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Walgreens To Cough Up Nearly $270 Million In Health Care Fraud Settlements

Walgreens has long been known as one of the country’s largest pharmacy store chains, providing everything from photo services to health and wellness products. Of course, Walgreens is also widely known as a go-to destination for filling out prescriptions. However, the company’s reputation going forward is likely to be a lot different.

Earlier this week, Walgreens was ordered to pay the United States and state governments a total of $269.2 million to resolve allegations of health care fraud. As reported by, courtesy of a recently released report from the United States Department of Justice, Manhattan U.S. Attorney Geoffrey S. Berman led the charge against the large pharmacy store chain in two health care fraud lawsuits. The end result was two settlements of $209.2 million and $60 million respectively.

Walgreens knowingly submitted improper claims.

The first settlement was approved on January 16th by U.S. District Judge Paul A. Crotty. According to the report, “it requires Walgreens to pay $209.2 million to resolve allegations that it improperly billed Medicare, Medicaid, and other federal healthcare programs for hundreds of thousands of insulin pens it knowingly dispensed to program beneficiaries who did not need them.”

The second settlement was approved on January 15th by U.S. District Judge J. Paul Oetken. It “requires Walgreens to pay $60 million to resolve allegations that it overbilled Medicaid by failing to disclose to and charge Medicaid the lower drug prices that Walgreens offered the public through a discount program,” the DoJ report reveals.

The Insulin Pens Settlement.

In the Insulin Pens Settlement, it was found that Walgreens regularly submitted false claims regarding federal reimbursement for insulin pens. The company configured its electronic pharmacy management system so that it prevented pharmacists from dispensing less than a full box of five insulin pens, even if patients weren’t in need of that much medication.

As well, the DoJ report reveals that “when a full box of insulin pens exceeded the federal healthcare program’s limit on the total days of supply (i.e., the total number of daily doses) that could be dispensed and reimbursed at that time, Walgreens evaded this restriction by falsely stating in its reimbursement claims that the total days of supply did not go over the limit.”

The Discount Drug Pricing Settlement.

Walgreens operated the Prescription Savings Club (or PSC) program. It gave customers discounts on their prescription drugs. However, Walgreens did not disclose to Medicaid their discounted prices and instead sought reimbursement for amounts greater than what was actually charged customers.

According to the report, “in submitting claims for reimbursement to Medicaid, Walgreens did not identify its PSC program prices as its U&C (usual and customary) prices for the drugs on the PSC program formulary, which resulted in the States paying more in reimbursement than they would have paid if WALGREENS had identified its PSC program prices.”

Berman offered a statement about the settlements.

“Medicare and Medicaid provide essential healthcare coverage to millions of people across this country,” he is quoted as saying, “The financial integrity of these programs depends on truthful and accurate billing by pharmacies like Walgreens. Overbilling and improper billing of Medicare and Medicaid unduly burden taxpayers and put the solvency of these vital healthcare programs at risk.”

If you are an attorney currently trying a health care fraud case, please don’t hesitate to contact Allegiant Experts to find out how our clinical expertise may help you. Call us at 407-217-5831 or email us at

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