CVS Health Corp. and its subsidiaries are facing claims they pocketed over $200 million in overpayments from federal programs after a former compliance director’s False Claims Act (FCA) lawsuit survived a motion to dismiss. The case, filed by whistleblower Michael Gill, will proceed after an Illinois federal judge on Monday allowed significant portions of the suit to continue.
CVS $200M Federal Claims : Allegations of Fraud and Retaliation
Michael Gill, who worked for CVS for decades, filed the lawsuit in 2018, accusing CVS and its subsidiaries of engaging in fraudulent schemes to record millions in overpayments from federal programs as income. Gill also alleged that the company retaliated against him for raising concerns. The whistleblower claimed that CVS used the inflated earnings to pad its adjusted earnings and avoid market consequences.
Court Allows Key Claims to Move Forward
In his ruling, U.S. District Judge Steven C. Seeger found that Gill had sufficiently detailed allegations of overpayments to support FCA claims under federal and Delaware laws. While CVS argued that the overpayments primarily came from commercial payers, Judge Seeger noted the complaint implied government programs were also involved. “‘Primarily’ implies the opposite of ‘entirety,’” Seeger wrote, allowing the claims to proceed.
