Over the years, there has been a consolidation of most of the U.S. pharmacy benefits business under OptumRx, CVS and Express Scripts. This has not occurred without controversy in workers’ compensation claims.
The pharmacy benefit manager administering prescription drugs for workers injured on the job overcharged the Ohio Bureau of Workers’ Compensation on more than 1.3 million claims for generic medications, according to a new court filing by Attorney General Dave Yost’s office.
The report in the Columbus Dispatch says that attorneys for the state asked the court to rule OptumRx breached its contract and is liable for unspecified damages. According to the court filing, OptumRx overcharged the state on 57% of 2.3 million claims between January 2014 and September 2018.
“By failing to follow the pricing rules it agreed to and promised to obey, OptumRx violated its duties to the State of Ohio and BWC and wrongfully pocketed millions of dollars in unearned profits,” the court filing says.
The state sued Texas-based OptumRx last March, leading to several months of mediation that failed to resolve the dispute. Late Friday, attorneys for the state filed a motion for partial summary judgment, arguing “there can be no dispute” that OptumRx violated terms of its contract.” Attorneys asked the court to determine damages at a later hearing.
In an earlier filing, the state asked for a fine of up to $5,000 for each day that the improper prices were charged, pushing the potential damages into the millions.
OptumRx spokesman Drew Krejci said in response to the latest allegations, “We are honored to have delivered access to more affordable prescription medications for the Ohio Bureau of Workers’ Compensation and Ohio taxpayers. We believe these allegations are without merit and will vigorously defend ourselves.”
OptumRx, owned by UnitedHealth Group, was hired by the Bureau of Workers’ Compensation to manage claims, set pharmacy reimbursements and handle other billing matters. The bureau is funded by assessments on employers and spends about $86 million a year on prescription drugs.
The pharmacy benefit manager’s contract with the bureau expired in 2018 and was not renewed.
According to the latest filing by the state, OptumRx agreed to charge the bureau the lesser of four possible prices for generic drugs with the “federal upper limit,” a maximum price set by the Centers for Medicare and Medicaid Services for federally funded programs, the most that could be paid.
“The federal upper limit acted as a price ceiling,” the filing said. “If the other three prices, (which were set by OptumRx, drug companies and pharmacies, respectively), were higher than the federal upper limit, then the federal upper limit applied.”
The filing included an analysis of OptumRx claims data showing the company charged the bureau more than the federal upper limit price on 1.3 million of 2.3 million generic claims. In one example cited, OptumRx charged the bureau $101 for Lamotrigine, used to treat seizures, when the federal upper limit was $55.51, making for a $45.59 overcharge.
In its work for Ohio Medicaid, OptumRx was found to have billed the state $26 million more than it paid pharmacists to fill prescriptions in a one-year period.