Pharmacists ask regulators to examine CVS Caremark

[JackFruitLover]

Pharmacists ask regulators to examine CVS Caremark

By TOM MURPHY
MORE FROM BUSINESSWEEK

INDIANAPOLIS

A pharmacists association on Wednesday accused CVS Caremark Corp. of waging unfair competition and asked for a Federal Trade Commission investigation.

The National Community Pharmacists Association has accused Woonsocket, R.I.-based CVS of using sensitive patient information and copayment manipulation to steer patients to its pharmacies and drug mail-order businesses. The Alexandria, Va.-based association met with the Federal Trade Commission and also has talked to members of Congress.

"We believe CVS Caremark is taking away fundamental rights of patients to choose their own pharmacy, and that message is getting a very receptive ear on Capitol Hill," said John Coster, the association's senior vice president of government affairs, during a conference call with reporters.

CVS said in an e-mailed statement the association mischaracterizes its business practices.

The company bought Caremark in 2007 in a deal worth more than $26 billion. CVS runs more than 6,900 retail pharmacies, and Caremark manages drug benefits for health plan sponsors and members.

Association spokesman Kevin Schweers said CVS uses the possibility of higher copayments to push customers to switch from community drug stores to a CVS store or its mail-order business.

The association, which represents mostly independent pharmacies, provided several examples of letters it said were sent from CVS to benefits plan customers telling them that prescriptions will either no longer be filled at another store or they will be subjected to higher copayments.

The letters also mention potential savings on 90-day prescriptions filled through either a CVS pharmacy or its mail-order business.

Schweers also said CVS can use pricing and patient data it collects through Caremark to market to people who don't use CVS pharmacies. He said nothing prevents CVS from mining all the data it receives for useful information.

"It's a one-way street," he said. "Because Caremark is so huge, they have information not just on the other stores but on all of the people that they cover.

"No community pharmacy or other rival has any similar access to that kind of data."

Pharmacies have to send sensitive business and patient information to Caremark in order to bill a patient's insurer, said association president Holly Whitcomb Henry. The association would like to see a firewall established to prevent CVS from using the information for marketing.

Whitcomb Henry said the association presented several examples to the Federal Trade Commission, and she was "cautiously optimistic."

A commission spokeswoman declined to comment.

CVS said it its statement that the Caremark deal makes "pharmacy health care more accessible, more effective and more affordable."

"Our integrated pharmacy and PBM operations provide greater choice and more convenience for patients, improve health outcomes and lower overall health care costs for plan sponsors and participants," the statement said.

CVS shares fell 3 percent, or $1.03, to $31.95 in trading Wednesday.

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[OTFuturePharmD]

This is rather scarey what CVS is trying to do. CVS has gotten way to big. I would think there would be some HIPPA issues here.

 

[BanBidil]

Hello again doomgloom lover
I was at the FTC meeting in DC for NCPA, with the new chairman LEbowitz, things will change...

Pharmacists ask regulators to examine CVS Caremark

By TOM MURPHY
MORE FROM BUSINESSWEEK

INDIANAPOLIS

A pharmacists association on Wednesday accused CVS Caremark Corp. of waging unfair competition and asked for a Federal Trade Commission investigation.

The National Community Pharmacists Association has accused Woonsocket, R.I.-based CVS of using sensitive patient information and copayment manipulation to steer patients to its pharmacies and drug mail-order businesses. The Alexandria, Va.-based association met with the Federal Trade Commission and also has talked to members of Congress.

"We believe CVS Caremark is taking away fundamental rights of patients to choose their own pharmacy, and that message is getting a very receptive ear on Capitol Hill," said John Coster, the association's senior vice president of government affairs, during a conference call with reporters.

CVS said in an e-mailed statement the association mischaracterizes its business practices.

The company bought Caremark in 2007 in a deal worth more than $26 billion. CVS runs more than 6,900 retail pharmacies, and Caremark manages drug benefits for health plan sponsors and members.

Association spokesman Kevin Schweers said CVS uses the possibility of higher copayments to push customers to switch from community drug stores to a CVS store or its mail-order business.

