CVS Health’s Oak Street Health unit has agreed to pay a $60 million settlement to resolve allegations of kickbacks. The Justice Department announced the settlement on Wednesday, alleging that Oak Street paid insurance agents incentives to encourage seniors to enroll in its services.
According to a press release, the investigation focused on Oak Street’s “Client Awareness Program,” launched in 2020 with the aim of increasing patient enrollment. Under this program, insurance agents would connect with Medicare Advantage enrollees and encourage them to consider Oak Street’s services. If interested, the agents would refer the enrollees to Oak Street through a three-way call.
For each referred member, insurance agents received a payment of $200. The Justice Department alleges that these payments constituted kickbacks, violating federal law.
The settlement resolves allegations related to the Client Awareness Program, which operated between September 2020 and December 2022. The Justice Department emphasized its commitment to combating illegal practices in the healthcare industry and protecting the interests of federal health care programs and their beneficiaries.
Brian M. Boynton, Principal Deputy Assistant Attorney General of the Justice Department’s Civil Division, stated, “Health care providers that attempt to profit from kickbacks will be held accountable.” He added that the department is dedicated to rooting out such practices and ensuring that Medicare Advantage providers, insurance agents, and brokers act in the best interests of patients.
“We are committed to rooting out illegal practices committed by Medicare Advantage providers, insurance agents and brokers that undermine the interests of federal health care programs and the patients they serve,” Boynton said.
It’s important to note that the allegations predate CVS’ acquisition of Oak Street Health, which was finalized in May 2023.
(Hero image credit: CVS/Oak Street Health)
