North Carolina Department of Justice
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Attorney General Josh Stein Announces Nearly $1 Million Settlement with K-Mart over Medicaid Overbilling

Release date: 4/26/2018

(RALEIGH) Attorney General Josh Stein today announced a settlement with Kmart Corporation (K-Mart) over allegations that K-Mart charged the Medicaid program more than its usual and customary charge for certain drugs. K-Mart will pay North Carolina and the federal government $932,492.11.
“Overbilling for drugs is unacceptable,” said Attorney General Stein. “It cheats taxpayers and harms the Medicaid program – potentially keeping needed health care services from other people. My office will continue to fight against this type of abuse.”
In the mid-2000s, K-Mart began to offer discounted generic drugs to cash-paying customers through a variety of programs. It was alleged that K-Mart billed and received $5 from Medicaid for a prescription that cash-paying customers could purchase for $4. As a result of K-Mart’s actions, it received reimbursements from Medicaid, Medicare, and other federal programs that were higher than it was entitled to receive in violation of federal and state false claims statutes.

Laura Brewer (919) 716-6484