The association, which represents mostly independent pharmacies, provided several examples of letters it said were sent from CVS to benefits plan customers telling them that prescriptions will either no longer be filled at another store or they will be subjected to higher copayments.

The letters also mention potential savings on 90-day prescriptions filled through either a CVS pharmacy or its mail-order business.

Schweers also said CVS can use pricing and patient data it collects through Caremark to market to people who don't use CVS pharmacies. He said nothing prevents CVS from mining all the data it receives for useful information.

"It's a one-way street," he said. "Because Caremark is so huge, they have information not just on the other stores but on all of the people that they cover.

"No community pharmacy or other rival has any similar access to that kind of data."

Pharmacies have to send sensitive business and patient information to Caremark in order to bill a patient's insurer, said association president Holly Whitcomb Henry. The association would like to see a firewall established to prevent CVS from using the information for marketing.

Whitcomb Henry said the association presented several examples to the Federal Trade Commission, and she was "cautiously optimistic."

A commission spokeswoman declined to comment.

CVS said it its statement that the Caremark deal makes "pharmacy health care more accessible, more effective and more affordable."

"Our integrated pharmacy and PBM operations provide greater choice and more convenience for patients, improve health outcomes and lower overall health care costs for plan sponsors and participants," the statement said.

CVS shares fell 3 percent, or $1.03, to $31.95 in trading Wednesday.

 

[MountainPharmD]

I guess the complaints have fallen on deaf ears. Last week here in Texas we started receiving rejections on Caremark insurance. We would call Caremark and they would tell us the patient needed to call them. A couple of patients called us back and said all Carmark did was try to convince them to go through mail order or get their prescriptions filled at CVS. Once they told Caremark they did not want to switch Pharmacies the rejection magically disappeared..

 

[Doctor M]

I guess the complaints have fallen on deaf ears. Last week here in Texas we started receiving rejections on Caremark insurance. We would call Caremark and they would tell us the patient needed to call them. A couple of patients called us back and said all Carmark did was try to convince them to go through mail order or get their prescriptions filled at CVS. Once they told Caremark they did not want to switch Pharmacies the rejection magically disappeared..

So wait....all the pt has to do is call caremark and caremark cannot force them to go??? Will they copay still be the same or will they charge the pt the full cost of the drug???I hope this gets fixed soon!

 

[Aznfarmerboi]

I guess the complaints have fallen on deaf ears. Last week here in Texas we started receiving rejections on Caremark insurance. We would call Caremark and they would tell us the patient needed to call them. A couple of patients called us back and said all Carmark did was try to convince them to go through mail order or get their prescriptions filled at CVS. Once they told Caremark they did not want to switch Pharmacies the rejection magically disappeared..

Same thing with express scripts..

 

[Doctor M]

Same thing with express scripts..

really, so all the pt has to do is call and complain and all is good??

 

[Old Timer]

This depends on the plan the sponsor signs up for. CVS get's certain data from Caremark like generic utilization for a given store or zip code, but there is a firewall between the Divisions so the store level cannot see what is done at the mail order level and they can't see what goes on at retail. Unlike chain to chain transfers in the system, we need to call Caremark from a CVS store and transfer manually.

The attempt to steer business to their own pharmacies has been a PBM staple for many years and all PBM's, Caremark, Medco, WHI and Express Scripts all do this kind of thing.

There have been exclusive contracts for years and this is really nothing new. Any pharmacist who has been around for a decent number of years knows this is old hat....

 

[weetzie00]

I guess the complaints have fallen on deaf ears. Last week here in Texas we started receiving rejections on Caremark insurance. We would call Caremark and they would tell us the patient needed to call them. A couple of patients called us back and said all Carmark did was try to convince them to go through mail order or get their prescriptions filled at CVS. Once they told Caremark they did not want to switch Pharmacies the rejection magically disappeared..

Is that true? Yeah, those rejections have been overwhelming starting this year it seems. When we call them, they tell us that the patients can only fill maintenance drugs only once at our store, they'd have to go to CVS or mailorder thereafter. If all they have to do is call that number and tell them no, that would fix a ton of issues with the angry customers.

