Dive Brief:
- Centene has agreed to pay the state of New Hampshire $21.1 million to settle allegations the company overcharged Medicaid for prescription drugs, New Hampshire Attorney General John Formella said last week.
- Following similar settlements in other states, New Hampshire initiated a review of Centene's pharmacy benefit services and found the St. Louis-based insurer reported inaccurate costs for pharmacy services that resulted in a financial hit to the state.
- The settlement covers a six-year period between Jan. 1, 2016, through the end of 2021. A national formula Centene has employed in other agreements was used in this case to determine the settlement total.
Dive Insight:
Centene has again inked a multimillion-dollar settlement deal with a state to resolve claims it overcharged for prescriptions in the state's Medicaid program. This is at least the fifth state Centene has reached a deal with, admitting no fault.
The payer has agreed to more than $236 million in settlements in five states, which now includes New Hampshire.
It's possible more settlements are on the horizon. Centene previously said it was setting aside $1.1 billion to resolve future potential settlements in other states, according to a filing with the Securities and Exchange Commission from last summer. However, the company cautioned "there is no guarantee" it will settle claims within the reserve estimate, according to another filing from last year.
"This no-fault agreement reflects our commitment to prompt and transparent resolution of this matter and relentless focus on delivering high-quality healthcare outcomes to our members in the Granite State," a Centene spokesperson said in a statement to Healthcare Dive.
Arkansas, Illinois, Ohio and Mississippi have all reached no-fault, multimillion-dollar settlements with the insurer, which specializes in government-sponsored programs such as Medicaid and Medicare. Centene is the nation's largest Medicaid managed care organization, providing coverage in 29 states to nearly 14.8 million Medicaid enrollees.
State | Settlement amount |
---|---|
Arkansas | $15.2 million |
Illinois | $56.7 million |
Mississippi | $55.5 million |
New Hampshire | $21.1 million |
Ohio | $88.3 million |
The alleged problem stems from Centene's pharmacy benefit manager subsidiary Envolve Pharmacy Solutions.
Envolve was responsible for reimbursing pharmacies, creating the drug formulary and negotiating rebates with drugmakers, Arkansas Attorney General Leslie Rutledge detailed in a series of tweets after a settlement there.
In Arkansas, Rutledge said Envolve charged Medicaid more than the contracted cap for drugs. In addition to the overcharges, Illinois alleged Envolve did not disclose available discounts and improperly inflated dispensing fees.
Centene has since announced that it plans to revamp its PBM business, with plans to contract out its whopping $35 billion annual pharmacy spend for its members. The company plans to launch an RFP process to find a third-party PBM this summer.