor sent a letter requesting the medical 
records associated with the sampled claim(s).  If a provider did not respond to this 
initial letter, the contractor sent up to  two followup letters at predetermined time 
intervals. For providers that did not respond to the initial letter or two followup 
letters, the contractor followed up by telephone.  We considered any provider that 
had not submitted the requested records after being contacted at least five times 
(three letters and two telephone calls) to be a nonresponder.   
Response Rates  
Table C-2 shows how the response rate for the 485 claims for which we received 
medical records were distributed among the 4 strata.  Response rates varied by 
stratum.    
Table C-2: Response Rates by  Stratum 
Stratum  Response Rate  
Claims for children who were in foster care on the service date of the claim   62%  
Claims for children who were not in foster care on the service date of the claim 
80%  
and for which the paid amount was less than or equal to $187  
Claims for children who were not in foster care on the service date of the claim 
73%  
and for which the paid amount was greater than $187 but did not exceed $557  
Claims for children who were not in foster care on the service date of the claim 
69%  
and for which the paid amount was greater than $557 
Source:  OIG analysis of  sampled  claims and medical records received, 2014. 
Nonresponse Analysis  
Our findings are based on estimates made solely from medical records collected 
for the associated sampled claims.  We did not statistically adjust our results on 
the basis of any assumptions about nonrespondent claims.   
We performed a nonresponse analysis to determine the representation of 
subpopulations in respondent claims and to determine the extent of the potential 
nonresponse bias. We compared whether the respondents and nonrespondents 
differed with regard to two variables that are available for the entire population 
and that may be associated with response:  (1) foster care enrollment and (2) State 
of residence. We looked to see whether the response rates were significantly 
different at the 95-percent confidence level.  We estimated the proportion of 
respondent and nonrespondent claims within these variables and performed 
Rao-Scott chi-square tests of significance.   
We found significant differences in response rates for these two variables.  
Records for children in foster care were less likely to have been submitted 
(62 percent) compared with those for children not enrolled in foster care 
(77 percent).  Further, records for children residing in California were less likely 
to have been submitted (65 percent) compared to those for children residing in the 
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other four States (79 percent). Therefore, claims for children in foster care and 
claims from California are underrepresented among the respondent claims. 
Potential Effects of Nonresponse on Estimates. To explore the effects that the 
nonrespondent claims could have had on our results, we imputed and estimated 
the following: 
 	  the percentage of claims that would have had at least 1 quality-of-care 
concern if none of the 202 nonrespondent claims had had any 
quality-of-care concerns and  
 	  the percentage of claims that would have been for drugs prescribed for 
medically accepted uses if all of the 202 nonrespondent claims had been 
for drugs prescribed for medically accepted uses.  
If none of the 202 nonrespondent claims had had any quality-of-care concerns, the 
percentage of all claims with at least 1 quality-of-care concern would still have 
been at least 50 percent.  If all of the 202 nonrespondent claims had been 
prescribed for medically accepted uses, the percentage of all claims for drugs 
prescribed for medically accepted uses would have been approximately 
31 percent. See Table C-3 for 95-percent confidence intervals for these new 
estimates based on the assumptions of errors in the nonrespondent claims.  
Table C-3: Potential Effects of Nonresponse on Main Findings  
Sample  Point  95-Percent Confidence 
Estimate Description  
Size  Estimate   Interval  
Percentage of claims that would have had at least  
1 quality-of-care issue if none of the 202 claims for 
687  50.2%   44.7%55.6%  
which we  did not receive responses had had any 
quality-of-care concerns 
Percentage of claims that would have been for drugs 
prescribed for medically accepted uses if all of the 
687  31.5%   26.7%36.7%  
202 claims for which we did not receive responses had 
been for drugs prescribed for medically accepted uses 
Source:  OIG analysis of  sampled  claims and medical records received, 2014. 
Review of Medical Records  
Pretest of Medical Review Instrument. To test and refine the medical review 
instrument, we pretested it with six randomly sampled claims from the MMIS 
claims data from the selected States.  For the pretest, we requested medical 
records from the prescribing providers for the six sampled claims and asked the 
