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Walgreens Accused of Overcharging Health Plans for Drugs (1)

March 16, 2022, 2:04 PMUpdated: March 16, 2022, 4:24 PM

Blue Cross and Blue Shield units and other health care plans allege that Walgreen Co. engaged in a fraudulent scheme to overcharge for prescription drugs by submitting claims for payment at inflated prices and made false statements to conceal the scheme.

Walgreens has overcharged the plaintiffs hundreds of millions of dollars, the plaintiffs said in a Tuesday complaint filed in the U.S. District Court for the Northern District of Illinois.

A spokesperson for Walgreens declined to comment.

When patients covered by the plaintiffs fill prescriptions at a Walgreens pharmacy, Walgreens submits electronic claims for reimbursement for those prescriptions through pharmacy benefit managers. Walgreens is required to accurately submit in those claims its “usual and customary” prices that cash-paying customers pay, the complaint says.

The U&C price acts as a reimbursement ceiling ensuring that the plaintiffs don’t pay more than cash-paying customers, the complaint says.

But Walgreens created a program under which it submitted U&C prices to the plaintiffs that were “five, ten, or twenty times higher” than what cash customers paid, the complaint says.

Walgreens knowingly and wrongfully overcharged the plaintiffs by submitting false and inflated U&C prices to the plaintiffs, the complaint says.

It also intentionally concealed from the plaintiffs the actual cash prices offered to members of the general public by making false statements and omitting material facts, the complaint says.

Cause of action: Fraud, fraudulent nondisclosure, unjust enrichment.

Relief: Damages.

Attorneys: L&G Law Group LLP and Stein Mitchell Beato & Missner LLP represents the plaintiffs.

The case is CareFirst of Md. Inc. v. Walgreen Co., N.D. Ill., No. 22-cv-1362, complaint 3/15/22.

(Updates third paragraph to show Walgreens declined to comment.)

To contact the reporter on this story: Daniel Seiden in Washington at dseiden@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Nicholas Datlowe at ndatlowe@bloomberglaw.com

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