Omnicare, Inc., the leading US provider of medications for nursing home residents headquartered in Covington, KY, paid $21 million to settle allegations of Medicaid fraud in Massachusetts and Michigan. A whistleblower complaint stated that the company knowingly charged Medicaid more for drugs than it did private insurers.

The Commonwealth of Massachusetts received $9,450,000 and the state of Michigan $11,600,000. These are among a select number of states requiring that drug providers give Medicaid, the federal-state healthcare program for the poor, “most favored customer” pricing.  By ignoring these state laws, Omnicare allegedly collected hundreds of millions of dollars in illegal profits at taxpayer expense.

The whistleblower was a former Omnicare financial analyst, who will receive awards from both states for alerting them to the need for investigation.