CVS Health Ordered to Pay $290M in Medicare Fraud Case

A federal judge has ruled CVS Health's Caremark unit must pay nearly $290 million for systematically overcharging Medicare for prescription drugs. The penalty—triple the original $95 million damages—reflects the deliberate nature of the fraud under the False Claims Act.

Whistleblower Sarah Behnke, a former Aetna actuary, exposed how CVS manipulated drug pricing data. The scheme caused insurers to submit inflated claims to Medicare while shortchanging pharmacies—a breach Judge Mitchell Goldberg called 'a direct attack on public trust.'

This judgment compounds CVS's legal troubles, coming weeks after regulatory scrutiny of its Omnicare division. The case underscores systemic vulnerabilities in Medicare's reliance on third-party pricing data from pharmacy benefit managers.