medical reviewers to complete the medical review instrument.  We then used the 
reviewers feedback to improve the medical review instrument. 
Determination of Medically Accepted Indications and Conditions Described in 
the FDA Boxed Warning.   Using (1) the diagnosis and behavior information that 
the reviewers compiled from the medical records, (2) the age of each child with a 
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sampled claim, and (3) the compendia information, we determined whether each 
claimed SGA was prescribed:  
 	  for medically accepted indications and/or 
 	  in the presence of conditions specified in the FDA boxed warning. 
Development of Medical Record Review Criteria.   Appendix B describes the 
documents we reviewed to determine medical record review criteria for whether 
childrens treatment with SGAs posed one or more quality-of-care concerns.  The 
criteria we identified include:   
	   DosageAll five documents support the idea that dosage needs to be 
appropriate. Specifically, they say that childrens treatment should start 
with the lowest effective dose; the dose should be adjusted and targeted; 
and the dosage should not exceed any recommended dosage guidelines, 
such as those for the FDA-approved uses. 
	   Duration of useThree of the five documents support the idea that 
treatment with SGAs should be of appropriate duration.  Specifically, they 
say that a dose reduction should be planned after several months of 
treatment, that the treatment plan should include a plan for discontinuing 
the drug, and that medication trials should be of adequate duration to 
assess the effects of the drug. 
	   Indications for useFour of the five documents support the idea that the 
prescribed drug should be consistent with the childs diagnosis.  The 
documents also say that there should be thorough and complete 
evaluations of all aspects of a childs condition and situationincluding a 
complete medical history and a psychiatric evaluationand that the target 
symptoms and diagnosis for each drug that a child is prescribed should be 
clearly documented.  In most instances, psychosocial interventions should 
be tried before starting treatment with drugs. 
	   MonitoringFour of the five documents support the idea that a 
monitoring plan should be developed before the child starts taking an 
SGA. The documents say that ongoing monitoring requires assessment of 
the childs clinical response to the drug; regular observation of 
physiological changes, such as in height, weight, vital signs, or changes in 
the results of bloodwork; and observation of any side effects experienced 
by the patient, such as involuntary movements, insomnia, and other 
physical and mental effects.  The documents also say that that lack of 
clinical drug trials and evidence-based data for pediatric uses of SGAs 
reinforces the need for close monitoring of children taking these drugs.   
 	  PolypharmacyAll five documents support the idea that treatment with 
a single drug should be tried before treatment with multiple drugs.  They 
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say that there needs to be a clearly documented rationale regarding the 
need for each drug when a child is treated with multiple drugs.   
 	  Side effectsAll five documents support the idea that the use of SGAs 
can have side effects.  Some sources outlined specific measures to monitor 
side effects, such as taking baseline and ongoing measures for height, 
weight, blood pressure, and body mass index, as well as measuring 
baseline and ongoing blood glucose and lipid levels. 
	   Patient ageFour of the five documents support the idea that the 
treatment of young children with SGAs should be rare and carefully 
managed.  Two of these four documents defined young children as those 
under 4 years of age, another defined them as those under 6 years of age, 
and the remaining document did not define an age. 
To ensure a consistent interpretation of the seven criteria, we provided the 
contracted psychiatrists with the same sources of guidance and information that 
we reviewed to develop the criteria. The psychiatrists reviewed the medical 
records for each sampled claim for an SGA and determined whether there were 
quality-of-care concerns about the childs  treatment with the SGA with regard to 
the seven criteria. Using their clinical experience and judgment, the psychiatrists 
described any concerns they identified about the childrens treatment with regard 
to any of the seven criteria. 
Determination of Violations of State Coverage Policies 
New York is the only State included in this evaluation that had a coverage policy 
based on the compendia.  New Yorks policy limits Medicaid coverage to drugs 
prescribed for medically accepted indications.  To determine the extent of 
compliance with this policy, we identified all New York claims in the population 
data that were for the five SGAs for which there were no pediatric medically 
accepted indications.     
 
