Minnesota is asking for a $ 1.25 million fine against CVS Caremark for pharmacy rules

Minnesota is asking for a $ 1.25 million fine against CVS Caremark for pharmacy rules

Minnesota is threatening a $ 1.25 million fine against CVS Caremark, claiming it wrongly referred patients to CVS pharmacies owned by its parent company.

Caremark is a Rhode Island-based pharmacy benefits manager that structures how and where health plan members can use their coverage to get their medications.

The Minnesota Department of Commerce allegations focus on one of Caremark’s programs, called Maintenance Choice, which last year handled the choice of pharmacies for an estimated 72,000 state residents using maintenance drugs.

Maintenance medications are those used to treat ongoing health problems, such as high cholesterol, asthma, diabetes, and heart disease.

After filling the first three maintenance prescriptions, patients were required to use a CVS retail or mail order pharmacy where the Pharmaceutical Benefits Manager (PBM) has a proprietary interest, the Commerce Department said Thursday in a statement. Press release.

In some cases, patients “had to drive 20 to 130 miles,” the department said, to get to a CVS office rather than supplying medicines to a much closer pharmacy.

“A PBM cannot request or incentivize a covered member to use a pharmacy it owns unless certain other conditions are met, such as providing the same incentives to non-owned pharmacies,” the press release reads, “or impose the same incentives. same limits on its pharmacies as in its non-owned pharmacies. “

Phil Blando, a spokesperson for CVS Health, said on Friday that the company is committed to complying with all laws and regulations applicable to its business, as well as customer health care plans.

“While we argue that federal laws governing ERISA plans prevent state laws and that draft plans chosen from our Minnesota client plans are legal, we are working in partnership with the Minnesota Department of Commerce on this matter,” he said. Blando stated in a note.

The Department of Commerce has filed a lawsuit against the company and is trying to stop practices that the department claims are a violation of the Minnesota Pharmacy Benefit Manager Licensure and Regulation Act. A pre-hearing conference is scheduled for May 31.

The civil fine is the largest the Commerce Department has sought so far under the state regulations for PBMs passed by the legislature in 2019.

Pharmaceutical Benefits Managers structure the pharmacy portion of the health plan benefits. They create pharmacy networks where patients can get the best deals on medicines while negotiating prices with manufacturers. They also create “forms” that specify patient costs for different drugs.

Owned by CVS Health, Caremark is one of the nation’s three largest PBMs along with Optum Rx and UnitedHealth Group’s Express Scripts, which is owned by Cigna. Independent pharmacies said the PBM rules make it difficult for them to stay in business.

“This case demonstrates the importance of regulating PBMs in order to protect Minnesotan’s access to critical health care provided by pharmacies,” Commerce Commissioner Grace Arnold said in a statement. “The practices uncovered in this case show a company that prioritizes its profits rather than serving people.”

This story has been updated to include a CVS statement submitted on Friday morning.

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