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Caremark to Pay $6 Million for False Claims Act Violations

Jaclyn Jaeger | October 2, 2014

Caremark, a pharmacy benefit management company, agreed last week to pay $6 million to the Department of Justice to resolve allegations that it violated the False Claims Act.

According to the allegations, Caremark knowingly failed to reimburse Medicaid for prescription drug costs paid on behalf of Medicaid beneficiaries, who also were eligible for drug benefits under Caremark-administered private health plans.

Under law, private insurers, rather than the government, must assume the healthcare costs for so-called “dual eligible” individuals, those who are covered by both Medicaid and a private health plan. If Medicaid erroneously pays for the prescription claim of a dual eligible, Medicaid is entitled to seek reimbursement from the private insurer or its PBM. 

Caremark served as the PBM for private health plans who insured a number of individuals...

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