A pharmacy benefits manager exposed by a whistleblower for making more than 500 false claims has been slapped with a huge penalty.
The US District Court for the Eastern District of Pennsylvania has ordered pharmacy benefits manager Caremark to pay a colossal USD 289.9 million after finding it knowingly defrauded the Medicare programme. The decision, handed down on 19 August by Judge Mitchell Goldberg, imposed damages of USD 95 million and levied additional civil penalties for a staggering 513 false claims. The ruling follows an earlier liability finding in June, when the court determined that Caremark had misrepresented the costs that patients incurred for prescriptions at Walgreens and Rite Aid in 2013 and 2014. Relator Sarah Behnke brought the action under the False Claims Act (FCA). ‘Relator’ is the US term for whistleblowers who expose wrongdoing on behalf of the government.
Judge Goldberg concluded that the statutory requirements for both treble damages and per-claim penalties were satisfied. “Relator has proven actual damages of USD 95,000,000. Accordingly, I will treble that amount and award an additional USD 190,000,000 for a total of USD 285,000,000,” he wrote. He further determined that Caremark was responsible for knowingly causing the submission of the false reports to the Centers for Medicare and Medicaid Services (CMS), attracting penalties of USD 9,500 per report and totalling USD 4.87 million.
Ms Behnke’s complaint, filed more than a decade...
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