Ohio AG sues Centene, alleging misrepresented pharmacy expenses cost Medicaid millions

Ohio Legal professional Normal Dave Yost filed a lawsuit this week towards wellbeing insurance company Centene, alleging that firm subsidiary Buckeye Wellbeing Prepare used a website of subcontractors for the provision of pharmacy positive aspects in buy to misrepresent pharmacy prices, ensuing in hundreds of thousands of dollars of overpayments by the Ohio Division of Medicaid.

Yost said in a assertion on Thursday that Centene materially breached its obligations to the condition Medicaid plan and to the condition as a full, contacting it a “conspiracy” and a “complicated plan” to receive Medicaid payments by way of misleading suggests.

The Ohio Division of Medicaid administers a clinical help system that presents coverage to about 2.nine million Ohioans, and it does so by way of the use of Managed Care Organizations (MCOs), these types of as Buckeye Wellbeing Prepare, which administered its pharmacy benefit through sister corporations Envolve Wellbeing Options and Wellbeing Internet Pharmacy Options.

The follow of subcontracting to much more than one particular Pharmacy Advantage Supervisor elevated issues about Buckeye Wellbeing Plan’s business procedures and, eventually, Centene’s.

The Workplace of the Legal professional Normal is alleging breaches of deal, which include submitting reimbursement requests for amounts currently compensated by 3rd functions failing to correctly disclose to ODM the accurate charge of pharmacy services, which include the disclosure of discounts been given and artificially inflating dispensing charges.

As expected, the lawsuit been given pushback from Centene, especially Envolve Wellbeing, which claimed the allegations are “unfounded” and pledged to aggressively defend its pharmacy services.

“Envolve’s pharmacy contracts with the Point out are reviewed and pre-accepted by condition businesses ahead of they ever go into influence,” the firm said in a assertion. “Moreover, these services saved hundreds of thousands of tax-payer dollars for Ohioans from industry-based pharmaceutical pricing.”

The lawsuit was filed underneath seal owing to a confidentiality and nondisclosure agreement.

THE More substantial Development

In 2020, soon after incorporating ten million users, Centene saw complete-calendar year profits of $111 billion, symbolizing 49% growth and modified diluted earnings for every share of $5, up 13% about the prior calendar year.

Centene’s fourth quarter revenues had been $28.three billion, an maximize of fifty% about the fourth quarter of 2019, and modified diluted earnings for every share had been $.46, in contrast to $.seventy three final calendar year.

CFO, treasurer and govt vice president Jeff Schwaneke said total revenues grew by $nine.four billion about the fourth quarter of 2019 owing to the acquisition of WellCare and growth in the Medicaid and Wellbeing Coverage Marketplace business. 

This growth also includes the impact from the suspension of Medicaid eligibility redeterminations and the reinstatement of the wellbeing insurance company cost in 2020 – partly offset by the divestiture of Centene’s Illinois wellbeing system and retroactive condition premium-fee changes and threat-sharing mechanisms.

In January, Centene and Magellan Wellbeing entered into a definitive merger agreement underneath which Centene will acquire Magellan Wellbeing for $2.2 billion. As a end result of the transaction, Centene will create one particular of the nation’s largest behavioral wellbeing platforms across 41 million exclusive users.

Twitter: @JELagasse
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