Walgreen Co. Agrees to Pay Over $2.8 Million to Settle Allegations of Overbilling Medicaid Programs

BOSTON – Walgreen Co. (Walgreens) has agreed to pay over $2.8 million to resolve allegations that it violated the federal, Massachusetts and Georgia False Claims Acts by submitting inflated prices for certain generic medications to the Massachusetts and Georgia Medicaid programs.    

The Massachusetts Medicaid program (MassHealth) and the Georgia Medicaid program are jointly funded and administered federal and state programs that cover medical costs, including medication costs, for persons with limited income. The MassHealth and the Georgia Medicaid program reimburse Walgreens’ pharmacies for dispensing generic medications to beneficiaries using the lowest of four reporting price points. One of the four price points is each pharmacy’s “usual and customary price,” which is generally the amount of money the pharmacy is willing to accept for a medication on that date of service.  

The United States, Massachusetts and Georgia allege that, between 2008 and 2023, Walgreens’ pharmacies submitted a higher usual and customary price to the MassHealth and Georgia Medicaid programs for certain generic medications at certain times. By failing to report the correct usual and customary price, Walgreens’ pharmacies allegedly caused the MassHealth and Georgia Medicaid programs to pay more for these generic medications than they should have.  

The settlement resolves, in part, claims brought by a whistleblower under the qui tam provisions of the federal, Massachusetts, and Georgia False Claims Acts. Under all three False Claims Acts, private parties may sue on behalf of the government and receive a share of a recovery.  

United States Attorney Leah B. Foley; Massachusetts Attorney General Andrea Joy Campbell; Georgia Attorney General Christopher M. Carr; and Roberto Coviello, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General made the announcement today. This matter is being handled by Assistant U.S. Attorney Steven Sharobem of the U.S. Attorney’s Office’s Affirmative Civil Enforcement Unit; Assistant Attorney General Ian Marinoff and Analyst Will Welsh of the Massachusetts Attorney General’s Office’s Medicaid Fraud Division; Assistant Attorney General Richard Tangum of the Georgia Attorney General’s Office, and Assistant Attorney General Heather D’Orazio of the Illinois Attorney General’s Office.