LOUISVILLE, Ky. (WDRB) -- A Kentucky judge ruled Humana must pay a San Francisco law firm $32 million in attorney fees more than a year after it settled a whistleblower lawsuit for $90 million.
According to reporting from our partners at Louisville Business First, Louisville-based Humana Inc. was ordered by U.S. District Court Judge Greg Stivers to pay that amount to Phillips & Cohen LLP, the attorneys for a whistleblower.
The ruling was made earlier in September.
The firm represented Steven Scott, a former actuary, in a whistleblower lawsuit filed in 2016 by Phillips & Cohen LLP under the False Claims Act. Humana settled the case in 2024 for $90 million.
Humana was given until Sept. 24 to make the $32 million payment, according to a court filing, but it's not clear if the company honored that deadline.
The lawsuit claimed that Humana overcharged the government by using fraudulent bids to the Centers for Medicare & Medicaid Service (CMS), which handled Medicare Part D prescription drug contracts from 2011-17.
Medicare Part D helps some Medicare recipients cover the cost of prescription drugs. Enrollees typically pay an annual deductible and copays for their prescriptions through private insurance approved by Medicare and handled by CMS.
Insurance companies submit annual bids to CMS to give projections about what prescription costs it will cover and whether it meets federal requirements. The complaint in this case claimed Humana wasn't truthful about meeting the required coverage. The lawsuit said the healthcare giant planned to pay less and allowed beneficiaries to pay more without them knowing.
The complaint alleged Humana submitted bids to the government that were based on unsupported information, but the company already had accurate internal projections for the Part D "Walmart Plan." According to the suit, the bids were off by hundreds of millions of dollars in Humana's favor.
Records filed with the district court claimed that shortly after Humana received the Civil Investigative Demand the government issued when investigating this case, the alleged practice of using separate sets of assumptions abruptly ended, reducing future harm to the government.
The lawsuit is related to a downgrade in Humana's star rating of its largest Medicare plan that could cost the company billions.
Humana, Louisville's largest publicly traded company, didn't immediately respond to Louisville Business First's request for comment. This story could be updated.
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