Massachusetts AG Finds More Drug Overcharges in Workers’ Compensation

Pharmacy benefits manager Express Scripts, Inc. has agreed to pay $3.2 million after allegedly failing to follow prescription pricing procedures intended to keep costs down and prevent overcharges in the state’s workers’ compensation insurance system, according to Massachusetts Attorney General Maura Healey.

This case is part of an ongoing review by the AG into prescription pricing procedures in the workers’ compensation system. AG Healey said she has reached settlements with Optum Rx in February ($5.8 million), Walgreens in February 2019 ($2.2 million); Stop & Shop in March 2021 ($517,000), and United Pharmacy in November 2021 ($701.000) over workers’ compensation drug pricing among others, with violations totaling approximately $16 million

Under the state’s workers’ compensation system, injured employees are entitled to payments for certain injury-related expenses, in addition to payments for lost wages and compensation for injuries. The system sets limits for the cost of prescriptions for injured workers and requires companies to validate prices against certain regulatory benchmarks before processing their charges.

In a filing in Suffolk Superior Court, the AG alleged that in some circumstances Express Scripts failed to apply various regulatory benchmarks – like the federal upper limit for Medicare and the Massachusetts maximum allowable cost – to its pricing for certain workers’ compensation insurance prescription drug charges. According to the settlement, these failures allegedly occurred on prescriptions filled in Springfield, Boston, and Worcester at Walgreens, CVS, and Rite Aid locations.

The terms of the AG’s settlement require Express Scripts to implement procedures to prevent overcharges workers’ compensation and cooperate with the AG’s monitoring of the company’s future regulatory compliance.