 

[confettiflyer]

Is that true? Yeah, those rejections have been overwhelming starting this year it seems. When we call them, they tell us that the patients can only fill maintenance drugs only once at our store, they'd have to go to CVS or mailorder thereafter. If all they have to do is call that number and tell them no, that would fix a ton of issues with the angry customers.

Yup...this actually just happened to me as a patient. Not that I have any meds to fill, I just got a letter saying all maintenance meds must go to mail order. Also, something about getting charged a higher copay for injectables if you don't go to a CVS (my guess is insulin or other stuff).

I dunno...sucks for independents but I'm seeing shades of Kaiser in the actions of CVS, and I really like Kaiser's model. Hmmm....

 

[PharMed2016]

Yup...this actually just happened to me as a patient. Not that I have any meds to fill, I just got a letter saying all maintenance meds must go to mail order. Also, something about getting charged a higher copay for injectables if you don't go to a CVS (my guess is insulin or other stuff).

I dunno...sucks for independents but I'm seeing shades of Kaiser in the actions of CVS, and I really like Kaiser's model. Hmmm....

Interesting, I hadn't realize that CVS was trying to corner the market this way. I agree with NCPA that something must be done despite the fact that I work for CVS.

 

[MountainPharmD]

This depends on the plan the sponsor signs up for. CVS get's certain data from Caremark like generic utilization for a given store or zip code, but there is a firewall between the Divisions so the store level cannot see what is done at the mail order level and they can't see what goes on at retail. Unlike chain to chain transfers in the system, we need to call Caremark from a CVS store and transfer manually.

The attempt to steer business to their own pharmacies has been a PBM staple for many years and all PBM's, Caremark, Medco, WHI and Express Scripts all do this kind of thing.

There have been exclusive contracts for years and this is really nothing new. Any pharmacist who has been around for a decent number of years knows this is old hat....

Yes, PBM's have been doing this for years. The problem is the largest PBM and the largest pharmacy have never been one compnay. It is absolutly illegal what CVS/Caremark is doing. It is a violation of antitrust laws and creates unfair competition. CVS is using Caremark to gain an unfair advantage.

 

[Old Timer]

Yes, PBM's have been doing this for years. The problem is the largest PBM and the largest pharmacy have never been one compnay. It is absolutly illegal what CVS/Caremark is doing. It is a violation of antitrust laws and creates unfair competition. CVS is using Caremark to gain an unfair advantage.

We will see what the feds say......

 

[Ilikechemicals]

Apparently a customer can not call one time and opt out of mail order in general. They have to call to opt out for each individiual medication.

 

[Doctor M]

We will see what the feds say......

Sometimes I wonder if you are Tom Ryan in Disguise...I just dont get it...

 

[Doctor M]

Apparently a customer can not call one time and opt out of mail order in general. They have to call to opt out for each individiual medication.

So can a customer call in and opt out of this CVS/Caremark BS or not?? What will their copays be???

 

[MountainPharmD]

So can a customer call in and opt out of this CVS/Caremark BS or not?? What will their copays be???

My understanding is they were pressured to use Caremark mailorder. If that didn't work they pitched getting a mail order supply filled at CVS for the same price. This option is only at CVS and is not allowed at competing retail pharmacies.

 

[Old Timer]

Sometimes I wonder if you are Tom Ryan in Disguise...I just dont get it...

Just because I don't like something and I don't like this, does not make it illegal. I think there should be any willing provider laws, but alas I am not a US Congressman or Senator nor am I in the State Legislature or Senate. Sorry. It's not illegal for a company to sign a contract with Caremark. It's not restraint of trade, because in our fu**ed up system, the consumer is not the customer the employer (in all of these cases) is the customer and they are free to use any PBM they want.

My understanding is they were pressured to use Caremark mailorder. If that didn't work they pitched getting a mail order supply filled at CVS for the same price. This option is only at CVS and is not allowed at competing retail pharmacies.

