CVS settles for $36.5M over false Medicaid insulin claims, Minnesota recovers $400K
ST. PAUL, Minn. (FOX 9) - Minnesota Attorney General Keith Ellison announced a settlement with CVS, holding the pharmacy chain accountable for years of alleged over billing related to insulin pens.
CVS settles allegations of overbilling Medicaid for insulin
What we know:
Ellison and a coalition of 37 attorneys general, along with the federal government, reached a $36.5 million national settlement with CVS Pharmacy, Inc. Minnesota will receive more than $850,000, including over $400,000 in direct restitution to the state’s Medicaid program.
The allegations state that from 2010 through 2020, CVS intentionally over billed government healthcare programs — including Medicare, Medicaid, TRICARE and the Federal Employees Health Benefits Program — by submitting false claims for insulin pens. The company accepted responsibility for requesting and receiving reimbursement for ineligible refills, dispensing more insulin pens than needed, and under-reporting the days of supply.
"Insulin isn’t a luxury, it’s a medication people need to live, and Minnesota taxpayers generously help pay for insulin for Minnesotans who can’t afford to pay for it on their own. This is a vital social compact that CVS deliberately broke — along with breaking federal law — when it knowingly over billed taxpayers for insulin it dispensed. This resolution should be a warning to any corporation that defrauds Medicaid that we will hold them accountable," said Ellison.
Some CVS pharmacies distributed insulin in amounts above limits set by government programs or pharmacy benefit managers. When claims were rejected, instead of following the process to request an override, some CVS pharmacies resubmitted claims listing only the maximum allowed by insurance, which was less than what was actually dispensed.
Local perspective:
The Medicaid Fraud Control Unit in Ellison’s office, which is part of the National Association of Medicaid Fraud Control Units, played a key role in the investigation. The unit works to uncover and prosecute fraud and abuse in Medicaid.
Minnesota’s Medicaid Fraud Control Unit receives 75% of its funding from the U.S. Department of Health and Human Services under a grant award totaling $5,078,704 for federal fiscal year 2026. The remaining 25%, totaling $1,692,898 for fiscal year 2026, is funded by the State of Minnesota.
The investigation was led by the National Association of Medicaid Fraud Control Units and the United States Attorney’s Office for the Southern District of New York, with Minnesota’s unit actively involved.
What we don't know:
The settlement resolves the allegations, but it is not clear if any additional penalties or changes in CVS’s practices will follow beyond what is described in the agreement. Details about how future oversight will be handled have not been specified.
The Source: Information from the Minnesota Attorney General's Office.