Ohio reaches $88.3 million settlement with company that set drug prices

Local News

COLUMBUS (WCMH) — A pharmacy benefit manager will pay Ohio $88.3 million to settle a lawsuit that alleged it overbilled the state’s Medicaid department.

The lawsuit, filed by state Attorney General Dave Yost, alleged that Centene Corp. and its subsidiary, Buckeye Health Plan, misrepresented the costs of pharmacy services and the price of prescription drugs.

“Centene used sophisticated moves to bill unearned dollars – moves known only at the top levels of health care companies,” Yost said. “It has taken a huge effort by my team to untangle this scheme — and now that we know how it works, the alarm bells should be ringing for anyone using similar tactics.”

According to a news release from Yost’s office, most Ohioans’ prescription-drug plans are under the management of a benefit manager through their health insurance. The benefit managers can control prescription-drug costs and decide which drugs are covered.

Yost began investigating pharmacy benefit managers in 2018, when he was state auditor, and found they were artificially inflating the cost of prescription drugs.

“Centene took advantage of all of us who pay taxes to care for the most vulnerable Ohioans,” Yost said. “This settlement is the big first step Centene is taking to repair Ohio’s trust, and it’s my hope they continue on this path of good faith.”

In addition to paying Ohio, Centene announced that it has reached a $55 million settlement with Mississippi, calling both settlements “no-fault agreements.” In a news release, the company said that in early 2019, it restructured its pharmacy benefit operations to make them more transparent.

“We respect the deep and critically important relationships we have with our state partners,” said Brent Layton, Centene’s president of health plans, markets and products. “These agreements reflect the significance we place on addressing their concerns and our ongoing commitment to making the delivery of healthcare local, simple and transparent.”

Centene said settlement negotiations continue with other states.

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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