Kmart Corp. to pay $2.55M in federal settlement

Written by  //  October 23, 2013  //  In-Brief  //  No comments

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Puerto Rico will receive more than $34,000 as part of an agreement between other states, territories, and the federal government and Kmart Corp. (Credit: © Mauricio Pascual)

Puerto Rico will receive more than $34,000 as part of an agreement between other states, territories, and the federal government and Kmart Corp. (Credit: © Mauricio Pascual)

Puerto Rico Justice Secretary Luis Sánchez-Betances announced Tuesday that the island will receive more than $34,000 as part of an agreement between other states, territories, and the federal government and Kmart Corp. to settle allegations that Kmart submitted false claims and false statements through its Kmart Pharmacy Centers to the federal government, state governments, and territories for payments relating to partial fills of prescriptions.

Kmart will pay the states, the territories, and the federal government a total of $2.55 million in civil damages and penalties to compensate Medicaid, Medicare, and various federal healthcare programs for harm suffered as a result of its conduct.

The lawsuit asserts that Kmart violated the federal False Claims Act by returning to stock and failing to delete or re-adjudicate prescriptions that were billed to federal health insurance programs but were not picked up by customers.

This settlement is based on a qui tam case that was filed in the U.S. District Court for the Eastern District of Michigan by a private individual who filed the action under the federal false claims statute. As part of the settlement, Puerto Rico will also receive restitution, the retailer said.

A National Association of Medicaid Fraud Control Units team participated in the settlement negotiations with Kmart on behalf of the settling states. Team members included representatives from the Offices of the Attorneys General for the states of Florida, Indiana, New York, and North Carolina.

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