MM Curator summary
[MM Curator Summary]: Add $236M to the tab that Centene is paying to unwind its PBM chapter.
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- Centene has agreed to pay New Mexico $13.7 million to settle allegations it overcharged the state’s Medicaid drug program.
- Centene was accused of allegedly “layering fees” and not passing on retail discounts to the state Medicaid program.
- As part of the settlement, Centene will provide pricing transparency on all pharmaceutical benefits and services provided to the state’s Medicaid program, New Mexico Attorney General Hector Balderas said Monday in a statement.
Centene, the nation’s largest Medicaid managed care organization, has settled a number of similar suits with a handful of states across the country.
The St. Louis-based insurer has agreed to pay more than $236 million to five other states, including Arkansas, Illinois, Mississippi, New Hampshire and Ohio, according to Healthcare Dive reports.
The settlement with New Mexico now brings the settlement total to nearly $250 million.
“This no-fault agreement reflects the significance we place on addressing their concerns and our ongoing commitment to making the delivery of healthcare local, simple and transparent,” Centene said in a statement.
Centene previously disclosed it had set aside $1.1 billion, what it called a “reserve estimate,” to resolve future potential settlements, according to a filing with the Securities and Exchange Commission last June.
The insurer plans to no longer operate a pharmacy benefit management firm in-house. It’s in the process of bidding out the $30 billion in annual pharmacy spend to a third party, and expects to award a contract by the year’s end, according to comments newly appointed CEO Sarah London made during the first quarter earnings call. It will also sell two separate pharmacy units in a $2.8 billion deal as it continues to review the potential sale of non-core assets.
In New Mexico, Centene provides care to 1 million residents and is known in the state as Centennial Care.
The attorney general’s office will continue its investigation of pharmacy benefit managers contracted with the state’s Medicaid program, the attorney general said, pointing to other agencies like the Federal Trade Commission, which has recently launched a separate investigation into the conduct of PBMs.