CVS Does It Again!



Alabama Supreme Court on Friday allowed a class action lawsuit seeking more than $3 billion to go forward against CVS Health Corp and several insurance companies, agreeing with the ruling by a lower court which said the plaintiffs could be certified as a class.

 

The case dates back to a 1999 class action settlement for $56 million over alleged accounting fraud at MedPartners, a physician and pharmacy benefits management corporation.

 

CVS Health could not be reached for comment.

 

MedPartners became Caremark and merged in 2007 with CVS, now known as CVS Health.

In 2003, Alabama attorneys filed a lawsuit on behalf of a stockholder John Lauriello, alleging fraudulent insurance information was given in court by MedPartners and its insurers.

The plaintiffs allege that MedPartners and its insurers hid the fact that unlimited insurance coverage was available at the time of the initial class action in 1998, enabling them to settle for $56 million, instead of $3 billion in stockholder losses, according to court documents.

Stephani LeFlore Takes On CVS Pharmacy

CVS Pharmacy's Medicaid Fraud

 

 

CVS pays $17.5 Million to settle Medicaid Fraud
CVS, the giant retail pharmacy chain, has agreed to pay $17.5 Million to settle a whistleblower lawsuit accusing it of Medicaid fraud (“welfare fraud”).

THE FRAUD
According to her False Claims Acts lawsuit, CVS pharmacist Stephani LeFlore of Minnesota brought evidence to the government that CVS used a billing system for years that was designed to overbill Medicaid on prescription charges. Ms. LeFlore is represented by Minnesota attorneys Neil Thompson, Brian Wojtalewicz, Robert Christensen, and James VanderLinden, with local counsel Aaron Halstead of Madison, Wisconsin, where the case was filed in federal court.
It was done in relation to dual-eligible customers – those legitimately on Medicaid who also maintained their private health insurance coverage. The insurance coverages required CVS to charge the insurance company a smaller amount for prescriptions, and limited co-pay from the customer. When a person is allowed Medicaid coverage, the government always obtains an assignment of the person’s rights under their private health insurance coverage. The government essentially takes over the citizen’s rights under the coverage. This includes the common right to pay a smaller co-pay amount on prescriptions.
Ms. LeFlore claimed in her federal and state lawsuits that CVS should only have billed the Medicaid program the same limited co-pay on prescriptions that it would have normally billed the customer under the insurance plan. She alleged that CVS designed a billing software program for its pharmacies that consistently overcharged Medicaid on these co-pays. She claimed that these overcharges occurred on hundreds of thousands of prescription sales for well over five years.
The $17.5 Million settlement covers over-billings by CVS in the states of Minnesota, California, Massachusetts, Michigan, Florida, Indiana, Alabama, Nevada, New Hampshire and Rhode Island.
Ms. LeFlore first complained internally, but she was told by a supervisor that “corporate took care of the billing” and that she need not be concerned. She then retained her attorneys and commenced the False Claims Acts (qui tam) lawsuit in September, 2008. The lawsuit stayed under seal (non-public), according to the False Claims Acts and court orders, until the announcement of this settlement.
Ms. LeFlore and her attorneys will receive $2,595,460.00 as the reward under the federal and state False Claims Acts. They are also entitled to receive attorney fees from CVS.