If your employer signs a contract with Caremark they set the terms, optional mail order, mandatory mail order, mandatory mail order for maintenance medications, mandatory mail order for maintenance medications after x number of fills at retail. Once CVS purchased Caremark they offered employers Maintenance Choice (at an extra fee) where they can get the price of mail order with the convenience of retail while everything is under the Caremark umbrella.

Look, our system is crazy. There should be no employer insurance and all of this would go away. As long as the consumer of services and payer are different you will have this and other problems that are manifest with our health care system.

You can whine about CVS all you want. They are a business and they take advantage of every opportunity they can to make money for their share holders. That's what business do or they go out of business. If you don't like the rules, organize and change them, but stop whining about somebody who takes advantage of the rules as they are.

 

[confettiflyer]

Honest question here: what makes this different from the Kaiser HMO model where it's an absolute requirement to a) see a physician/provider within network and b) must fill an rx at an in-house Kaiser o/o pharmacy?

It appears that passed legal muster, then again, I would imagine the size of the orgs come into play.

 

[Old Timer]

Honest question here: what makes this different from the Kaiser HMO model where it's an absolute requirement to a) see a physician/provider within network and b) must fill an rx at an in-house Kaiser o/o pharmacy?

It appears that passed legal muster, then again, I would imagine the size of the orgs come into play.

It's not illegal because the consumer is the employer and whether they make a deal with Kaiser, Humana, Caremark or the Boggey Wooggy Bugle man of Company B, they have a choice what kind of health insurance they want to provide their employees. The employees don't buy the insurance and that's why their say is limited. That's not restraint of trade, it's capitalism.

 

[Doctor M]

It's not illegal because the consumer is the employer and whether they make a deal with Kaiser, Humana, Caremark or the Boggey Wooggy Bugle man of Company B, they have a choice what kind of health insurance they want to provide their employees. The employees don't buy the insurance and that's why their say is limited. That's not restraint of trade, it's capitalism.

Ok, so what your saying is this: If I as an owner (yes my independent pharmacy) would like to purchase Health insurance including prescription drug coverage for my employees and for myself,and I chose Caremark, that means I would have to fill my rx's as CVS? So as an employer I am the customer and my employess have no say...correct? hmmm...I still dont get it...

 

[Old Timer]

Ok, so what your saying is this: If I as an owner (yes my independent pharmacy) would like to purchase Health insurance including prescription drug coverage for my employees and for myself,and I chose Caremark, that means I would have to fill my rx's as CVS? So as an employer I am the customer and my employess have no say...correct? hmmm...I still dont get it...

No, it depends on the plan you select. There are many Caremark plans that allow you to go to any pharmacy. The Employer decides. And the rest of your statement is true.

For my personal insurance, I can't go to Qwest for my blood work even though it's around the corner from my house, out of Network. My brother has to go a specific hospital, unless it's an emergency. Every plan builds their network and many plans have a limited network. Again, I don't say I support this, I'm just saying it's not illegal. Remember the golden rule. He who has the gold rules and the employer has the gold in this situation....

 

[MountainPharmD]

No, it depends on the plan you select. There are many Caremark plans that allow you to go to any pharmacy. The Employer decides. And the rest of your statement is true.

For my personal insurance, I can't go to Qwest for my blood work even though it's around the corner from my house, out of Network. My brother has to go a specific hospital, unless it's an emergency. Every plan builds their network and many plans have a limited network. Again, I don't say I support this, I'm just saying it's not illegal. Remember the golden rule. He who has the gold rules and the employer has the gold in this situation....

This is not the issue. We all understand employers can pick whatever plan set up they choose. The issue is CVS illegally exploiting its relationship with Caremark by mining their data and using it to coerce people to use CVS. This is done outside any contracts and is done solely to steer customers to CVS using Caremark’s data. This is why they are being investigated by the FTC and are being sued by the attorney general’s of 5 states. There is also a bill in congress that would prohibit the Federal Employee Health Benefits Program from doing business with a retailer owned PBM. What CVS/Caremark is doing is illegal and a huge conflict of interest. The merger never should have been allowed.

