Boston, MA — The Massachusetts Attorney General’s Office (AGO) has announced settlements with two independent pharmacies—Granby-based Center Pharmacy and Dorchester’s Galaxy Pharmacy—over allegations of submitting false claims to MassHealth, the state’s Medicaid program. In total, the two pharmacies will pay more than $500,000 in restitution to the Commonwealth as part of the agreements. Additionally, both pharmacies will implement a three-year independent compliance monitoring program to prevent future violations.
Center Pharmacy will pay $230,000, while Galaxy Pharmacy will pay $270,000, for a combined total of $500,000. The funds will be used to reimburse MassHealth for the false claims submitted by the pharmacies. In addition to the financial restitution, the settlements require both pharmacies to update their policies and procedures, conduct staff training, and undergo annual audits for three years.
The Massachusetts AG allegedly reached separate settlements with two independent retail pharmacies, Granby-based Granby Pharmacy, Inc., also known as Center Pharmacy (“Center Pharmacy”), and Boston-based Atlas Pharmahealth, Inc. d/b/a Galaxy Pharmacy (“Galaxy Pharmacy”), resolving allegations that the pharmacies submitted false claims to MassHealth, the state’s Medicaid program
The AGO’s investigation revealed that Center Pharmacy, located in Granby, submitted false claims for expensive prescription vitamins between August and October of 2023. The pharmacy allegedly misrepresented to physicians that elderly nursing home patients had requested the vitamin Profola, when, in fact, they had not. Over a three-month period, Center Pharmacy submitted 72 claims for Profola for 51 individuals, leading to over $116,000 in reimbursement from MassHealth.
At the same time, Galaxy Pharmacy in Dorchester was found to have submitted unlawful claims for prescription refills that were not explicitly requested by MassHealth members or their caregivers. The pharmacy allegedly engaged in this practice since 2018, despite state law prohibiting MassHealth from paying for such automatic refills without prior request.
As part of the settlements, both pharmacies are required to implement comprehensive compliance programs to ensure they adhere to MassHealth guidelines moving forward. These programs will include updated policies and procedures, as well as training for staff on compliance measures. Additionally, both pharmacies will undergo annual audits, which will be conducted by independent third parties.
“Pharmacies play a critical role in providing essential services to Massachusetts residents, and those who engage in fraudulent billing undermine the integrity of the MassHealth program,” said Massachusetts Attorney General Andrea Campbell. “These settlements demonstrate our commitment to holding those who abuse the system accountable and protecting taxpayers from fraud.”
The Medicaid Fraud Division, which investigates and prosecutes health care providers who defraud MassHealth, has successfully resolved numerous cases in recent years. For instance, in November 2021, the AGO reached an $800,000 settlement with Bravo Pharmacy, which was found to have inappropriately refilled medications, including an expensive multivitamin called Hylavite. Similarly, in 2020, the AGO settled for $500,000 with Remedium Pharmacy over the improper automatic refilling of compounded pain creams.
The AGO’s Medicaid Fraud Division is annually certified by the U.S. Department of Health and Human Services to investigate and prosecute healthcare fraud. The division also investigates cases of abuse, neglect, and financial exploitation of patients in long-term care facilities and those enrolled in MassHealth.
The Medicaid Fraud Division receives 75% of its funding from the U.S. Department of Health and Human Services, totaling $5.9 million for federal fiscal year 2025, with the remaining 25% provided by the Commonwealth of Massachusetts.
