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

Ohio Attorney Normal Dave Yost filed a lawsuit this 7 days against health insurance provider Centene, alleging that enterprise subsidiary Buckeye Wellness Program used a world wide web of subcontractors for the provision of pharmacy rewards in purchase to misrepresent pharmacy expenses, ensuing in hundreds of thousands of bucks of overpayments by the Ohio Division of Medicaid.

Yost reported in a statement on Thursday that Centene materially breached its obligations to the condition Medicaid application and to the condition as a complete, contacting it a “conspiracy” and a “sophisticated plan” to get Medicaid payments through misleading suggests.

The Ohio Division of Medicaid administers a medical aid system that presents protection to about two.nine million Ohioans, and it does so through the use of Managed Treatment Businesses (MCOs), this sort of as Buckeye Wellness Program, which administered its pharmacy reward by means of sister companies Envolve Wellness Options and Wellness Net Pharmacy Options.

The follow of subcontracting to more than 1 Pharmacy Profit Supervisor raised issues about Buckeye Wellness Plan’s company practices and, finally, Centene’s.

The Office of the Attorney Normal is alleging breaches of contract, including submitting reimbursement requests for amounts previously paid out by 3rd events failing to precisely disclose to ODM the real price of pharmacy services, including the disclosure of special discounts gained and artificially inflating dispensing costs.

As envisioned, the lawsuit gained pushback from Centene, especially Envolve Wellness, 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-authorized by condition organizations ahead of they at any time go into effect,” the enterprise reported in a statement. “Furthermore, these services saved hundreds of thousands of tax-payer bucks for Ohioans from sector-primarily based pharmaceutical pricing.”

The lawsuit was filed underneath seal due to a confidentiality and nondisclosure arrangement.

THE Larger Development

In 2020, following adding ten million members, Centene observed comprehensive-year profits of $111 billion, symbolizing 49{d5f2c26e8a2617525656064194f8a7abd2a56a02c0e102ae4b29477986671105} development and modified diluted earnings per share of $5, up thirteen{d5f2c26e8a2617525656064194f8a7abd2a56a02c0e102ae4b29477986671105} in excess of the prior year.

Centene’s fourth quarter revenues have been $28.three billion, an improve of fifty{d5f2c26e8a2617525656064194f8a7abd2a56a02c0e102ae4b29477986671105} in excess of the fourth quarter of 2019, and modified diluted earnings per share have been $.forty six, in comparison to $.seventy three previous year.

CFO, treasurer and executive vice president Jeff Schwaneke reported whole revenues grew by $nine.4 billion in excess of the fourth quarter of 2019 due to the acquisition of WellCare and development in the Medicaid and Wellness Insurance plan Market company. 

This development also includes the effect from the suspension of Medicaid eligibility redeterminations and the reinstatement of the health insurance provider price in 2020 – partly offset by the divestiture of Centene’s Illinois health system and retroactive condition quality-fee adjustments and possibility-sharing mechanisms.

In January, Centene and Magellan Wellness entered into a definitive merger arrangement underneath which Centene will receive Magellan Wellness for $two.two billion. As a consequence of the transaction, Centene will establish 1 of the nation’s major behavioral health platforms throughout forty one million unique members.

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