Qui Tam

CVS Caremark Corp. settles Medicaid fraud allegations for $36.7 Million

By Brian F. LaBovick

In a remarkable turn of events, America's self proclaimed largest pharmacy, CVS Caremark, has agreed to settle Medicaid fraud allegations for $36.7 million. According to information obtained from a whistleblower and extensive research, the company allegedly switched the tablet version of the drug  Ranitidine (generic Zantac) to a more expensive capsule version. According to the Justice Department, CVS Caremark allegedly made the drug switch from 2000 to 2006 to increase reimbursements from Medicaid.

The whistleblower, Bernard Listiza, a licensed pharmacist, will be rewarded $4,309,330 for his efforts in bringing this medicaid fraud to light.  As previously mentioned previously on the Whistleblower Law Blog, a whistleblower can receive a reward of 15 percent to 25 percent of what the government recovers,  if the government joins the qui tam case and if the government declines to join the qui tam lawsuit, the whistleblower can receive a reward of 25 percent to 30 percent of what the government recovers.

We can only hope that these large awards will begin to serve as deterrents for companies such as CVS Caremark to engage in Medicaid fraud. Thanks to the diligence of U.S. Attorneys such as U.S. Attorney Patrick Fitzgerald, the government is pursuing corporations and individuals charged with fraud against the government. In a recent statement, U.S. Attorney, Patrick Fitzgerald, said, “These penalties, coupled with the willingness of insiders to report fraud, should deter such misconduct, but when it doesn’t, the result in this case and others serves notice that we will aggressively pursue all available legal remedies.” 

The Whistleblower Law Blog salutes the brave whistleblowers who come forward and the diligent men and women prosecuting fraud on behalf of the government.  Sometimes, it may take years and many obstacles to overcome, but it is all worthwhile when a whistle blower's testimony can help the government recoup dollars and treble damages from Corporations and individuals that are found defrauding the government.

Click here to read more from the Department of Justice.

Full post as published by Whistleblower Law Blog on March 19, 2008 (boomark / email).