TL/DR –
Ahold Delhaize USA has agreed to pay $40 million to resolve allegations that it violated the False Claims Act by reporting inflated prices on claims to federal healthcare programs. The U.S. government alleged that the company’s supermarkets with in-store retail pharmacies, including Giant, Hannaford, Stop & Shop, Food Lion, and others, failed to accurately report their discounted prices as their “usual and customary” prices on claims to Medicare Part D, Medicaid, and TRICARE. This resulted in the programs paying inflated amounts on such claims.
Ahold Delhaize USA Inc. Resolves Claims of Inflated Prices
Supermarket company, Ahold Delhaize USA Inc., based in Quincy, Massachusetts, has settled to pay the US and associated states $40 million. This resolves claims that it breached the False Claims Act and state equivalents by presenting overstated “usual and customary” costs on healthcare program claims.
The Assistant Attorney General, Brett A. Shumate, observed that these healthcare programs depend on pharmacies providing accurate pricing information, critical in shaping the payment formulas. Shumate warned that any inflation in prices could lead to excess payments on claims.
U.S. Attorney Troy Rivetti stated that the settlement demonstrates the commitment of the United States in bringing dishonest pharmacies to justice. He emphasized the role of pharmacies in charging contractually agreed prescription prices to Medicare and Medicaid.
Implications of False Pricing
Scott J. Lampert of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) added that the act of inflating prices jeopardizes taxpayer-funded programs. He pledged to continue rigorous investigations to protect these essential programs.
The allegations suggest Ahold Delhaize’s retail stores, such as Giant, Hannaford, Stop & Shop, Food Lion, etc., failed to report discounted prices as “usual and customary” on Medicare Part D, Medicaid, and TRICARE claims. This failure caused these programs to pay inflated amounts.
Out of the $40 million paid by Ahold Delhaize, the federal government will receive $32.9 million, with the rest going to states partaking in the settlement.
The Role of Qui Tam and Whistleblower Laws
This resolution also handles claims under the qui tam or whistleblower provisions of the False Claims Act, brought by Lawrence LaBenne, a pharmacist at an Ahold Delhaize supermarket in Pennsylvania. LaBenne will get $6,083,587 from the federal share of the settlement.
The settlement was the result of a joint effort between the Justice Department, the U.S. Attorney’s Office for the Western District of Pennsylvania, and several health and state agencies. The resolution underscores the government’s focus on combating healthcare fraud through powerful tools like the False Claims Act.
Reporting Fraud
Potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
The settlement only resolves the allegations, and it has not been concluded that there was any liability.
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