CVS will pay $3.7 million to state Medicaid program

CVS Caremark Corp. has agreed to pay $3.7 million to the Massachusetts Medicaid Program to settle allegations of billing improprieties, the office of Massachusetts Attorney General Martha Coakley (right) said today.

Headquartered in Woonsocket, R.I., CVS Caremark operates a pharmacy chain and also provides pharmacy services.

In a statement, CVS said, "Pursuant to the settlement agreement, the company has expressly denied engaging in any wrongful conduct."

The share of Medicaid payments that will go to Massachusetts is part of a larger $36.7 million settlement between CVS Caremark and the federal government, a coalition of 23 other states, and the District of Columbia, Coakley's office said.

The agreement settles allegations that from 1999 through 2006, CVS filled prescriptions for many Medicaid recipients by aggressively switching dosage forms of an anti-ulcer medication and that those switches caused Medicaid programs nationwide to pay substantially more for this medication than they otherwise would have, Coakley's office said.

A CVS spokesman noted that it dispensed the medication in capsule form rather than in tablet form because it cost less for CVS to acquire the drug in capsule form.
(By Chris Reidy, Globe staff)