The Department of Justice (DOJ) issued a press release announcing a civil and criminal settlement worth $161 million with Caremark Inc. The Inspector General of the U.S. Department of Health and Human Services led the investigation and was assisted by the FBI.

Caremark, Inc. is a subsidiary of Caremark International, a large Illinois-based health care company. The company will plead guilty to charges of kickbacks and fraud, in its home infusion, hemophilia, oncology and human growth hormone businesses.

The $161 million consists of a combination of criminal fines, restitution, and damages for the kickbacks and fraud.

Attorney General Janet Reno said the payment is one of the biggest ever received in a healthcare fraud case. "Health care fraud robs from all of us," Reno added "by distorting medical judgments, boosting health care premiums, and increasing the cost of taxpayer supported government health care plans."

In separate cases in Minnesota and Ohio, Caremark consented to plead guilty to two one-count informations. Those informations charged the company with defrauding federal programs by making inappropriate payments to get doctors and other professionals to refer patients to Caremark.

The fines in the Medicaid fraud case broke down like this: Caremark will pay a criminal fine of $9 million related to the information filed in Minneapolis plus a fine of $20 million in connection with its criminal activities in Columbus.

The company also agreed to make a contribution of $2 million to the Public Health Service. This money will fund the treatment of HIV/AIDS in youth.

Estimates made by the General Accounting Office (GAO) peg health care fraud to cost tens of billions each year.

Caremark negotiated with the National Association of Medicaid Fraud Control Units and agreed, in principle, to pay $45 million to states for their share of Medicaid and various state health care programs.

In addition, Caremark agreed to pay over $3 million for a failure to keep accurate pharmacy records at its pharmacies, a breach of the Controlled Substances Act.

Have information on Medicaid Fraud?

If you have information about Medicaid fraud, contact the Medicaid Fraud Reporting Center for a confidential claim evaluation today. You may report Medicaid fraud by completing the form on this page, or by calling our Medicaid Fraud Hotline at 1-800-934-2921.