US State settlements with Pharma over Medicaid fraud hit record highs, says a Public Citizen report

Individual states in the USA are settling more cases than ever with pharmaceutical companies accused of defrauding their Medicaid programs and are recovering taxpayer money at record amounts from those settlements, according to the findings of a new report from consumer advocacy Public Citizen. In an era of ever-tighter Medicaid budgets, many states have recovered just as much, if not more, money from this litigation as they spent on all Medicaid fraud enforcement.

The report suggests that drugmakers have paid $6.6 billion in fines and penalties this year to settle claims of defrauding US health programs, up from $2.5 billion in 2011. Moreover, the report finds that federal government has reached settlements in 49 cases totaling $14.5 billion since the start of 2009, while states resolved 94 cases for $3.7 billion in the same period. In the previous 18 years, the federal government settled 55 cases and states settled 41. Common frauds include overcharging government programs such as Medicare and marketing therapies for unapproved uses.

Main findings