Nursing Home Pharmacy Omnicare to Pay Millions for Medicaid Fraud

The civil settlement resolves allegations of hidden kickback arrangements

Nursing Home Pharmacy Omnicare to Pay Millions for Medicaid Fraud
Image: Pixabay
November 7, 2016

North Carolina Attorney General Roy Cooper stated that nursing home pharmacy Omnicare must pay $28 million for Medicaid fraud, including more than $350,000 to North Carolina.

"Nursing home residents and other vulnerable North Carolinians don't deserve to be taken advantage of," Cooper said. "We're holding Medicaid cheaters accountable for harming patients and wasting tax dollars."

The civil settlement resolves claims that the pharmacy conspired with Abbott Laboratories between 2001 and 2008 via hidden kickback arrangements to promote the use of Depakote, a medication for treating seizures, bipolar disorder, and migraines. The pharmacy will pay $28.125 million to the federal government, North Carolina, and other participating states in order to provide compensation to Medicaid, Medicare, and other federal health programs. In addition, the North Carolina's Medicaid program and other recovery, the state will receive restitution of $350,828.45.

Omnicare provides medications for nursing home and assisted living facility residents. CVS Health Corporation bought the company in 2015.

Nursing homes and similar facilities often hire pharmacists from such companies as Omnicare to provide advice to staff doctors on the drugs they prescribe to their patients. The settlement claimed that consultants from Omnicare requested and received kickbacks from Abbot as an exchange for encouraging physicians in nursing homes and similar facilities to prescribe Depakote, resulting in unnecessary prescriptions and untrue claims to Medicaid as well as other federal health programs. The company allegedly attempted to disguise the kickbacks—such as payments, trips, and sports tickets—as grants or other educational funding.