McGraw: Feds wrong to take settlement funds

By John O'Brien | Oct 21, 2010


RICHMOND, Va. -- State Attorney General Darrell McGraw is telling a federal appeals court that the federal government lacked the authority to take $450,000 from one of his settlements with a pharmaceutical company.

On Oct. 13, McGraw filed his reply to the government's response to his appeal of two lower rulings that said the feds were owed that amount from an $850,000 settlement with Dey LP that was reached in 2004. McGraw also argued that the $100,000 he set aside for his Consumer Protection Fund shouldn't have been subject to recovery.

A Departmental Appeals Board and a federal judge in Charleston, W.Va., have both sided with the federal Department of Health and Human Services in the dispute.

McGraw is claiming that there is no "explicit statutory authority and no implementing regulation" that requires him to pass on recovery from third parties on Medicaid damages claims. The federal government supplies the majority of funding for West Virginia's Medicaid program.

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