The attorneys general in Illinois and Arkansas on Thursday separately announced settlements with Centene Corporation, the largest Medicaid managed care organization in the United States, over inaccurate billing practices.
Centene Corporation will pay $71 million to settle allegations it overcharged the states of Arkansas and Illinois for medications in its Medicaid program.
The terms of the two settlements were announced separately by the attorney generals in Arkansas and Illinois. Centene will pay $56 million to the state of Illinois for submitting inaccurate billing requests as a pharmacy benefit manager (PBM) and $15 million to the state of Arkansas for overcharging for medications in its Medicaid program.
Centene previously reached a settlement with Ohio and Mississippi to resolve claims. Under the terms of those settlements, Centene agreed to pay $88 million to Ohio and $55 million to Mississippi.
As a PBM for Illinois’ Medicaid program, Centene subsidiary Envolve and other subsidiaries delivered pharmacy benefits to Illinois state agencies. The attorney general’s office determined that Centene allegedly submitted inaccurate pharmaceutical reimbursement requests that failed to accurately disclose the cost of pharmacy services. In addition, requests for reimbursement did not disclose available pharmaceutical discounts and improperly inflated dispensing fees.
“Pharmacy benefit managers are part of a larger issue, which is the accessibility and affordability of prescription drugs,” Illinois Attorney General Kwame Raoul said in a statement. “No one should have to choose between paying for basic necessities or costly but essential medications. My office is continuing to investigate pharmacy benefit managers operating in Illinois because I am committed to stopping unfair and unlawful conduct by PBMs and drug companies.”
In Arkansas, the attorney general said that Envolve inflated pharmacy costs by failing to disclose substantial discounts in ingredient costs and dispensing fees under its subcontract with CVS. This conduct by Envolve occurred in 2017 and 2018 and ended with termination of the Envolve-CVS subcontract.
“I have successfully fought predatory pharmacy benefit managers in the nation’s highest Court, and I continue to hold these providers accountable for gouging Arkansans with unreasonably high costs for their prescriptions,” said Arkansas Attorney General Leslie Rutledge. “I will always fight to protect Arkansans, and this settlement with Centene is a big step in repairing the damage it did by taking advantage of Arkansans.”
In addition to paying the $15 million, Centene agreed to provide Arkansas with full transparency related to the adjudication and payment of all pharmacy benefit claims, including the exact amount paid to the pharmacy for each pharmaceutical claim.