Record $69 Million in Medicaid Fraud Recovered by AG Coakley’s Office in Fiscal Year 2011 – Offenders included CVS, Novartis, GlaxoSmithKline

$69 Million Recovered Represents Ratio Of $18 Returned To Taxpayers For Every Dollar In Division’s Budget

BOSTON – Continuing her office’s strong focus on rooting out fraud in the state’s Medicaid system and recovering money for taxpayers, Attorney General Martha Coakley’s office announced today that it had recovered a record $69 million in Medicaid fraud during Fiscal Year 2011. That amount eclipsed the previous record set in FY 2009 by more than $14 million.The AG’s Medicaid Fraud Division recovered the $69 million in FY 2011 based on a budget of $3.81 million, representing a ratio of $18 returned to taxpayers for every dollar in the division’s budget.

AG Coakley’s Office has recovered more than $200 million in Medicaid fraud since she took office in 2007.  The total amount recovered during FY 2011 alone ($69 million) represents more than the amount recovered during a 10 year period from 1996 – 2006.

“Our office has focused on rooting out abuse in the Medicaid system and recovering money back for taxpayers,” AG Coakley said. “At a time when every health care dollar and tax dollar is precious, this work is more important than ever. We are proud that for every one dollar in our division’s budget, we have recovered $18 for taxpayers, and we are continuing this aggressive pursuit of those who defraud the Medicaid system.”

AG Coakley’s Office continues to maintain a leadership role nationally in the fight against fraud, waste and abuse in the Medicaid program.  During the last fiscal year, representatives from the AG’s Medicaid Fraud Division participated as the lead negotiators for multi-state teams responsible for national settlements.  One such settlement returned $8 million to the Massachusetts Medicaid program from pharmaceutical manufacturer GlaxoSmithKline.  Another multi-state settlement recovered $7.5 million for the Massachusetts program from drug manufacturer Novartis.

In April 2011, AG Coakley’s Medicaid Fraud Division reached a $9 million settlement with CVS Pharmacy Inc., successfully concluding an investigation that revealed the company had been overcharging the Massachusetts Medicaid program for prescription drugs.  This settlement followed a September 2010 agreement with Omnicare, Inc., a national long-term care pharmacy, which recovered $9.45 million in pharmacy overcharges.  Another settlement obtained by the Medicaid Fraud Division involved one of the last remaining defendants in a lawsuit filed in 2003 against 13 generic drug manufacturers.  The defendant, Mylan Inc., paid $2.6 million to resolve the matter.

Medicaid is a multi-billion dollar joint state and federal program that provides health insurance for the economically disadvantaged.  The Medicaid Fraud Division works cooperatively with MassHealth and other state and federal agencies to prosecute fraud against the Massachusetts Medicaid program.

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