Whistleblower lawsuits complain that a regulatory loophole allows some pharmacy companies to resell drugs returned by nursing homes and hospitals, and thus billing the government twice. Many of these medications were prescribed for residents who died.
A majority of states allow nursing homes and other long-term care facilities to return medications still sealed in original packing and stored in a controlled environment to prevent drugs from being destroyed needlessly.
However, instead of simply preventing waste, the lack of legislation preventing such practices provides for doubly charging the government, the lawsuits claim. Pharmacy providers such as Omnicare have protested.
Most states ban reselling drugs once they have met the hands of people other than healthcare professionals. The 3rd U.S. Circuit Court of Appeals in September discredited the practice but could not find laws to prevent Medicaid from being wrongfully charged.