   
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APPENDIX D 
Descriptive Data on Population and Sampled Claims 
Tables D-1 through D-3 present descriptive information on the population of 
claims, including the number of claims per State, each States foster-care 
enrollment, and the SGAs prescribed.  Table D-4 presents information on the 
types and specialties of the prescribing providers in the sample of claims.  Table 
D-5 presents estimates of the percentages  and total numbers of claims in the five 
States for which reviewers identified quality-of-care concerns. 
Table D-1: Number of Claims and Children in Population  
by State of Residence  
   
State   Number of Children  Number of Claims for 
With Claims for SGAs   SGAs in Population 
California  23,344   104,598  
Florida  7,016   26,990  
Illinois   15,704   74,329  
New York   15,919   67,429  
Texas   22,671   77,187 
     Total:   84,654   350,533  
Source: OIG analysis of population claims data from five State MSIS systems, 2014.  
 
Table D-2: Number of Children Enrolled in Foster Care With Claims in Population by State of  
Residence  
 
State   Number of Children  Number of Children  Number of Children With Claims  
With Claims While Not  With Claims While in  Both While in Foster Care and 
in Foster Care   Foster Care   While Not in Foster Care  
California  18,856   4,110   378 
Florida 6,673   281  62 
Illinois   13,960   1,635   109 
New York   13,463   2,456   0 
Texas   22,274   192  205 
     Total:   75,226 (89%)   8,674 (10%)   754 (1%)  
Source: OIG analysis of population claims data from five State MSIS systems, 2014.  
 
   
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       26    
   
The table below provides information regarding the total number and 
percentage of claims in the population for each of the 11 SGAs.  Three 
SGAsrisperidone, quetiapine fumarate, and aripiprazolerepresented 
nearly all claims in the population.  This high representation is not 
unexpected. These three SGAs were among the first SGAs to be approved 
by FDA. Additionally, these drugs are three of the five SGAs that have 
been approved by FDA for specific pediatric indications.  Furthermore, the 
FDA-approved indications for two of these drugsquetiapine fumarate 
and aripiprazolehave been expanded to include the treatment of  
depression associated with bipolar disorder and major depressive disorder.   
These factors likely contributed to the wider use of these three drugs over 
other SGAs. 
Table D-3: Claims in the Population by  SGA   
Total   Percentage of  
Drug  
Claims   Claims  
risperidone*  164,636   47.0%  
quetiapine fumarate*  91,830   26.2%  
aripiprazole  49,360   14.1%  
ziprasidone  21,924   6.3%  
olanzapine  17,832   5.1%  
paliperidone  1,650   0.5%  
clozapine   1,482   0.4%  
asenapine  1,296   0.4%  
olanzapine/fluoxetine  330  0.1%  
iloperidone  179  0.1%  
lurasidone  14  0.0% 
     Total:   350,533   100.0%  
*Includes an additional formulation, such as extended release, of  the  
drug. 
Source: OIG analysis of population claims data from five State MSIS 
systems, 2014. 
 
   
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       27    
   
Table D-4: Prescribing Provider Type for Sampled Claims  
Provider Type/Specialty   Percentage of  
Number in Sample  
Sample  
Psychiatrist 494  71.9%  
Nonpsychiatrist MD  129  18.8%  
Non-MD* 43  6.3%  
Unknown  21  3.0% 
     Total:   687  100.0%  
*Examples of non-MD prescribing provider types included nurse practitioners, 
physician assistants, prescribing psychologists, and social workers. 
Source: OIG analysis of sampled-claims data from five State MSIS systems and 
provider type and specialty information from  the National  Provider Identifier Registry, 
2014. 
 
  Table D-5:  Estimated Percentages of and Total Claims for SGAs with   
  Quality-of-Care Concerns for the Five States Reviewed  
Percentages of  Claims  Number of Claims 
Medical Record Review Criteria  
With Concern (n=485)*   With Concern  
Monitoring 52.8%   138,679  
Indications for use  40.6%   106,674  
Polypharmacy 37.3%   97,986  
Duration of treatment  34.1%   89,542  
Dosage 22.5%   59,123  
Patient age   16.7%   43,924  
Side effects  6.8%   17,773  
*Percentages do not total 100% because medical reviewers identified multiple quality-of-care  
concerns  for many claims. 
Source: OIG analysis of Medicaid claims data from five States and medical record reviews, 2014. 
 
