CVS Health’s pharmacy benefit manager, Caremark, was ordered to pay nearly $290 million amid accusations of fraud stemming from more than a decade ago, according to court documents obtained by FOX Business.
In June, Caremark was found liable of defrauding Medicare Part D by causing false drug cost reports to be submitted in 2013 and 2014, claims that were brought forward by whistleblower Sarah Behnke, who had worked as an actuary for Aetna. Philadelphia federal court Chief Judge Mtitchell Goldberg ordered the company to pay $95 million in damages and deferred final rulings on penalties before tripling the damages to a total of $289.9 million, as well as $4.87 million in civil penalties, on Tuesday (August 19).
“We are pleased that the Behnke ruling in June was in our favor as to certain issues for CVS Pharmacy and CVS Health Corporation’s liability and disappointed the court found against Caremark on other issues. We plan to appeal,” CVS wrote in a statement to FOX Business.
Caremark was accused of manipulating how drug costs were reported in 2014, which led to Aetna and SilverScript submitting false direct and indirect remuneration reports in 2013 and 2014, as part of a scheme to hide profits, resulting in Medicare Part D being overbilled by $95 million. Goldberg didn’t find “actual knowledge” of fraud, however, ruled that scheme resulted in reckless disregard and deliberate ignorance worthy of facing steep penalties, the memorandum states.
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