Walgreens has agreed to pay $360 million to settle an arbitration dispute with Humana that has spanned practically 5 years. The payout is roughly half of what Walgreens was initially ordered to pay when the difficulty was first resolved final 12 months.
Humana started the arbitration course of in 2019 when it claimed that for greater than a decade Walgreens had been charging the corporate and its beneficiaries “unlawfully inflated” costs for prescriptions.
The dispute revolved round Walgreens’ Prescription Financial savings Membership, a program geared toward aiding uninsured or underinsured sufferers in accessing extra reasonably priced medicines. When submitting reimbursement claims to Humana, the pharmacy chain recorded the usual retail costs for the medicine disbursed beneath this program as its “ordinary and customary” charges somewhat than the particular costs, Humana alleged.
In March of final 12 months, an arbiter ordered Walgreens to pay Humana a $642 million award. However Walgreens went on to problem that award in federal court docket.
In lawsuit filed in Might, Walgreens acknowledged that the arbitration “started in betrayal and led to a miscarriage of justice.” The pharmacy large argued that it shouldn’t must pay greater than half a billion {dollars} “when no strange reader of the contract at difficulty would discover that Walgreens had performed something unsuitable, and when the proof confirmed Humana was absolutely conscious of Walgreens’ method and did nothing till solicited by conflicted counsel.”
In a separate Might submitting, Humana requested the choose to uphold the $642 million award.
U.S. District Decide Ana Reyes dismissed Walgreens’ federal lawsuit on Friday — the day after a Walgreens submitting with the Securities and Trade Fee revealed that the 2 corporations had privately agreed to a brand new award quantity of $360 million on December 29.
Neither Humana nor Walgreens responded to MedCity Information’ requests for remark.
Walgreens remains to be coping with different court docket points associated to claims that it has been overcharging payers for prescribed drugs. As an example, the pharmacy chain is nonetheless defending itself towards Blue Cross plaintiffs that allege Walgreens has been knowingly submitting claims with falsely inflated drug costs.
Picture: SARINYAPINNGAM, Getty Pictures
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