Online birth control provider The Pill Club agrees to $18.3 million settlement over alleged insurance fraud
The Pill Club, a San Mateo-based company that provides online birth control prescriptions, has reached an $18.3 million settlement with California authorities over claims it defrauded the state's Medi-Cal program of millions of dollars in fraudulent insurance claims.
The California Department of Justice said The Pill Club defrauded Medi-Cal of millions of dollars by dispensing and reimbursing for costly birth control products that customers had not asked for, prescribing birth control pills without adequate consultaiton, and submitting reimbursements for ineligible services and prescriptions.
The settlement calls for the state Department of Justice to be paid $15 million, while $3.3 million will go to the state Department of Insurance. Two of the company's former nurse practitioners who filed a whistleblower complaint against The Pill Club will also share nearly $5 million from the two state settlements, according to California Healthline.
"The Pill Club unacceptably siphoned off Medi-Cal funding intended to help vulnerable communities access essential healthcare," said Attorney General Rob Bonta in a prepared statement. "I am grateful to the whistleblowers and our investigators who were instrumental in holding The Pill Club accountable. At the California Department of Justice, we fight every day to protect and expand access to healthcare. We will not tolerate companies who attempt to unlawfully enrich themselves at Medi-Cal's expense."
California Insurance Commissioner Ricardo Lara said that The Pill Club allegedly falsely billed for the nurse practitioners' review of the online questionnaires by claiming that the review was an in-person patient visit and that the visit lasted 16-30 minutes.
In addition, Lara said The Pill Club allegedly submitted false claims to health insurers for reimbursement for FC2 female condoms that patients did not want and were not medically necessary.
"Fraudulent insurance claims and dispensing products and medications that are unwanted and not medically necessary only serves to increase costs for consumers and on the entire insurance marketplace," said Lara in a statement. "Protecting reproductive rights is vital, and this settlement protects patients and the marketplace."
With the settlement, The Pill Club avoids any admission of liability and it has denied any wrongdoing.
"When I joined The Pill Club just over two years ago, I was drawn to the challenge of strengthening our operations to live up to our mission," said Liz Meyerdick, chief executive officer of The Pill Club, said in a prepared statement. "I'm glad to have the opportunity to resolve these issues and to bring our full focus back to expanding access to contraceptive care for all who need it."