The Walgreens Boots Alliance has agreed to pay $269.2 million to settle two separate whistleblower lawsuits accusing it of civil fraud for overbilling federal healthcare programs for over ten years.
In the first suit, the chain will pay $209.2 million to resolve claims it improperly billed Medicare, Medicaid, and other federal programs from 2006 through 2017 for hundreds of thousands of insulin pens dispensed to patients known not to need them.
According to the settlement, Walgreens programmed its computer system to define a full box of five insulin pens as the minimum dispensing package size. This definition prevented Walgreens pharmacists from being able to dispense fewer than five pens even though a patient’s prescription called for fewer pens than a box of five.
With that action, Walgreens repeatedly reported information to state Medicaid programs different from, and lower than, the correctly calculated supply according to standard pharmacy practice and as required by state pharmacy laws. This resulted in state Medicaid programs paying for a substantial number of claims that the programs would not have approved if Walgreens had reported the correct supply of medication based on the prescription. This conduct also opened the door to potential healthcare risks and abuse, such as the improper resale of insulin pens on the Internet.
Discount Price Settlement
The other settlement resolves claims that Walgreens overcharged Medicaid from 2008 to 2017 by failing to disclose and charge the discount drug prices it offered the public through its Prescription Savings Club program. As a result, Medicaid programs paid Walgreens more in reimbursements than they would have had the PCS prices been disclosed. To resolve those claims, the company will pay $60 million.
Roughly $200 million will go to the federal government and $69.2 million to the individual state governments.
Corporate Integrity Agreement
Walgreens also entered a corporate integrity agreement with the Office of the Inspector General of the U.S. Department of Health and Human Services to ensure future compliance with federal healthcare programs. The CIA reaches broadly across Walgreens’ retail and specialty pharmacies that bill federal health care programs.
There seems to be a bit of discord over whether the company accepts responsibility, as the settlement agreements note that the company said it “admits, acknowledges, and accepts responsibility” for conduct alleged by the federal government, while in a separate statement, Walgreens said it “has admitted no wrongdoing,” and that the settlements were in the best interests of customers, patients and other stakeholders.