Ohio seeks $15.8M from company
The Ohio Attorney General is arguing the state is owed $15.8 million from a company that manages pharmacy benefits for Ohio Bureau of Workers’ Compensation — an accusation that the company says is “without merit.”
The allegation comes amid growing tensions between Gov. Mike DeWine’s administration and pharmacy benefit managers after a state report that showed the companies charge the state far more than they pay pharmacists. Most of the scrutiny has fallen on the companies that handle pharmacy benefits for the private Medicaid plans in Ohio, though the companies also manage prescrip- tion benefits for Ohio Bureau of Workers’ Compensation and other government and private employers.
Ohio Attorney General Dave Yost said Tuesday that he intends to go to mediation with the pharmacy benefit manager, OptumRx, seek- ing to recoup $15.8 million.
Yost claims that OptumRx failed to provide contractually agreed discounts on drugs. He said his office found their contract requires the com- pany to pass on any savings for lower prices to the BWC, and he claims the company waited a month or longer before passing on the savings.
“They broke the contract. They took our money. I want it back,” Yost said.
OptumRx said in a state- ment that “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.” The company said it has delivered more affordable prescription medications for the Ohio Bureau of Work- ers’ Compensation and Ohio taxpayers.
BWC’s c ontract with OptumRx requires the two organizations mediate any disputes before bringing litigation, Yost said. Yost said OptumRx overcharged the state agency for generic drugs purchased between Jan. 1, 2015, and Oct. 27, 2018. The BWC’s contract with OptumRx expired in Octo- ber, and BWC has contracted with a different company to manage its pharmacy bene- fits going forward.
DeWine’s administration is still reviewing whether state agencies were overcharged for drugs by pharmacy ben- efit managers. Yost stated he has hired outside counsel and experts to review phar- macy benefit manager data and could potentially pur- sue litigation.
Yost said in a separate statement from his office that he “will not hesitate to pursue overcharges and fraudulent conduct. This is an important first step in this process.”
Pharmacy benefit man- agers are commonly used by insurance companies to negotiate deals on drugs and process pharmacy claims. They charge Ohio Medicaid plans for the cost of drugs and they pay pharmacists for the prescriptions. The companies also have addi- tional ways of making money, including fees and rebates.
Critics have said there wasn’t enough transparency about how much taxpayer money flows through these middlemen makes its way to pharmacists. For some drugs, pharmacists say they only get paid a small portion of the price billed to Medicaid plans and the rest is kept by the pharmacy benefit managers.