Feds allege McKesson part of Medicare fraud scheme

The Justice Department said in a statement it is taking over a case brought by company whistleblowers against McKesson and Golden Horizons nursing homes. Medicare is the largest health care provider in the nation and covers roughly 44 million seniors.

According to the Justice Department, Golden Horizon billed the government for supplies that were actually supplied by McKesson through a bogus company. Under the agreement, McKesson was able to bill the government for millions of dollars and pass on some of the profits to Golden Horizon. In return, the nursing home company agreed to use McKesson for all its medical supply needs.

The case was originally filed by a whistleblower in U. S. District Court in Mississippi. Employees who help the federal government recover funds are entitled to a portion of that money.

McKesson said in a statement it has not yet seen the government's specific complaint, but "we have been cooperating in the investigation for several years."

"We continue to believe the case is without merit and we will vigorously defend against it," according to the San Francisco-based company.

Shares of McKesson fell $5.47, or 11.2 percent, to $43.39 in afternoon trading.