Walgreens Agrees to Pay $269 for Allegations It Overbilled for Different Drugs

Walgreens Boots Alliance Inc, according to a report by the federal Justice Department agreed, in January 2019, to the huge payout in response to charges it violated the Federal False Claims Act. The settlement, according to Law360, was one of the largest False Claims Act (FCA) settlements by a retail pharmacy in FCA history.

The False Claims Act was enacted during the Presidency of Abraham Lincoln. It has been amended on several occasions. The purpose of the act is to encourage whistleblowers to step forward and disclose acts of fraud against the government. Many individuals and companies try to cheat various government agencies including the Department of Defense, Medicare, and Medicaid. Common acts of fraud include overbilling, billing for unnecessary services, and even billing for services that were never rendered.

Whistleblowers are entitled to a percentage of any recovery if they make a proper disclosure and the disclosure helps in obtaining a judgment or a settlement. The disclosure must meet precise standards that an experienced workers’ compensation lawyer can explain. The percentage the whistleblower is paid depends on several factors such as whether the Department of Justice agrees to intervene or not.

The allegations in the Walmart case

There were two cases against Walmart that were filed by two former pharmacists of Walmart. The Department of Justice agreed to intervene in both cases.

  • Dispensing insulin pens. This was the larger case. Walgreens agreed to pay $209 million for overcharging for insulin pens. Diabetes patients need the pens to inject their insulin. Walgreens was charged with overbilling. It did so by billing for premature prescriptions – by placing a lower value than they should have on the number of treatment days that were covered by supplies of insulin pens. The practice wasn’t just fraudulent. It created a black market for these pens because patients got more pens than they needed. The black market, in turn, created a health risk because the pens weren’t being properly monitored
  • Overbilling Medicaid. For this charge, Walgreens agreed to pay $60 million. This settlement, like the insulin pen settlement, is believed to be one of the largest involving brick and mortar pharmacies. The charge against Walgreens was that it didn’t disclose discounted drug prices which it used in its Prescription Savings Club program (even though it previously settled another similar False Claims Act charge for Prescription Savings Club kickbacks))

What the whistleblowers received

The two whistleblowers in the insulin pen case were awarded 19% of their recovery – which amounted to $41 million. (19% of $209 million). The whistleblower in the Medicaid case was awarded $11.4 million which was also about 19% of the recovery.


False Claims Act charges against pharmacies seem to be on the rise because of the large quantities of prescriptions they handle. In this case, Walgreens denied wrongdoing even though it agreed to the huge settlement. Walgreens has also agreed to be bound by a compliance program to help prevent or limit similar wrongs.

 

Any pharmacist, healthcare professional, or individual who believes a health provider is defrauding the government may have the right to file a whistleblower claim. The attorneys at Stephen Danz & Associates have numerous offices throughout California to help you assert your rights. Please call us at 877-789-9707 to schedule an appointment and to learn if you have a whistleblower claim.