For Immediate Release - January 30, 2015

Billerica Pharmacy to Pay $1.5 Million Over Claims of Operating an Unauthorized Automatic Refill Program

BOSTON – A Billerica pharmacy will pay more than $1.5 million to settle allegations that it improperly billed and received payments from the state’s Medicaid program when it automatically refilled prescription medications that were not specifically requested by MassHealth patients or caregivers, Attorney General Maura Healey announced today.

Under the terms of the settlement, Neighborhood Diabetes, Inc. will pay more than $1.5 million in restitution to the Commonwealth for the overpayments, and be subject to additional reporting requirements to ensure compliance in the future.  

“We allege this pharmacy’s improper billing and refill practices resulted in unnecessary overpayments by MassHealth,” AG Healey said. “Our office is pleased that this resolution will provide restitution and requires compliance with state regulations.”

The investigation into the pharmacy’s refill and billing practices, conducted by the AG’s Office, determined that Neighborhood Diabetes, Inc., operating under the name of Neighborhood Pharmacy, implemented an “automatic refill” program which expressly violated MassHealth regulations. Current regulations prevent any pharmacy in the Commonwealth from refilling a prescription that was not explicitly requested by a MassHealth patient or caregiver at the time of each filling event.  

Under the terms of the settlement, Neighborhood Pharmacy has also agreed not to refill or bill for prescription medications without an explicit request from a MassHealth member or caregiver, or refuse to dispense drugs to any MassHealth member who is unable to pay a copayment at the time. Neighborhood Pharmacy is also required to comply with all applicable state and federal statutes, and provide annual training to its employees who provide pharmacy services.

The settlement is the second case in the Commonwealth to address a pharmacy’s operation of an improper automatic refill program with MassHealth members. In September 2013, AllCare Pharmacy in Worcester agreed to pay $1.6 million to settle similar allegations.

The matter was investigated by Assistant Attorney General Steven Sharobem, Investigator Christopher Cecchini and Investigator Aleksandra Andriyevskaya of Attorney General Maura Healey’s Medicaid Fraud Division, with assistance from MassHealth.