Walgreens Accused Of Scamming Taxpayers

(CBS)  It's America's biggest drugstore chain.

"Beyond the reach of cell phones and superhighways, there's a place called 'perfect,'" rings the familiar ad for Walgreens.

In a perfect world, however, Walgreens wouldn't be accused of ripping off taxpayers. But we're nowhere near perfect. CBS News investigative correspondent Sharyl Attkisson reports.

Michael Behn, a former federal prosecutor, said, "The pharmacies nationwide had a pill flipping scheme."

Behn helped expose how Walgreens exploited a Medicaid loophole.

To save taxpayer dollars, Medicaid limits how much it pays for popular forms of drugs.

But it doesn't bother to set price-ceilings on rarely-used versions.

Take generic Zantac, or ranitidine, for example. The antacid is a huge seller in tablet form. Medicaid limits payment to 34 cents apiece.

The same drug as capsules has no price-ceiling because it was so rarely-prescribed. Medicaid pays $1.25 each.

Walgreens figured it could pocket millions by switching patients from tablets to capsules.

Behn explained to Attkisson, "These are the ranitidine capsules."

"This is what was being prescribed?" Attkisson asked, pointing to the tablets. "And this is what was being given?" pointing to the capsules.

Behn replied, "Correct. At three times or more the cost to taxpayers," Behn answered.

The scheme was blown wide open by a whistleblower, a pharmacist who doesn't want to appear on camera. He said Walgreens rigged its computers to automatically switch to the most expensive type of pill.

"The only way in which a computer system could switch from a tablet and a capsule, is if someone went in and manipulated the computer system," Behn said.

Attkisson asked, "And the fact that this was done nationwide indicates this was a corporate policy?"

Behn responded, "That's what we alleged."

By gaming the system, Walgreens managed to change over almost all Medicaid customers from cheap generic Zantac tablets to pricy capsules.

In Florida alone, it cost taxpayers an extra $1.2 million the first year.

And the pill-switching went on for several years nationwide, including other prescriptions: generic Prozac (fluoxetine) for depression, and generic Eldepryl (selegiline) for Parkinson's.

Walgreens denies wrongdoing and declined to be interviewed.

But they recently agreed to pay back the government more than $35 million.

And they're not the only ones. CVS and Omnicare quietly settled similar cases coughing up $86 million more.

The whole pill-flipping episode proves just how imperfect some drugstore chains can be.

[rx2008]

First off it is NOT LEGAL for a Pharmacist to just change over a tablet to a capsule with out consulting the provider, even if it is the same medication pharmacy law, not the pharmacy. Maybe CBS should do the research and know what they''re talking about before makes assumptions.
Second if it cost more for the pharmacy don''t you think it would cost more for the patient?
The thing that gets me most about the news is how they always give only half the story. Way to go CBS

[payasyougo]

"What the news here, this is "business as usual" from the pharmaceutical world. If they get caught, they settle immediately and pay a big fine. No one ever goes to jail, they are immune to crimes because of their deep pockets."
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Along with business as usual in government who takes this opportunity to raise revenue for themselves.

Are you and I, the people that paid the higher cost in copays and probably increased following year insurance costs going to see any money back? No.

[lynnej-2009]

It is the greed of the corporations and their political friends who let them get away with it. The needs of the many does not enter here. It is the needs of the few that do, and in this case, it''s money, plan and simple. People are worth $20 million or more and are still looking for ways to screw us hard working decent people.

The entire system of getting meds is a mess. I use ranitidine and get them for $4 bottle at Walmart.

What''s bugging me is that if Walmart can make a deal with the drug companies to sell generics at $4 a pop, why can''t the pharmacies do the same? It is the same pills. How much money is enough? Greed has not bounds.

[baileyccc]

What the news here, this is "business as usual" from the pharmaceutical world. If they get caught, they settle immediately and pay a big fine. No one ever goes to jail, they are immune to crimes because of their deep pockets.

[oneworldusa]

Posted by txgrouch2004 at 12:06 AM : Jun 16, 2008

LOL, silly little fairy, my home is paid for, thank you. Because I am well-educated, responsible, and don''t expect my government to give me handouts, I do much better than you ever will. You people!

[txgrouch2004]

USAUberAlles taunted
getting to work would cost me around, well, $10/week.
-------------
I see. So your "healthcare" job at Target pays so little that you can''t afford housing. So you actually LIVE at the store, sleeping in a bed hidden in a cardboard box in the back room.

You should get out more. Wal-Mart still has a few "Made in USA" items. Not that I actually BELIEVE that the wokers who made them are all here legally...

[oneworldusa]

"then wnat work DO you do "in healthcare???"
Posted by txgrouch2004 at 10:31 PM : Jun 15, 2008

-And YOUR spelling is atrocious....maybe if you got an education you wouldn''t feel so oppressed that you have no better dignity than to act out against others. No wonder no one will offer you a good job.

Go to school, change your attitude, and perhaps, someday someone will feel sorry enough for you to offer you an opportunity so you won''t spend all your time complaining what the government isn''t giving you.

[lochlan-2009]

"The whole pill-flipping episode proves just how imperfect some drugstore chains can be"

Or how incapable of doing their jobs representing "the people" our legislators are, intentional or not.

[oneworldusa]

Posted by txgrouch2004 at 10:31 PM : Jun 15, 2008

LOL! Did I address you? NO! It''s obvious you are jealous. Let me give you a little more to be jealous about, then, since your hunger for arguing, complaining, and playing the victim is so great.

-LOL. I don''t pay for prescriptions because my company does. I don''t pay co-pays, either, and I make much more than enough that $4 gas doesn''t bother me one bit. Routine annual exams, screenings, flu shots? Free.

I hope for you, gas goes up to $10/gallon. With a 6 mile round trip commute to work, and 30mpg (I actually get 31.8, but who is counting, right?), getting to work would cost me around, well, $10/week.

[txgrouch2004]

USAUberAlles wrote
I work in healthcare and am horrified to see this type of practice exists.
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BWAHAHA! If you didn''t know about the RAMPANT PRICE GOUGING that is COMMONPLACE in pharmacies - then wnat work DO you do "in healthcare???"

Oh, I get it - you have a minimum wage job STUFFING THE COTTON IN THE BOTTLES at Target... while you spend the day learning to badmouth Wal-Mart, which is A BETTER STORE THAN TARGET HAS EVER BEEN.