–Report by Annette Abraham
The United Health Group Inc. Subsidiary, OptumRX is set to pay $15 Million towards a settlement concerning a suit filed against them in the United State District Court for the Northern District of Ohio. The suit, filed in March 2022, claimed that OptumRX overcharged the Ohio Bureau of Workers Compensation on standard drugs.
OptumRX is a Pharmacy Benefit Manager. PBMs are companies that manage the costs of the prescription drugs that go into the market. Ideally, these companies are expected to serve as middlemen to negotiate for lower prices and discounts on behalf of an individual’s health plan or insurance.
OptumRX was contracted by the Ohio Bureau of Workers Compensation, an agency that provides compensation as well as medical benefits for work-related injuries, diseases or death. The Bureau is funded by regular sums taken out of employees’ paychecks. The contract detailed that OptumRX would manage prescription drug costs for the state agency’s employees under a health insurance scheme. Through the contract, OptumRX was required to charge the Bureau the lowest of four potential prices for generic drugs.
Through a series of emails uncovered by Ohio Attorney General Dave Yost and his team, it was discovered that OptumRX did not follow the terms of the contract, which led to an overcharge on over 57% of the 2.3 million prescription claims that the bureau received from injured workers in the state between January 2014 and September 2018.
The dispute was settled extra-judicially, with Ohio Attorney General Dave Yost and the team representing OptumRX coming to an agreement on the terms of the settlement and the compensation owed to the State of Ohio. The office of the Attorney General of Ohio released a statement through their official website on Tuesday (EDT), stating: “OptumRx will repay the state $15 million in prescription-drug overcharges assessed to the Ohio BWC”.
This is not the first time the Ohio court has levied charges against the company with respect to contract breaches and lack of transparency. A suit filed against them in November of 2019 contained similar charges against the PBM, accusing them of misappropriating $16 Million dollars through malpractices. Following this suit, The bureau discontinued its contract with OptumRX.
Attorney General Dave Yost has a history of uncovering the malpractices and misconducts that Pharmacy Benefit Managers often commit through their contracts both with private as well as government-funded organizations and parties. In fact, this lawsuit is a crowning one in AG Dave Yost’s rally against PBMs, his total recoveries from these companies following the OptumRX settlement amounts to more than $100 million.
PBMs misappropriating funds and misquoting cheques is not a new phenomenon. In 2018, an investigation commissioned by the Ohio Department of Medicaid found that in 2017, USA’s biggest PBMs CVS and OptumRX had together charged taxpayers $244 million more than what they paid the pharmacies that provide Medicaid drugs to the people under various government organizations, pocketing the difference. This investigation was in part, instigated by the auditor of state Dave Yost.
Previously, Attorney General Dale Yost had recovered $88 million from Centene, a Pharmacy Benefits Manager based out of St. Louis, Missouri. In this lawsuit, various subsidiaries of Centene had been accused of misrepresenting reimbursement requests that had already been paid by third parties. The arrangement of the subsidiaries of Centene also led to artificially inflated dispensing fees.
Currently, a similar suit is being pursued by Attorney General Dave Yost against a PBM owned by Cigna, Express Scripts, in relation to their contract with Ohio Highway Patrol Retirement System. 22 states have currently issued claims against Centene, with Kansas, Mississippi, Illinois and Arkansas following Ohio in reaching settlements with the PBM.
OptumRX is one of the many PBMs that are currently using loopholes and malpractices to misappropriate money from state-managed organizations funded by the US taxpayers. The Ohio Attorney General’s lawsuit against the company is one of many that aim to reduce the impact of such practices on the common man and to return funds to the state. Currently, OptumRX will pay a total sum of $15 million to the state of Ohio to settle the money misappropriated through false charges filed by the company for prescription drugs.