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CVS Health's pharmacy benefit manager, Caremark, has been ordered to pay nearly $290 million for overcharging Medicare for prescription drugs more than a decade ago. A federal judge in Philadelphia issued the order after Caremark was found liable in June for manipulating drug cost reports in 2013 and 2014. The case was brought to light by whistleblower Sarah Behnke, a former Aetna actuary, who accused Caremark of submitting false reports, leading to significant overbilling of Medicare Part D.
Chief Judge Mitchell Goldberg, appointed by former President George W. Bush, tripled the damages to $289.9 million, citing reckless disregard and deliberate ignorance by Caremark. The ruling also includes $4.87 million in civil penalties, and interest will accrue on the total amount until it is paid in full. Caremark plans to appeal the decision, arguing that the penalties are excessive.
The case highlights the ongoing scrutiny of pharmacy benefit managers and their role in the healthcare system. The U.S. Department of Justice intervened in the lawsuit, emphasizing the importance of accountability in Medicare billing practices. The outcome of this case could influence future regulatory actions and compliance standards in the industry.