By Jonathan Stempel
(Reuters) – Walgreens Boots Alliance has agreed to pay $106.8 million to settle charges that it fraudulently billed the U.S. government for prescriptions that were never filled, the Justice Department said on Friday.
The Justice Department said Walgreens violated the federal False Claims Act between 2009 and 2020 by submitting claims to Medicare, Medicaid and other health care programs for prescriptions it processed but never filled.
This resulted in the pharmacy chain receiving tens of millions of dollars for prescriptions it never provided to patients, the department said.
“Federal health care programs provide essential health services to millions of Americans,” said Brian Boynton, director of the Justice Department's civil division. “We will hold accountable those who abuse these programs by knowingly billing for goods or services they did not provide.”
Deerfield, Illinois-based Walgreens did not admit liability in agreeing to the settlement.
“Due to a software error, we inadvertently billed some government health care programs for a relatively small number of prescriptions that our patients submitted but never picked up,” Walgreens said in a statement.
“We corrected the error, reported the problem to the government and voluntarily refunded all overpayments.”
Friday's settlement resolves three whistleblower lawsuits filed in Florida, New Mexico and Texas.
The Justice Department said the payment took into account Walgreens' cooperation and its “significant” steps to improve its internal pharmacy management system to ensure billing problems do not occur again.
Walgreens previously reimbursed $66.3 million for the resolved claims and is being credited for this amount.
The chain recently operated about 8,600 stores in the United States, but said in June that it plans to close a significant number of underperforming stores in the coming years.
Steven Turck, a former Walgreens pharmacy manager who brought the Texas case, will receive $14.92 million from the settlement. Andrew Bustos, a former Walgreens district pharmacy supervisor who brought the New Mexico case, will receive $1.62 million.
Walgreens Boots (NASDAQ:) shares closed Friday up 37 cents, or 4.2%, at $9.21.
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