Mount Sinai alleges that CVS diverted federal 340B prescription drug funds that should offset drug costs for patients who cannot pay full price. The suit claims CVS directed more than $121 million into its own coffers since 2020 through a “secret pricing scheme.” Mount Sinai says it is entitled to receive discounts from drug manufacturers and use the savings to support its charitable mission. The complaint alleges CVS pocketed the difference between the drug’s actual cost and an adjusted cost after Medicaid reimbursement, rather than reimbursing Mount Sinai for that difference. The suit asserts the alleged losses harm funding and programs serving the poorest and most vulnerable patients. CVS declined to comment on the litigation.
"CVS is taking money that should be going to Mount Sinai and other hospitals serving low-income and uninsured patients under a federal program, according to a suit filed by Mount Sinai on Monday in Manhattan federal court. The money in question should be received by Mount Sinai through a federal program, known as 340B, to offset the cost of prescription drugs for patients who can't pay full price, its suit says. But CVS, which distributes those drugs, has directed over $121 million of the funds into its own coffers since 2020 in what Mount Sinai calls a secret pricing scheme, leaving the healthcare provider without critical support."
"[Mount Sinai] is entitled to receive discounts on drug costs from drug manufacturers, and channel the savings from those discounts to fund their charitable mission of providing quality medical care to those in need, says the hospital's suit, which charges CVS with racketeering, fraud, breach of contract and unjust enrichment. These losses directly impact [Mount Sinai's] funding and programs to provide clinical care to the poorest and most vulnerable patients the intended beneficiaries of the 340B Program."
"The alleged secret pricing scheme goes something like this, Mount Sinai says: CVS's various subsidiaries receive an initial payment for drugs from patients or Mount Sinai, and receive reimbursement for those same drugs from Medicaid. The healthcare provider argued that CVS should then reimburse Mount Sinai for the difference between the drug's actual cost (what patients and hospitals are paying for it) and its adjusted cost after CVS is reimbursed by Medicaid. Instead, CVS is essentially pocketing that difference, not giving it to Mount Sinai to offset the cost of drugs and other care patients can't afford, like it's supposed to, the hospital alleges."
"When asked about the suit, CVS said it doesn't comment on ongoing litigation and remains focused on serving our customers and executing our business priorities."
#340b-program #prescription-drug-pricing #healthcare-fraud-allegations #medicaid-reimbursement #hospital-charitable-care
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