Home Criminal Defense Seven insurers sue CVS for allegedly inflating drug costs – MedCity News

Seven insurers sue CVS for allegedly inflating drug costs – MedCity News


A new lawsuit — the second within the span of a 12 months — alleges CVS overcharged well being insurers for prescribed drugs, pocketing billions of money. But CVS shot again, saying these allegations are “baseless” and “completely without merit,” in an emailed assertion.

The plaintiffs — CareFirst of Maryland, Group Hospitalization and Medical Services, CareFirst BlueSelection, Blue Cross and Blue Shield of South Carolina, BlueSelection HealthPlan of South Carolina, Blue Cross and Blue Shield of Louisiana and HMO Louisiana — filed a lawsuit final week within the U.S. district court docket in Rhode Island. This is the second such lawsuit to be introduced towards CVS over the previous 12 months. Last May, six Blue Cross Blue Shield corporations sued CVS over drug pricing.

Woonsocket, Rhode Island-based CVS deliberately engaged in a fraud scheme to overcharge insurers for prescribed drugs by submitting claims at artificially inflated costs, the brand new lawsuit claims.

Through its Health Savings Pass Program, which was later changed by the Value Prescription Savings Card Program, CVS supplied a whole bunch of generic medicine at low, discounted costs. These packages served two functions, the lawsuit alleges. First, the packages have been supposed to assist CVS compete for money prospects. The second was to cover the true costs of the medicine from third-party payers, together with the plaintiffs.

“CVS intentionally told third-party payers, including Plaintiffs, that the prices charged to cash customers for these generic drugs were higher — often much higher,” the lawsuit states.

Consequently, the insurers paid CVS at charges that have been much larger than the precise costs that CVS was providing its prospects.

“CVS has now pocketed billions of dollars in ill-gotten gains through this unlawful scheme —  including millions from Plaintiffs,” the go well with states.

The business hid its fraudulent scheme for years, the insurers declare within the lawsuit. In an effort to keep away from submitting its discounted worth on claims because the “usual and customary” worth, the pharmacy big created the Health Savings Pass Program.

They described it as a membership program, despite the fact that it was primarily a money program, with CVS even permitting non-members entry to discounted drug costs, the insurers declare.

In 2016, the corporate changed the Health Savings Pass Program with the Value Prescription Savings Card Program, which was comparable however didn’t embrace a membership charge. Once once more, the discounted money costs for medicine supplied via this system have been additionally supplied to most of the people, the lawsuit alleges.

But CVS refuted the allegations, stating that the preliminary HSP program was a membership program supposed for purchasers who both didn’t have or selected to not use insurance coverage, whereas the latter VPSC program is a prescription drug card program supplied and administered by a 3rd get together.

“Generic drug prices available through these programs were not the usual and customary price charged by CVS Pharmacy, nor the price available to the general public,” mentioned Mike DeAngelis, senior director of company communications at CVS Health. “Neither of these programs were in any way concealed, nor fraudulent.”

The plaintiffs are in search of an award amounting to twice what they have been overcharged, together with injunctive aid.

Photo: photovs, Getty Images




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