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Attorney General wins $94 million this year in Medicaid fraud recoveries

Release date: 11/4/2016

Latest case by Cooper’s Medicaid fraud team requires Omnicare to pay NC $350,000 

Raleigh: Nursing home pharmacy Omnicare will pay $28 million for Medicaid fraud including more than $350,000 to North Carolina, Attorney General Roy Cooper announced today. The case is one of dozens of Medicaid fraud cases successfully resolved by his office in recent months resulting in more than $94 million recovered this year for North Carolina.

“Nursing home residents and other vulnerable North Carolinians don’t deserve to be taken advantage of,” Cooper said. “We’re holding Medicaid cheaters accountable for harming patients and wasting tax dollars.”

In 2015-2016, Cooper’s Medicaid Investigations Division won 27 criminal convictions and 29 civil settlements and recovered $94.1 million for North Carolina in Medicaid fraud cases. The Attorney General’s Office has recovered more than $800 million total in Medicaid fraud cases in its history.

The civil settlement with Omnicare resolves allegations that between 2001-2008, it conspired with Abbott Laboratories through hidden kickback arrangements to promote the use of Depakote. Omnicare will pay North Carolina, other participating states and the federal government a total of $28.125 million to compensate Medicaid, Medicare, and other federal health programs.  North Carolina will receive $350,828.45 in restitution to the state’s Medicaid program and other recovery.

Depakote is a drug used to treat seizures, bipolar disorder and migraines. Omnicare delivers medicines to residents of nursing homes and assisted living facilities. It was purchased by CVS Health Corporation in 2015.

Pharmacists from companies like Omnicare are often hired by nursing homes and similar facilities to advise staff doctors on which drugs to prescribe their patients. According to the settlement, Omnicare consultants allegedly solicited and received kickbacks from Abbott in exchange for encouraging nursing home physicians to prescribe Depakote, which resulted in unnecessary prescriptions and false claims to Medicaid and other federal health programs.  Omnicare allegedly tried to hide its kickbacks—including payments, trips, and tickets to sports events—as grants or educational funding.

Medicaid is a joint federal-state program that provides health insurance for low-income individuals and people with disabilities. Cooper’s Medicaid Investigations Division prosecutes fraud, patient abuse and embezzlement in Medicaid-funded facilities.

A National Association of Medicaid Fraud Control Units (NAMFCU) Team participated in the investigation and conducted the settlement negotiations with Omnicare on behalf of the participating states. The North Carolina settlement agreement was reached by the Medicaid Investigations Division of the North Carolina Department of Justice and the North Carolina Division of Medical Assistance.

Contact:  Noelle Talley

Phone:     919/716-6413