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July 22, 2015 Medicaid Fraud

NY Attorney General Settles with Walgreens Pharmacy Over Unlawful Medicaid Billing Allegations

With one of the most active and often-used state False Claims Acts, New York has once again taken aim at alleged misconduct within the healthcare industry. According to a recent announcement by the New York Attorney General’s Office, the popular Walgreens pharmacy and its subsidiary Trinity Homecare, LLC have reached a $2.5 million settlement with the state Office of Attorney General amid claims of intentional false billing for various prescription medications.

The case was commenced nearly six years ago by a former employee of Trinity Homecare.[1. “A.G. Schneiderman Announced $2.5 Million Settlement With NYC Pharmacy for Improper Medicaid Billings.” June 29, 2015.] While the amount of her whistleblower reward was not immediately disclosed, it is not uncommon for successful whistleblowers to receive up to 25-30 percent of the ultimate settlement or recovery amount.

Since the Medicaid program is dually-funded by the federal government, the state of New York will receive $1.48 million of the total settlement.

Details of the alleged false billing scheme

The majority of the claims involving false billing to Medicaid center around the following drugs: Advate, Alphanate, Benefix, Carimune-NF, Cerezyme, Feiba-VH, Flebogamma, Flebogamma-DIF, Gammagard, Gammagard-S/D, Gamunex 10%, Gamunex-C, Helixate-FS, Humate-P, Koate-DVI, Kogenate-FS, Mononine, Nabi-HB, Novoseven, Novoseven RT, Octagam 5%, Panglobulin, Polygam S/D, Privigen 10%, Recombinate, Refacto and Xyntha – all of which are used to treat the blood condition known as hemophilia.

According to the allegations, the drugs listed above are prescribed to patients in a cocktail formulation and delivered to homebound patients via delivery by Trinity Homecare. The drugs are then administered via infusion, and cost over $10,000 per delivery.

Allegedly, Medicaid patients prescribed the hemophilia cocktail were sent too many deliveries, were not notified about deliveries, or actually refused to accept extra deliveries. Nonetheless, the company continued to charge Medicaid for each shipment, even if the patient never received or declined to accept the drugs. In one particular case, the drugs were left in an apartment hallway and the patient was never actually notified that her medication was available.

Alarmingly, a staggering $2.5 million in alleged undocumented deliveries was reported by the AG’s office – for a total of just eight patients over a two year period.

New York authorities respond to the settlement

New York Attorney General Schneiderman said in a statement, “The rules are plain: Pharmacies that deliver drugs to Medicaid patients must document that the patient received that medication – and in the right amount….The hemophilia drugs dispensed and sent to patients in this case, per delivery, can cost as much as a new car. Overbilling that drains dollars from our important Medicaid program harms the most vulnerable New Yorkers. We cannot allow it.”

Contact a reputable whistleblower attorney today

If you are aware of fraud in the healthcare industry and would like to discuss your information with a reputable attorney, please do not hesitate to contact Berger Montague for a confidential and thorough review of your claim.