Centene reaches $72M settlement with Illinois, Arkansas for alleged Medicaid overcharges

MM Curator summary


2 more states have been paid out from the $1.1B settlement fund Centene set aside to deal with PBM scandal issues.


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Samantha Liss for Healthcare Dive

UPDATE: Oct. 1, 2021: Centene said in a statement: “We respect the deep and critically important relationships we have with our state partners. These no-fault agreements reflect the significance we place on addressing their concerns and our ongoing commitment to making the delivery of healthcare local, simple and transparent.”

Dive Brief:

  • Attorneys general for Arkansas and Illinois announced Thursday they both reached multi-million dollar settlements with Centene after the insurer allegedly overcharged their respective state Medicaid programs for prescriptions.
  • The alleged overages occurred after Centene subsidiary Envolve Pharmacy Solutions failed to disclose relevant discounts, Arkansas Attorney General Leslie Rutledge claims. Centene also improperly inflated dispensing fees, Illinois Attorney General Kwame Raoul alleged.
  • Centene will pay Illinois a total of $56.7 million in two installments over the next 12 months and $15.2 million to Arkansas in a similar arrangement.

Dive Insight:

The latest settlements come just months after Centene reached similar agreements in Ohio and Mississippi, in which the St. Louis-based insurer agreed to pay a total of $143 million to resolve allegations of overcharging the two states for medications.

The state of Ohio dropped its lawsuit against Centene as a result of the settlement. The payer did not admit fault in the settlements, but at the time the company set aside $1.1 billion to resolve future disputes in other states, according to a previous filing with the U.S. Securities and Exchange Commission.

In a series of tweets on Thursday, Rutledge explained that Centene’s Envolve was tasked with managing the state’s prescription drug program and was contracted to reimburse pharmacies, create preferred drugs lists and negotiate rebates with other pharmaceutical companies.

“When Envolve charged Arkansas Medicaid for the drugs, contracts required the costs to be capped by certain industry-standard prices, however Envolve charged Arkansas Medicaid more than the allowed price cap,” Rutledge tweeted.

Centene did not immediately respond to a request for comment.

Pharmacy benefit managers have come under fire in recent years for the opaque ways in which they operate and their role in rising drug costs. PBMs’ less-than-transparent business model has previously garnered scrutiny from lawmakers interested in tackling drug pricing reform.



Clipped from: https://www.healthcaredive.com/news/centene-72m-settlement-illinois-arkansas-overcharge-Medicaid-medicines/607535/