For Immediate Release - September 21, 2010

AG Coakley Secures $9.45 Million in Settlement with Long-Term Care Pharmacy Omnicare

BOSTON - Attorney General Martha Coakley's Office has entered into a settlement with Omnicare, Inc. after an investigation revealed that the company was overcharging the Massachusetts Medicaid Program. Under the terms of the settlement agreement, Omnicare will pay $9.45 million to resolve allegations that it overcharged MassHealth for prescription drugs supplied to residents of skilled nursing facilities in Massachusetts.

"The Massachusetts Medicaid Program provides critical health care services to thousands of Massachusetts residents," said AG Coakley. "Our office is focused on rooting out waste and abuse and recovering money on behalf of taxpayers to ensure that companies are not overcharging the state for prescription drug costs."

Omincare is a national long-term care pharmacy headquartered in Covington, Kentucky, and is a MassHealth provider. MassHealth provides funds for health care goods and services for eligible low-income individuals, including elder citizens, children and people with disabilities.

Today's settlement is based on a whistleblower lawsuit filed in federal court in Chicago on behalf of the United States, Massachusetts and other states. Attorney General Coakley's Medicaid Fraud Division undertook an extensive investigation that focused on allegations that Omnicare failed to follow MassHealth's pharmacy "usual and customary" pricing regulations, which require that pharmacies bill MassHealth at the lowest price which they charge or accept from a private third-party customer for the same drug.

The settlement agreement also requires Omnicare to comply with the usual and customary pricing regulations in the future. Omnicare cooperated with the Attorney General's Office during its investigation.

Since 2007, Attorney General Coakley's Office has recovered more than $165.6 million on behalf of the Commonwealth's Medicaid program.

This case was handled by Assistant Attorneys General Melissa Celli, Steven Hoffman and Christopher Walsh with the assistance of Investigators Anthony Megathlin and Ronald Velez, all of Attorney General Coakley's Medicaid Fraud Division, and with the assistance of the MassHealth Pharmacy Program.