 

[Dezixn]

This depends on the plan the sponsor signs up for. CVS get's certain data from Caremark like generic utilization for a given store or zip code, but there is a firewall between the Divisions so the store level cannot see what is done at the mail order level and they can't see what goes on at retail. Unlike chain to chain transfers in the system, we need to call Caremark from a CVS store and transfer manually.

The attempt to steer business to their own pharmacies has been a PBM staple for many years and all PBM's, Caremark, Medco, WHI and Express Scripts all do this kind of thing.

There have been exclusive contracts for years and this is really nothing new. Any pharmacist who has been around for a decent number of years knows this is old hat....

Exactly... It's not like Caremark is the only one doing this. I have no idea if this is actually illegal or not...

And refer to the insurance as Caremark people, that's the insurance side, CVS is the store side. People always get that confused lol.

 

[Doctor M]

This is not the issue. We all understand employers can pick whatever plan set up they choose. The issue is CVS illegally exploiting its relationship with Caremark by mining their data and using it to coerce people to use CVS. This is done outside any contracts and is done solely to steer customers to CVS using Caremark’s data. This is why they are being investigated by the FTC and are being sued by the attorney general’s of 5 states. There is also a bill in congress that would prohibit the Federal Employee Health Benefits Program from doing business with a retailer owned PBM. What CVS/Caremark is doing is illegal and a huge conflict of interest. The merger never should have been allowed.

Like insider information...

 

[Doctor M]

No, it depends on the plan you select. There are many Caremark plans that allow you to go to any pharmacy. The Employer decides. And the rest of your statement is true.

For my personal insurance, I can't go to Qwest for my blood work even though it's around the corner from my house, out of Network. My brother has to go a specific hospital, unless it's an emergency. Every plan builds their network and many plans have a limited network. Again, I don't say I support this, I'm just saying it's not illegal. Remember the golden rule. He who has the gold rules and the employer has the gold in this situation....

Does Caremark disclose all this in the fine print? cause most people dont read the contracts...It probably is in the fine print in size 2 font somewhere in the middle of the 200 page contract...

 

[Old Timer]

Does Caremark disclose all this in the fine print? cause most people dont read the contracts...It probably is in the fine print in size 2 font somewhere in the middle of the 200 page contract...

When Caremark or Express Scripts or Medco negotiates with an Employer, everybody knows what everybody is getting. Remember the employer sets the terms. You think Caremark tricked ATT&T or whatever company they deal with into accepting something without their knowledge?

The employers is presented with a range of options and they pick the one they feel best meets whatever criteria they set. Some are more concerned with cost and there some that are less concerned with cost.

 

[PharMed2016]

When Caremark or Express Scripts or Medco negotiates with an Employer, everybody knows what everybody is getting. Remember the employer sets the terms. You think Caremark tricked ATT&T or whatever company they deal with into accepting something without their knowledge?

The employers is presented with a range of options and they pick the one they feel best meets whatever criteria they set. Some are more concerned with cost and there some that are less concerned with cost.

I think its simplier to do away with insurance once and for all. Every person/family for himself/herself!

Alas, I don't think this would fly with alot of people. =[

 

[MountainPharmD]

And refer to the insurance as Caremark people, that's the insurance side, CVS is the store side. People always get that confused lol.

Yes, people are confused and that is the point of the lawsuits. There is no store side and retail said. They are essentially acting as one.

 

[MountainPharmD]

When Caremark or Express Scripts or Medco negotiates with an Employer, everybody knows what everybody is getting. Remember the employer sets the terms. You think Caremark tricked ATT&T or whatever company they deal with into accepting something without their knowledge?

The employers is presented with a range of options and they pick the one they feel best meets whatever criteria they set. Some are more concerned with cost and there some that are less concerned with cost.

