Kmart Settles Whistleblower Case About Inflated Prices

Kmart Corp. has agreed to pay $42 million to the federal government and several states to settle a whistleblower lawsuit jointly litigated by Phillips & Cohen LLP and Korein Tillery that alleged Kmart overcharged government healthcare programs and private insurers for generic prescription drugs. The “qui tam” (whistleblower) case filed in 2008 by former Kmart pharmacist James Garbe alleged that from 2004 to 2016 Kmart charged Medicare, Medicaid and Tricare as well as private insurers more for generic prescription drugs than it charged customers who paid cash. According to the whistleblower’s complaint, Kmart sold a 30-day supply of a generic version of a popular prescription drug for $5 to customers who registered for a discount program but Kmart sought reimbursement from the government for $152 for the same drug for Medicare customers, which Kmart claimed was the “usual and customary” price. Garbe worked for a Kmart pharmacy in Ohio when he discovered that Kmart was charging Medicare customers significantly more for generics than it was charging customers enrolled in its cash discount program. He had filled a personal prescription at the pharmacy and saw that Kmart claimed to his Medicare Part D insurer that the prescription cost $60 rather than the much lower price of $15 that it charged cash-paying customers in its discount program. Kmart argued in court that it could exclude the lower prices that it charged members of its discount program when determinin...
Source: Policy and Medicine - Category: American Health Authors: Source Type: blogs