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

Ohio Lawyer Typical Dave Yost submitted a lawsuit this 7 days towards health and fitness insurer Centene, alleging that enterprise subsidiary Buckeye Overall health Strategy used a net of subcontractors for the provision of pharmacy added benefits in order to misrepresent pharmacy expenditures, resulting in hundreds of thousands of pounds of overpayments by the Ohio Division of Medicaid.

Yost mentioned in a statement on Thursday that Centene materially breached its obligations to the condition Medicaid method and to the condition as a full, contacting it a “conspiracy” and a “sophisticated plan” to acquire Medicaid payments by way of misleading means.

The Ohio Division of Medicaid administers a health care aid approach that delivers coverage to about two.nine million Ohioans, and it does so by way of the use of Managed Care Businesses (MCOs), these kinds of as Buckeye Overall health Strategy, which administered its pharmacy advantage via sister providers Envolve Overall health Solutions and Overall health Web Pharmacy Solutions.

The exercise of subcontracting to more than just one Pharmacy Benefit Supervisor lifted queries about Buckeye Overall health Plan’s organization practices and, eventually, Centene’s.

The Business of the Lawyer Typical is alleging breaches of deal, including filing reimbursement requests for amounts previously compensated by third events failing to accurately disclose to ODM the legitimate price tag of pharmacy services, including the disclosure of special discounts received and artificially inflating dispensing costs.

As predicted, the lawsuit received pushback from Centene, precisely Envolve Overall health, which claimed the allegations are “unfounded” and pledged to aggressively protect its pharmacy services.

“Envolve’s pharmacy contracts with the Condition are reviewed and pre-approved by condition organizations right before they at any time go into effect,” the enterprise mentioned in a statement. “On top of that, these services saved hundreds of thousands of tax-payer pounds for Ohioans from current market-primarily based pharmaceutical pricing.”

The lawsuit was submitted underneath seal due to a confidentiality and nondisclosure agreement.

THE More substantial Development

In 2020, after incorporating 10 million associates, Centene noticed whole-year revenue of $111 billion, representing forty nine{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} development and adjusted diluted earnings for each share of $five, up thirteen{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} over the prior year.

Centene’s fourth quarter revenues were being $28.three billion, an increase of fifty{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} over the fourth quarter of 2019, and adjusted diluted earnings for each share were being $.forty six, compared to $.seventy three last year.

CFO, treasurer and govt vice president Jeff Schwaneke mentioned total revenues grew by $nine.4 billion over the fourth quarter of 2019 due to the acquisition of WellCare and development in the Medicaid and Overall health Insurance plan Marketplace organization. 

This development also consists of the affect from the suspension of Medicaid eligibility redeterminations and the reinstatement of the health and fitness insurer rate in 2020 – partly offset by the divestiture of Centene’s Illinois health and fitness approach and retroactive condition high quality-price adjustments and risk-sharing mechanisms.

In January, Centene and Magellan Overall health entered into a definitive merger agreement underneath which Centene will obtain Magellan Overall health for $two.two billion. As a end result of the transaction, Centene will establish just one of the nation’s premier behavioral health and fitness platforms throughout 41 million exclusive associates.

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