Omnicare agrees to $124M deal for alleged kickback

CLEVELAND (AP) — Omnicare Inc. agreed to pay $124 million
to settle two whistleblower lawsuits that alleged the company engaged
in a kickback scheme with skilled-nursing facilities across the country,
the U.S. Justice Department announced Wednesday.
The company,
based in Cincinnati, is the nation’s largest provider of drugs and
pharmacy services to skilled-nursing facilities. The U.S. Department of
Justice issued a statement that said Omnicare gave discounts to some
facilities so they would keep the company as their drug provider for
elderly Medicare and Medicaid recipients.
Omnicare said in a statement Wednesday that it committed no wrongdoing and settled the case to end
litigation.
A
settlement agreement said Omnicare paid skilled-nursing facilities with
discounted drug prices and "prompt pay discounts," a violation of the
federal anti-kickback statute.
"Schemes such as this one
undermine the health care system and take advantage of elderly nursing
home residents," Assistant Attorney General Stuart Delery said in a
statement.
Steven Dettelbach, U.S. Attorney for Northern Ohio,
said in the statement that nursing homes should be able to choose its
suppliers based on the best quality and service instead of improper
discounts. Dettelbach’s office helped complete the settlement.
The
agreement calls for Omnicare to pay the U.S. government $116 million
and various states that joint funded Medicaid programs a total of $8.2
million. One of the whistleblowers, who filed suit in New Jersey, will
be paid a percentage of what the states receive in the settlement.
The
other whistleblower lawsuit was filed in Cleveland in 2010 by a former
Omnicare employee. The settlement calls for him to be paid $17 million
from the $124 million total.