Again, I am not talking about the initial contract that was signed between Caremark and the individual employers. You or I have no idea what is in those contracts. Its one thing if the contract says the insured employees have to use a CVS pharmacy or Caremark mail order. That is not what I am talking about. I am talking about CVS mining Caremark’s database and using that information to steer people insured by Caremark to CVS. The people who are insured by Caremark who are free to choose any pharmacy they want. These are the rejections we have been getting from Caremark when we try to process a claim. Not a "you have to use CVS or mail order rejection" rather a rejection requesting the patient call Caremark so they can try and convince them to use mail order or go to a CVS. This is illegal. It is a violation of antitrust laws and has created an unfair competitive advantage for CVS. It is for this reason they are being sued and investigated by the FTC.

Yes Dr M. it is exactly comparable to insider trading.

 

[Dezixn]

Yes, people are confused and that is the point of the lawsuits. There is no store side and retail said. They are essentially acting as one.

I guess you don't work at CVS lol.
"Do you have your CVS card?"
"Sir, that's your Caremark insurance card, not your CVS card."
Gooooooood times.

Again, I am not talking about the initial contract that was signed between Caremark and the individual employers. You or I have no idea what is in those contracts. Its one thing if the contract says the insured employees have to use a CVS pharmacy or Caremark mail order. That is not what I am talking about. I am talking about CVS mining Caremark’s database and using that information to steer people insured by Caremark to CVS. The people who are insured by Caremark who are free to choose any pharmacy they want. These are the rejections we have been getting from Caremark when we try to process a claim. Not a "you have to use CVS or mail order rejection" rather a rejection requesting the patient call Caremark so they can try and convince them to use mail order or go to a CVS. This is illegal. It is a violation of antitrust laws and has created an unfair competitive advantage for CVS. It is for this reason they are being sued and investigated by the FTC.

Yes Dr M. it is exactly comparable to insider trading.

So the issue is CVS and Caremark are using each others information? CVS bought Caremark, so would it not be legal to use that data, seeing as how they are the same company? Other insurance companies try to force people to use a designated mail order service or such and such pharmacy too IIRC. This isn't a 1:1 example, but grocery stores such as walmart promote you to use their gas stations because you get it cheaper with your card or w/e. It doesn't sound like this would be illegal, CVS and caremark are big but certainly don't have a monopoly by any means.

 

[Doctor M]

I guess you don't work at CVS lol.
"Do you have your CVS card?"
"Sir, that's your Caremark insurance card, not your CVS card."
Gooooooood times.



So the issue is CVS and Caremark are using each others information? CVS bought Caremark, so would it not be legal to use that data, seeing as how they are the same company? Other insurance companies try to force people to use a designated mail order service or such and such pharmacy too IIRC. This isn't a 1:1 example, but grocery stores such as walmart promote you to use their gas stations because you get it cheaper with your card or w/e. It doesn't sound like this would be illegal, CVS and caremark are big but certainly don't have a monopoly by any means.

Ok, promote and forcing someone are two different things...I dont have to fill gas at walmart, I have a choice...I have many pts that will the extra copay to just keep using me...but now thay have to pay the full cost of the drug??Who is saving money here?? Caremark? The plan sponsor? How does that save money for the plan sponsor?Its all BS...

 

[Dezixn]

Ok, promote and forcing someone are two different things...I dont have to fill gas at walmart, I have a choice...I have many pts that will the extra copay to just keep using me...but now thay have to pay the full cost of the drug??Who is saving money here?? Caremark? The plan sponsor? How does that save money for the plan sponsor?Its all BS...

Yeah, don't get me wrong, I don't think it's morally right either. Some of our customers don't want to leave us when they are forced to do mail order. It just don't think it's illegal as far as I know, I mean caremark isn't the only one doing this sort of thing. But I'm just a pre-pharm about to start his P1 year, not a lawyer.

 

[PharMed2016]

Ok, promote and forcing someone are two different things...I dont have to fill gas at walmart, I have a choice...I have many pts that will the extra copay to just keep using me...but now thay have to pay the full cost of the drug??Who is saving money here?? Caremark? The plan sponsor? How does that save money for the plan sponsor?Its all BS...

You go to school for 6-8 years or more if you do residency... only to get saddle with crap like this. This is why I think pharmacy is going to hell... it's all about corporate profits and advantage over you competitors.