A.G. Schneiderman Announces $2.5 Million Settlement With NYC Pharmacy For Improper Medicaid Billings

AG Investigation Resolves Allegations Related To Walgreen-Owned Trinity HomeCare LLC; Pharmacy Lacked Proof It Delivered Expensive Infusion Drugs, Primarily For Hemophilia Patients, To Their Homes

Schneiderman: Overbilling By Pharmacies And Improper Drug Delivery Practices To Increase Medicaid Billings Will Not Be Tolerated

NEW YORK – Attorney General Eric T. Schneiderman today announced a settlement that returns $2.5 million to the state’s Medicaid program. The agreement reached with Trinity Homecare LLC, a pharmacy primarily owned by Walgreen Co., began with a whistleblower claim of improper conduct and false Medicaid billings related to drugs mainly prescribed for hemophilia patients. The court approved settlement resolves claims of undocumented delivery by the pharmacy of infusion drugs. In at least one instance, these expensive drugs were allegedly left outside a patient’s home without signature by the patient. The drugs can cost tens of thousands of dollars per delivery. Located in College Point, Queens, Trinity also allegedly submitted claims to Medicaid for a greater amount of drugs than it could document were actually delivered.

“The rules are plain: Pharmacies that deliver drugs to Medicaid patients must document that the patient received that medication – and in the right amount,”  Attorney General Schneiderman said. “The hemophilia drugs dispensed and sent to patients in this case, per delivery, can cost as much as a new car. Overbilling that drains dollars from our important Medicaid program harms the most vulnerable New Yorkers. We cannot allow it.”

The Attorney General’s investigation and audit of Trinity’s Medicaid billings found improper conduct and false billings from 2007 to September 2011, totaling $2.5 million for eight patients in New York City and one on Long Island.  

Trinity HomeCare LLC is a  pharmacy that dispenses and delivers expensive prescription drugs to patient homes. During the relevant period, Trinity was acquired by Option Care, Inc. and OptionCare of New York. In August 2007, Walgreen Co. acquired Option Care, Inc., later known as Walgreens Infusion Services, Inc. The investigation found that Option Care and Walgreen, which are both parties to the settlement, failed to ensure that Trinity complied with federal and state laws and Medicaid rules and regulations.

The whistleblower in this case, a former employee of the pharmacy, filed a lawsuit in 2009 alleging that Trinity pushed infusion drugs, which are prescribed to manage symptoms, to hemophilia patients and presented claims to Medicaid for unneeded or excessive quantity of these drugs. The whistleblower alleged improper billing for drug deliveries, including ones that patients refused to accept and excess shipments. The Attorney General found that, at times, patients did not receive infusion drugs and, in at least one case, a delivery was simply left in an apartment complex hallway. In other cases, the pharmacy lacked documentation that it had delivered the drugs.

The drugs are Advate, Alphanate, Benefix, Carimune-NF, Cerezyme, Feiba-VH, Flebogamma, Flebogamma-DIF, Gammagard, Gammagard-S/D, Gamunex 10%, Gamunex-C, Helixate-FS, Humate-P, Koate-DVI, Kogenate-FS, Mononine, Nabi-HB, Novoseven, Novoseven RT, Octagam 5%, Panglobulin, Polygam S/D, Privigen 10%, Recombinate, Refacto and Xyntha.

The Attorney General’s investigation and settlement relates to the whistleblower lawsuit filed in U.S. District Court alleging violations of the federal and state False Claims Acts. The total amount of the settlement is $2,551,062.32. After reimbursement of the federal contribution to Medicaid, New York’s Medicaid program will receive $1,484,766.84 for the infusion drug case.  Under the False Claim Acts, whistleblowers also receive a share of the settlement. Special Assistant Attorney General Sherrie Brown of the Attorney General’s Medicaid Fraud Control Unit led the investigation, assisted by Special Assistant Attorney General Elizabeth Silverman; Medical Analyst Catherine Mosher, RN; Principal Special Auditor Investigator Jean Moss, Associate Special Auditor Investigator Gina Poletto; Senior Investigator Wayne Rivers, Supervising Investigator Edward Keegan; Electronic Investigative Support Group Deputy Director Carolyn Hart; Information Technology Specialist 3 Gail Lysiak; and Legal Assistants Mohamad Zakaria, Geoffrey Gund and Amy Vastola. The Medicaid Fraud Control Unit is led by Acting Director Amy Held. The Division of Criminal Justice is led by Executive Deputy Attorney General Kelly Donovan.

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