Walgreens has agreed to pay $360 million to insurance company Humana to settle a lawsuit claiming that the retail pharmacy chain overcharged for prescription drug reimbursements.
In 2019, Humana brought a lawsuit against Walgreens arguing that the company had overcharged its customers by inflating medication prices for over ten years. Humana alleged that the pharmacy chain made that lower pricing available without accounting for it in its customary prices, which led to higher claims payouts. In 2021, an arbitrator awarded Humana a $642 million settlement which Walgreens contested, describing the ruling as a “miscarriage of justice.” The companies have now settled on a $360 million payout, $150 million of which was paid off last month.
Humana specifically claimed that Walgreens provided substantial discounts on its drugs to customers through its Pharmacy Savings Club but didn’t include those sales in its regular prices reported to insurers, causing an increase in claims. Walgreens has explicitly denied these claims and argues that their deals with Humana only require them to report regular retail prices, not the special rates for club members. The pharmaceutical company claims that the arbitrator deciding the case didn’t understand their agreements correctly and was partially biased due to his financial ties with Humana’s legal team.
While securing this settlement with Humana, Walgreens continues to face legal actions, including a lawsuit from Blue Cross Blue Shield alleging the inflation of prescription drug claims. The pharmaceutical giant has completed a large number of expensive legal settlements over the past years, including some that result from Walgreens’ involvement in the opioid epidemic. 
Jacob Horowitz is a contributing editor at Compliance Chief 360°