Centene Reaches Agreement with Ohio and Mississippi on Pharmacy Benefit Practice

Centene, based in St. Louis, denied any responsibility in its dealings with state Medicaid programs.


Jeff Roberson / Associated Press

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It said it resolved Ohio and Mississippi claims related to its pharmacy benefit billing practices, and that it is setting aside $ 1.1 billion to resolve similar issues with other states.

The large managed care company said it would pay about $ 88 million to Ohio and $ 55 million to Mississippi. Ohio Attorney General Dave Yost sued the company in March, claiming it had misled the state Medicaid program about its pharmacy-related costs, resulting in overpayments by the state.

“Centene took advantage of all of us who pay taxes to care for the most vulnerable Ohioans,” he said in a statement Monday.

The Mississippi attorney general and auditor investigated similar issues, although the state had not sued Centene. They said in a press release that the settlement “resolves allegations of overpayments as part of the Mississippi Medicaid program.”

Centene, which is based in St. Louis, said it did not admit fault to the settlements and denies any responsibility for the practices the states examined. The company said the issues the states focused on occurred “primarily during 2017 and 2018” and has since restructured its pharmacy benefit operations.

Several states are investigating the disclosure and billing practices of pharmaceutical benefits administrators, generally focused on their Medicaid and state employee plans. Pharmacy benefit managers often work for employers and health plans, managing drug benefits and negotiating prices with drug companies and pharmacies. They often have many lines of business that involve state governments, including managing state employee drug benefits and working with managed care companies that administer Medicaid benefits.

The stakes for Centene are particularly high in Medicaid-related investigations because managing Medicaid coverage is a core business of the company. Ohio had deferred a decision on whether Centene could participate in its new Medicaid contracts for 2022, due to the litigation. The settlement is “reopening the door to [Centene] to receive a contract award ”in Ohio, wrote Scott Fidel, an analyst at Stephens Inc.

Centene said it was negotiating with two law firms, Liston & Deas and Cohen Milstein, who are working with other states “in an effort to achieve a final resolution to these concerns.” The company said its new $ 1.1 billion reserve is related to those talks.

Write to Anna Wilde Mathews at [email protected]

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It appeared in the print edition of June 15, 2021 as ‘Centene Reaches Agreement with States on Pharmacy Benefit Practice Managed Care Company Establishes on Pharmacy Benefit Practice.’

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