CVS has agreed to pay the State of Indiana $1.95 million and look more closely at the expiration dates on its pharmacists' licenses.

The state brought charges, claiming that two pharmacists with expired licenses dispensed prescription drugs for several years at CVS Pharmacy Stores.

The case stemmed from an investigation by Attorney General Greg Zoeller's Medicaid Fraud Control Unit (MFCU). It alleged that at different times between 1997 and 2007, CVS employed as pharmacists two individuals whose licenses had expired: Morris "Mo" Skirvin at a store in Nashville, Ind., and Edward Certain at a store in Marion, Ind.

According to the investigation, Skirvin's pharmacist license expired in 1990, long before his employer Hook-SupeRx was acquired by CVS, but he did not renew the license and allegedly forged a new one each renewal period.

After MFCU began investigating Skirvin's license, CVS came forward and disclosed that another pharmacist, Certain, also had been practicing without a license. Certain had a valid license at one time but it expired in 2002 and he did not renew it, MFCU found.

Together, Skirvin and Certain filled an estimated 60,778 prescriptions, the investigation alleged, and the Indiana Medicaid program was over-billed for fees to which the unlicensed pharmacists were not entitled.

"When consumers get prescriptions filled, they do so trusting that the person behind the pharmacy counter dispensing medication is up to date on their licensing. That trust was violated by these two individuals," Zoeller said. "To its credit, CVS has resolved this situation in a responsible way: First it came forward and acknowledged that a pharmacist with an expired license had been employed at its Marion store. Now CVS will implement a screening program to ensure that none of its pharmacist employees are operating without a license."

As part of the settlement, CVS also agreed to set into motion several consumer protections: It must verify that pharmacist employees and contractors have valid Indiana pharmacist's licenses. CVS must require applicants for pharmacist positions to disclose any aliases they have used and whether they are ineligible to hold a license.

Within 90 days of the agreement's approval, CVS will perform records checks on its Indiana pharmacist employees through the Indiana Professional Licensing Board to verify that all are appropriately licensed. The company will perform similar checks every six months for three years, the agreement says.

This week the Indiana Board of Pharmacy approved a related licensing agreement with CVS that was connected to CVS's agreement with the Attorney General's Office.

The $1.95 million settlement with the State, to be paid within 60 days, is not considered a fee or a fine or an admission of wrongdoing; and it will be used to reimburse the Indiana Medicaid program and investigative costs, Zoeller said.