   
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       28    
   
APPENDIX E 
Statistical Estimates and Confidence Intervals 
Table E-1: Sample Sizes, Point Estimates, and Confidence Intervals  
Sample  Point  95-Percent Confidence 
Estimate Description  
Size  Estimate   Interval  
Quality-of-Care Concerns (Percentages of Claims)  
Percentage of SGA claims with at least one quality-of-care 
485  67.0%   60.6%72.9%  
concern 
Percentage of SGA claims with multiple quality-of-care 
485  49.0%   42.5%55.5%  
concerns 
Percentage of SGA claims with quality-of-care concerns 
485  52.8%   46.3%59.3%  
related to monitoring 
Percentage of SGA claims with quality-of-care concerns 
485  40.6%   34.5%47.1%  
related to indications for use  
Percentage of SGA claims with quality-of-care concerns 
485  37.3%   31.3%43.8%  
related to polypharmacy 
Percentage of SGA claims with quality-of-care concerns 
485  34.1%   28.2%41.0%  
related to duration of treatment  
Percentage of SGA claims with quality-of-care concerns 
485  22.5%   18.0%27.8%  
related to dosage 
Percentage of SGA claims with quality-of-care concerns 
485  16.7%   13.0%21.3%  
related to patient age 
Percentage of SGA claims with quality-of-care concerns 
485  6.8%   4.2%11.0%  
related to side effects 
Medically  Accepted Indications and Boxed Warning  
Percentage of claims for SGAs prescribed for medically  
485  8.5%   5.2%13.6%  
accepted indications 
Percentage of claims for SGAs not prescribed for medically  
485  91.5%   86.4%94.8%  
accepted indications 
Percentage of claims for SGAs prescribed in the presence 
485  37.4%   32.3%43.0%  
of conditions listed in the FDA boxed warning  
Percentage of claims for SGAs that (1) were not prescribed 
for medically  accepted uses and (2) were prescribed to  459  20.1%   15.4%25.9%  
treat bipolar disorder  
Percentage of claims for SGAs that (1) were not prescribed 
for medically  accepted uses and (2) were prescribed to  459  13.0%   9.2%17.9%  
treat mood disorders 
Percentage of claims for SGAs that (1) were not prescribed 
for medically  accepted uses and (2) were prescribed to  459  8.4%   5.6%12.5%  
treat autism spectrum disorders  
continued on the next page  
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       29    
   
 
 
Table E-1: Sample Sizes, Point Estimates, and Confidence Intervals (Continued) 
Quality-of-Care Concerns (Numbers of Claims)  
Number of SGA claims with quality-of-care concerns 
485  138,679   119,568157,790 
related to monitoring 
Number of SGA claims with quality-of-care concerns 
485  106,674   88,875124,474  
related to indications for use  
Number of SGA claims with quality-of-care concerns 
485  97,986   80,469115,502  
related to polypharmacy 
Number of SGA claims with quality-of-care concerns 
485  89,542   72,442106,642  
related to duration of treatment  
Number of SGA claims with quality-of-care concerns 
485  59,123   46,05772,189  
related to dosage 
Number of SGA claims with quality-of-care concerns 
485  43,924   32,94454,905  
related to patient age 
Number of SGA claims with quality-of-care concerns 
485  17,773   9,11126,434  
related to side effects 
Source:  OIG analysis of  claims data and medical records, 2014. 
   
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       30   APPENDIX F 
Agency Comments 
.1-"P''~ 
(~J_"" 	
DEPAR1MENT OF HEALTH & HUMAN SERVICES  Centers for Medicare & MediCaid Services 
..
~....... 

Administrator 
Washington, DC 20201 
JAN  1"6 2015 
DATE: 
TO: 	 Daniel R. Levinson 

