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Kmart Settles Drug Billing Charges For $2.55M

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(credit: FREDERIC J. BROWN/AFP/Getty Images)

(credit: FREDERIC J. BROWN/AFP/Getty Images)

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DETROIT (WWJ/AP) – Federal prosecutors in Detroit say that the Kmart discount chain has agreed to pay $2.55 million to settle complaints that it overbilled government health programs when it partially filled drug prescriptions.

U.S. Attorney Barbara McQuade said Monday that the settlement includes payments to the U.S., 30 states, Puerto Rico and the Virgin Islands.

Kmart is based in the Detroit suburb of Troy and is part of Hofman, Ill.-based Sears Holdings Corp.

McQuade says Kmart violated the False Claims Act by billing Medicaid, the Federal Employee Health Benefits Program and other health programs for all drugs included in a prescription in cases when it dispensed only part of the prescribed drugs.

She says Kmart returned the drugs to inventory.

“Cases like this one help ensure that health care program funds are used for the benefit of patients and not instead lost in the bureaucracy of large pharmacies,” McQuade said in a statement.

The U.S. says ex-Kmart pharmacist Mark Kirsch gets a $310,000 whistleblower reward.

The case was investigated by special agents of the FBI and special agents of Health and Human Services – Office of Inspector
General with the assistance of the Department of Defense, Office of Inspector General, Defense Criminal Investigative Service, and the U.S. Office of Personnel Management, Office of the Inspector General.

(TM and © Copyright 2013 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2013 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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