Caremark LLC, a pharmacy benefit management company (PBM), agreed to pay $4.25 million to settle allegations that it knowingly failed to reimburse Medicaid for patients’ drug costs that should have been paid by Caremark-administered private health plans. When a patient is covered by both Medicaid and a private health plan, that patient is called a “dual eligible” and his/her health care costs must be assumed by the private insurer. According to the government, Caremark allegedly cancelled claims for reimbursement submitted by Medicaid for dual eligibles and caused Medicaid to incur their prescription drug costs.

Under the agreement, the federal government will receive approximately $2.31 million, and five states states–Arkansas, California, Delaware, Louisiana, and Massachusetts–will share $1.94 million. The case was originally filed by Janaki Ramadoss, a former Caremark quality assurance representative, who will receive approximately $505,680 from the federal government’s share of the settlement and additional amounts from the settling states.

Read entire press release, “CVS’ Caremark Will Pay $4.25 Million for Allegedly Denying Medicaid Claims for Reimbursement of Prescription Drug Costs”
Read our earlier post on the case, “Caremark Faces Growing Number of Qui Tam Suits”