Massachusetts Attorney General Andrea Joy Campbell has filed a complaint-in-intervention in a lawsuit against CVS Health Corporation and CVS Pharmacy, Inc. (CVS) for charging MassHealth, the state’s Medicaid program, higher prices than they offered to the general public for the same drugs.
In her complaint, AG Campbell alleges that CVS offered lower drug prices to cash-paying customers through a discount program administered by a company called ScriptSave but evaded its responsibility to report and bill MassHealth the lower, discounted rates. The complaint alleges that this conduct violated Massachusetts pricing regulations, which require pharmacies to charge MassHealth the lowest price they charge any other customer.
“When pharmacies offer discounted drug pricing to its customers, they must also charge MassHealth that same low price,” said AG Campbell. “At a time when costs are sky-high, our taxpayers should not have to foot the bill for pharmacies’ inaccurate price reporting.”
According to the AG’s complaint, despite the fact that MassHealth has had a “Most Favored Nation” drug pricing regulation since 1995, which entitles MassHealth to the lowest prices CVS charges or accepts from other payors, CVS has followed a methodology for submitting drug pricing to MassHealth that has not given MassHealth its best prices, particularly for generic drugs. The complaint alleges that CVS has contracted with ScriptSave to administer discount card programs for former customers of CVS’s discount card program, Health Savings Pass, and at former Target pharmacies, which CVS acquired. Customers with those ScriptSave discount cards often received lower prices than MassHealth.
AG Campbell filed this complaint jointly with the attorneys general of Connecticut, Indiana, and Oklahoma. AG Campbell’s lawsuit follows a whistleblower complaint filed in the United States District Court for the District of Columbia.
This matter is being handled by Deputy Chief Kevin Lownds, Managing Attorney Ian Marinoff, Investigations Supervisor Christopher Cecchini, and Senior Healthcare Fraud Investigator William Welsh, all of the AG’s Medicaid Fraud Division. MassHealth provided substantial assistance with the investigation.
The AGO’s Medicaid Fraud Division is a Medicaid Fraud Control Unit, annually certified by the U.S. Department of Health and Human Services to investigate and prosecute health care providers who defraud the state’s Medicaid program, MassHealth. The Medicaid Fraud Division also has jurisdiction to investigate and prosecute complaints of abuse, neglect and financial exploitation of residents in long-term care facilities and of Medicaid patients in any health care setting. Individuals may file a MassHealth fraud complaint or report cases of abuse or neglect of Medicaid patients or long-term care residents by visiting the AGO’s website.
The Massachusetts Medicaid Fraud Division receives 75 percent of its funding from the U.S. Department of Health and Human Services under a grant award totaling $5,922,320 for federal fiscal year 2025. The remaining 25 percent, totaling $1,974,102 for FY 2025, is funded by the Commonwealth of Massachusetts.
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