lnspectpr General 

FROM: 	 Marilyn Ta~enner 

Administrator 

SUBJECT: 	 Second-Generation Antipsychotic Drug Use Among Medicaid-Enrolled 
Children: Quality of Care Concerns OEI-07-12-00320 
The Centers for Medicare & Medicaid Services (CMS) appreciates the opportunity to review and 
comment on the above subject draft report. This study provides CMS with important new 
information to further our efforts to improve the quality of care provided to children with mental, 
developmental, and/or behavioral health problems. CMS is committed to working with states, 
other federal partners, and providers to address the significant quality of care issues identified in 
the report. 
As the draft report notes, during the period of January through June 30, 2011, the OIG examined 
medical records from a stratified random sample of 687 Medicaid fee-for-service paid claims to 
determine the extent to which second-generation antipsychotics (SGAs) prescribed to children 
enrolled in Medicaid in five selected states1 :  1) presented at least one quality of care issue; and 
2) were prescribed for medically accepted indications and/or prescribed despite the Food and 
Drug Administration (FDA) boxed warning. 
The OIG found that the medical records for 67 percent of claims for SGAs prescribed to children 
presented at least one quality of care issue in the five states reviewed.  Lack of monitoring was 
the most commonly identified quality of care issue; 53 percent of claims for SGAs prescribed to 
children lacked documentation of monitoring in the five States reviewed. Furthem1ore, only 8 
percent of SGAs were prescribed for medically accepted pediatric uses in the five states 
reviewed; over one-third of SGAs were prescribed for conditions described in the FDA black
boxwaming. 
CMS has been working over the past two years with its many partners, including the Medicaid 
Medical Directors Network (MMDN), as well as other federal agencies such as the 
Administration for Children and Families (ACF) and the Substance Abuse and Mental Health 
Services Administration (SNvfi-ISA), to strengthen oversight and monitoring ofpsychotropic 
medications use an1ong children. Examples of these efforts include: 
1 California, Florida, lllinois, New York, and Texas 
SGA Use Among Medicaid-Enrolled Children: Quality-of-Care Concerns (OEI-07-12-00320)  31   
   
 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)      32    
   
 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)      33    
   
 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)      34    
   
ACKNOWLEDGMENTS 
This report was prepared under the direction of Brian T.  Whitley, Regional 
Inspector General for Evaluation and Inspections in the Kansas City regional 
office. 
Michala Walker served as the team leader for this study.  Other Office of 
Evaluation and Inspections staff from the Kansas City regional office who 
conducted the study include Michael Barrett and Rae Hutchison.  Central office 
staff who provided support include Eddie Baker, Berivan Demir Neubert, 
Althea Hosein, Kevin Manley, Christine Moritz, Jessica Swanstrom, and 
Julie Taitsman, M.D. 
 
 
 
 
SGA Use Among Medicaid-Enrolled Children:  Quality-of-Care Concerns (OEI-07-12-00320)       35    
Office of Inspector General
http://oig.hhs.gov  
 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as  
amended, is  to protect the integrity of the Department of  Health and Human Services  
(HHS)  programs, as well as the health and welfare of beneficiaries  served by those 
programs.  This statutory mission  is  carried  out through  a nationwide network  of  audits, 
investigations, and inspections conducted by the  following operating components: 
Office of Audit Services 
The Office  of  Audit Services  (OAS) provides auditing services  for HHS, either by  conducting  
audits  with its own audit resources or by  overseeing  audit work done by others.  Audits  
examine the performance of HHS programs and/or its grantees and contractors in carrying  
out their respective responsibilities and are intended  to provide independent assessments of 
HHS programs and operations.  These assessments help reduce waste, abuse, and  
mismanagement and promote economy and efficiency  throughout  HHS. 
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The Office  of  Evaluation and Inspections (OEI)  conducts national evaluations to  provide 
HHS, Congress, and the public with timely, useful, and reliable information on significant 
issues.  These evaluations focus on preventing fraud,  waste, or abuse  and promoting  
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reports also present practical recommendations for improving program operations.  
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The Office of Investigations (OI) conducts criminal, civil, and administrative investigations  
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investigators working in all 50 States and the District of Columbia, OI  utilizes its resources 
by actively  coordinating with the Department  of Justice  and other Federal, State, and local 
law enforcement authorities.  The investigative efforts of OI often lead to  criminal 
convictions, administrative sanctions,  and/or  civil monetary  penalties.  
Office of Counsel to the Inspector General 
The Office of Counsel to the  Inspector  General (OCIG) provides general legal services to 
OIG, rendering  advice and opinions on HHS programs and operations and  providing all  
legal support for OIGs  internal operations.  OCIG represents  OIG in all civil and 
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enforcement authorities.