Pharmacy Benefit Manager pays OIG-HHS over $2 million for false Part D claims

by Ben Vernia | August 11th, 2014

On July 31, the Office of Inspector General of HHS announced that Missouri-based Argus Health Systems, Inc., had agreed to pay just over $2 million to settle civil allegations that the company submitted false Prescription Drug Event (PDE) claims for Medicare Part D drugs which included unlawful charges for Louisiana state sales tax. According to the OIG’s website:

Argus Health Systems, Inc. – a health care information management services provider and pharmacy benefits manager headquartered in Kansas City, MO – entered into a settlement agreement with the Office of Inspector General (OIG) for the U.S. Department of Health and Human Services, effective July 31, 2014. Under the agreement, Argus agreed to pay OIG $2,029,210 to resolve allegations that the company submitted prescription drug event (PDE) data to Medicare that included sales tax from Louisiana pharmacies even though Medicare Part D drugs were not taxable under Louisiana law as of July 1, 2006. Specifically, OIG contends that from July 1, 2006 through December 31, 2009, Argus knowingly submitted or caused to be submitted PDE claims to the Centers for Medicare & Medicaid Services (CMS) that improperly claimed Louisiana sales tax costs. CMS then used those PDE claims to calculate Medicare payments to Part D sponsors with whom Argus contracted, which improperly increased reimbursement to the sponsors. Senior Counsel Christina McGarvey and Senior Counsel John O’Brien represented OIG in this case.

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