California announces settlement with health care company alleged to have defrauded Medi-Cal

(The Center Square) - As though in a repeat performance, California Attorney General Rob Bonta announced on Wednesday a settlement between the California Department of Justice and Centene Corporation, the largest managed care corporation for Medicaid.

A statement released by the DOJ said “California Department of Justice (DOJ) investigators found that between January 2017 and December 2018, California Health & Wellness and Health Net reported inflated figures for the costs they incurred in providing prescription drugs to patients. Centene leveraged advantages in its pharmacy benefit manager (PBM) contracts to save its managed care plans $2.70 per prescription drug claim over the two-year period. DOJ alleges that Centene and its PBM failed to disclose or pass on these discounted fees to Medi-Cal, which inflated fees and drug costs reported to California.”

The settlement agreement noted that the Centene Corporation “expressly deny liability, any wrongdoing and any violation of any federal or state statute…the Centene Corporation Recognizes the importance of providing high quality and and cost-effective pharmacy benefit services …and the state’s need for transparency around the costs associated services.” It further clarified stating, ”While the state does not dispute that the Centene Entities have provided pharmacy benefit services…and may be qualified to provide such services…the state requires full transparency ..around the cost and fees associated with those services.”

The agreement avoids uncertainties of litigation and is not “evidence of any liability or wrongdoing by one or more Centene Entities.”

“Today’s settlement is a win — it brings resources directly back to our state. At the California Department of Justice, we will continue using every tool we have to fight for California’s vulnerable communities,” Bonta said.

The settlement reflects full restitution to California’s Medi-Cal Program in the amount of $215,392,758.

“The claims resolved by the settlement are allegations only, and there has been no determination of liability,” a statement in the DOJ release said.