Did CVS cut pharmacy reimbursements to help finance Aetna merger?

In the fourth quarter of 2017, CVS Health's pharmacy benefit manager, CVS Caremark, sharply reduced payments to pharmacies, and many critics are questioning the timing of the cuts, according to the Akron Beacon Journal.

A review of data collected from 40 pharmacies by the publication backs up what lawmakers, pharmacists and other critics have been saying for months: CVS Caremark reduced payments to pharmacies within a few months of the CVS Health announcement of its intent to acquire Aetna.  

The data from the 40 pharmacies reveals that CVS Caremark received $370,000 in taxpayer dollars in the first quarter of 2017, and in the fourth quarter of the same year CVS received $522,000.

The timing of the reimbursement reductions is prompting some pharmacists to question whether CVS Caremark reduced payments to help raise the $69 billon to merge with Aetna.

"Dramatically, within days [of the merger announcement], reimbursements for many mental health generics dropped through the floor, below anyone's ability to buy the product and provide it to the patient," New York Assemblyman John McDonald III said in a legislative hearing in June, according to the Dispatch.

Complaints also came to the Ohio Department of Insurance, which provides some oversight of the actions of pharmacy benefit managers — companies that negotiate prices with drug companies, help decide which medications are covered by health insurance plans and set reimbursement rates to pharmacies. But Insurance Department officials say they are enforcing the law as written, and the statute doesn’t allow them to address pharmacy benefit manager reimbursements, the Beacon Journal reported.

CVS officials disputed claims that the reimbursement reductions were related to the merger..

More articles on payers:
CEO of Sentara-owned insurer to hospitals: 'Don't think you can duplicate' Kaiser's health plan
BCBS lets Mayo in on decision-making with new 5-year contract
Anthem completes acquisition of palliative care provider Aspire Health: 3 things to know

© Copyright ASC COMMUNICATIONS 2020. Interested in LINKING to or REPRINTING this content? View our policies by clicking here.

 

Featured Webinars

Featured Whitepapers