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State Auditor: Settlement has put Centene on notice

State Auditor Shad White. Photo by News Mississippi

Centene has agreed to pay Mississippi $55.5-million in a no-fault settlement after an investigation into  claims that the company’s Pharmacy Benefit Managers (PBM’s) were inflating their bills.  The company is also paying $88-million to settle a similar investigation in Ohio.  Centene is the largest Medicaid managed care organization in the country, and the parent company of Magnolia Health.

State Auditor Shad White–during an interview on The Gallo Radio Show on SuperTalk Mississippi this morning–believes the investigation puts the company on notice.  “The overpayments were happening through subunits of Centene,” White explained.  “The assumption is, oh well nobody’s getting a look at these payments or this over billing that’s happening, because it’s happening all internally inside Centene.  Well, now they know that we have access to that, and we’re looking at it.”

So is it a conflict of interest for Centene and its subsidiaries to set prices AND oversee the program?  “PBM’s are these massive, big corporations.  They set up this business model.  The business model basically is being a middle man,” White continues.  So can you own a PBM and own a managed care organization and be a big umbrella company and not have a conflict?  “Here’s the perspective I take as State Auditor.  If there’s something going wrong, if they’re over billing or keeping more money than they should or whatever it is, my job is to find it   My job is to go out there, identify the amount of money and get it back.  The bigger questions of should PBM’s exist at all?  That’s such a massive question for the country that I honestly think that the Federal Trade Commission is going to have to think about it.  Attorneys General around the country are going to have to think about it.”

White tells us now that we’re seeing these big settlements, he thinks it’s time for all the Medicaid programs across the country to take a step back and ask if it’s worth it.




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