Walgreens Reaches $106.8 Million False Claims Act Settlement with the United States

Walgreens Boots Alliance Inc. and Walgreen Co. (collectively, “Walgreens”) agreed to pay $106.8 million in two settlements (here and here) to resolve allegations that Walgreens violated the False Claims Act and various state statutes when billing government health care programs for prescriptions that were never dispensed to patients.

According to the government, between 2009 and 2020, Walgreens submitted false claims to Medicare, Medicaid, and other federal health care programs for prescriptions that it processed but were never picked up by the patients. This means that Walgreens received tens of millions of dollars for prescriptions from federal health care programs that were never actually provided to health care beneficiaries.

Under one of the settlements, Walgreens did receive credit for disclosure, cooperation, and remediation. For example, Walgreens implemented enhancements to its electronic pharmacy management system to prevent this from happening again in the future and also self-reported some of the conduct resolved. Additionally, because Walgreens previously refunded $66,314,790 related to the settled claims, it will receive a credit for that amount.

This settlement resolves three cases pending in District Courts throughout the country – the District of New Mexico, the Eastern District of Texas, and the Middle District of Florida. The claims were initially brought by two former Walgreens employees – a district pharmacy supervisor and a pharmacy manager. The federal share of the settlement is $91,881,530, and $14,933,259 will be returned to individual states through separate settlement agreements with Medicaid participating states.

As we often see, the settlements are not an admission of liability by Walgreens nor a concession by the United States that its claims are not well founded.

“Federal health care programs provide critical health care services to millions of Americans,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will hold accountable those who abuse these programs by knowingly billing for goods or services they did not provide.”

“Medicare enrollees, and consumers at-large, rely on pharmacies for critical medications that sustain their quality of life, and providers who prey upon public health care programs to increase profit margins must be held accountable,” said Deputy Inspector General for Investigations Christian J. Schrank of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “HHS-OIG is unwavering in its commitment to protecting taxpayer-funded healthcare programs and ensuring those that threaten their integrity are held liable for their actions.”

“Due to a software error, we inadvertently billed some government health care programs for a relatively small number of prescriptions our patients submitted but never picked up,” Walgreens said in a statement picked up by Reuters. “We corrected the error, reported the issue to the government and voluntarily refunded all overpayments.”