Ohio AG sues pharmacy middleman, alleges overcharges

Ohio Attorney General Dave Yost is accusing a company that manages pharmacy benefits of overcharging the Ohio Bureau of Workers’ Compensation $15.8 million.

Yost’s office said in a statement today that the state filed a lawsuit in Franklin County Common Pleas Court against the company, OptumRx.

“We believe these allegations are without merit and are working with the State to resolve the Bureau’s concerns in accordance with the terms of our contract,” OptumRx said.

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Pharmacy benefit managers are private companies that work with insurers and manage prescription benefits. The companies have said they help consumers by negotiating deals on expensive prescriptions. The companies also have additional ways of making money, including fees and rebates.

Two of the large pharmacy benefit managers that have managed benefits for the state, CVS Health and OptumRx, have been criticized by some policy makers and pharmacists who say the companies keep too much of the money they manage and aren’t transparent about how they do business.

A report in June showed the companies managed about $2.5 billion in Ohio Medicaid pharmacy benefits in 2017 and kept $223.7 million the money they billed Ohio Medicaid plans.

Yost alleges that the overcharges occurred because OptumRx “failed to provide contractually agreed discounts on drugs.” Yost’s office on Feb. 11 requested OptumRx go to mediation over the dispute over billing charges.

“It’s been 30 days and we only just now have a meeting scheduled to talk,” Yost said in a statement. “Times up, give us our money.”

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He also said that his office is still reviewing pharmacy benefit manager practices, continuing an investigation started under then-Attorney General Gov. Mike DeWine.

Major changes have already happened. Instead of marking up the cost of prescriptions, starting Jan. 1, pharmacy benefit managers that work with private Ohio Medicaid plans charge a disclosed administration fee and then bill the plans the same cost they paid pharmacists for the drugs.

The Bureau of Workers’ Comp contract with OptumRx expired in October and it now contracts with a different pharmacy benefit manager, according to Yost’s office.

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