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Cuomo announces 'second legal front’ against opioid industry, says state will recover $2 billion over ‘diabolical’ drug scheme


Insurance companies bilked New Yorkers out of $2 billion by overcharging them premiums and blaming it on the opioid epidemic, Gov. Cuomo said Tuesday.

The state Department of Financial Services has issued a laundry-list of subpoenas as part of an investigation into the insurance fraud scheme, the governor said. That’s on top of Attorney General Letitia James’ sweeping lawsuit against several opioid producers.

The $2 billion scheme, as explained by Cuomo, has played out over the past 10 years and involves drugmakers in cahoots with distributors and pharmacy benefit managers to downplay the risks of prescription painkillers and flood the market with the narcotics despite knowing how addictive and dangerous they are.

In turn, New York taxpayers have had to cover health insurance premiums that Cuomo said have skyrocketed because of costs associated with the opioid epidemic, including addiction treatment and other health issues stemming from drug use.

The alleged scam was uncovered when DFS combed through insurance companies’ records, according to agency supervisor Linda Lacewell.

The DFS investigation, which Cuomo described as a “second legal front,” will eventually materialize in a lawsuit, but he did not say when.

“I’ve seen a number of schemes and frauds, but the opioid scheme is as diabolical, as brazen, as obnoxious and as offensive as anything I’ve seen,” Cuomo said. “It was an industry-wide conspiracy... It has cost thousands of human lives and billions of dollars, and they have gotten away with it for decades."

“We’re going to make sure that justice is done,” the governor said. “These drug companies are not going to get away with murder.”