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New York Attorney General Letitia James announced that an agreement has been reached resolving allegations that Walgreens knowingly engaged in fraudulent conduct when it dispensed insulin pens.
According to James, “when filling insulin prescriptions, Walgreens did not always adhere to the dosage outlined by the prescribing doctor, but rather dispensed insulin pens in boxes containing five pens, regardless of the patient’s needs. This resulted in a pattern where Medicare and Medicaid beneficiaries were routinely receiving more insulin than prescribed and Walgreens was then billing Medicaid for the additional doses.”
As part of the settlement, Walgreens agreed to pay the United States and the states $209.2 million dollars. Of that, $89,185,625.10 will go to state Medicaid programs. The State of New York is set to receive $6,548,679.82.
James said that Walgreens repeatedly reported days of supply data to state Medicaid programs that were different from, and lower than, the days of supply calculated according to the standard pharmacy billing formula of dividing the quantity of insulin being dispensed by the daily dose.
As a result of this practice, Medicaid approved and paid a substantial number of claims submitted by Walgreens for refills that would not have been approved if Walgreens reported actual numbers. In recent years, New York’s Medicaid program paid an average of approximately $425 per box of five insulin pens to pharmacies on behalf of Medicaid beneficiaries.
The investigation was launched in 2015 when a whistleblower filed a lawsuit, James said.
“Cheating our state’s Medicaid program will never be tolerated by this office,” the AG said. “We will continue to root out illegal practices that increase costs of health care and medication for all New York Medicaid recipients, and will hold accountable any provider that engages in these deceptive practices.”
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