McGraw still fighting lawmakers over painkiller money

John O'Brien Feb. 14, 2008, 10:38am




CHARLESTON, W. Va. - West Virginia Attorney General Darrell McGraw continued to bicker with members of the Legislature Tuesday as he defended his controversial $10 million OxyContin settlement.

According to a report in the Charleston Daily Mail, it did not take long for members of the House Finance Committee to start voicing concerns.

"You talk about being criticized for winning all these lawsuits," said John Doyle, D-Jefferson, according to the report. "I've never criticized that. In fact, I commend your effort.

"I and others, however, level a different criticism, one of which you have not yet addressed. That is your attempts, once you've won the money, to appropriate it.

"That is constitutionally the job of the Legislature to appropriate money. The minute your office or any office gets money for the State of West Virginia, that money is instantly the property of the taxpayers of West Virginia. Therefore, the Legislature must decide how it is spent."

McGraw eventually told Doyle, "No good deed goes unpunished," the report adds.

Two times in recent months, the federal Centers for Medicare and Medicaid Services has notified the state's Department of Health and Human Resources that it will be withholding Medicaid funds because it does not believe it was given what it was owed from two lawsuit settlements.

A $4.1 million withhold, currently being appealed, results from the 2004 $10 million agreement with Purdue Pharma, manufacturer of the prescription painkiller OxyContin. Another $634,525 potential withhold relates to a settlement with Dey Inc., which McGraw's office claimed inflated the prices of the prescription drugs it manufactured, thereby defrauding the state's Medicaid program.

The State kept all of the settlement funds, though the federal government provides nearly 75 cents of every dollar the State spends on Medicaid.

Last month, he had a similarly testy encounter before the Senate Finance Committee.

During that meeting, McGraw, who is seeking his fifth term in office this year, accused the federal government of "double-dipping," criticized the U.S. Chamber of Commerce, forced an awkward break to get a drink of water and told a story about his cousin's return from the Korean War.

"We had several named plaintiffs in the lawsuit," McGraw said, mentioning the DHHR, the Public Employees' Insurance Agency and Workers' Compensation. No state agencies were named as plaintiffs in the original OxyContin lawsuit, but later were added.

Still, none of the agencies received any of the money.

"Our focus changed," Chief Deputy Attorney General Fran Hughes said of the case. "When it was first filed, we had a different approach."

Eventually, the settlement allowed McGraw to spend the funds on substance abuse programs. In addition to those programs, he's spent $500,000 on a pharmacy school at the University of Charleston.

Sen. Jesse Guills, R-Greenbrier, asked McGraw who would be responsible for paying the federal government back.

"If we lose this contest, who will pay the $4.1 million?" Guills asked.

"The burden is back on the Legislature," McGraw replied.

Guills also asked where that money would come from.

"Perhaps sharper pencils than mine can find 0.005 percent of that money," McGraw said, referring to $2 billion figure he's secured in settlements since becoming AG.

McGraw said his office had three options when reaching the OxyContin settlement.

"We could take the money agreeable to the judge and the drug company," he said. "We could've turned it over to the DHHR, and the money would have gone back to the federal government. Bye-bye.

"Or we could've given it to the Legislature, which would have been obliged to give it to the DHHR. Bye-bye."

Guills later asked if the state agencies involved in the case were consulted about the settlement.

"We're lawyers, and we do litigation and settlements," McGraw replied.

McGraw later attacked the U.S. Chamber of Commerce, which owns The West Virginia Record.

"The national Chamber of Commerce made this complaint," he said of the actions that led to the federal government seeking reimbursement for Medicaid money. "They spend a lot of time running West Virginia down. A judicial hellhole? That's the national Chamber."

During Tuesday's meeting with the House Budget Committee, McGraw replied, "Everything's political," to a question, according to the report. He added that he "seem(ed) to smell something" in the line of questioning from Kevin Craig, D-Cabell. Craig asked why the agencies that were named plaintiffs in the suit did not receive any of the funds.

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