CVS Caremark To Pay $5M For Defrauding Seniors

CVS Caremark To Pay $5M For Defrauding Seniors


By Ed Silverman // January 12th, 2012 // 11:21 am

CVS Caremark, which simultaneously operates one of the largest US pharmacy benefit managers and retail pharmacy chains, will pay a $5 million fine to settle charges brought by the US Federal Trade Commission over charges that prices of various Medicare Part D drugs - including those for treating breast cancer and epilepsy - were misrepresented at CVS and Walgreen pharmacies.

The scheme allegedly caused many seniors and disabled consumers to pay up to 10 times the correct prices for their drugs and pushed them into the so-called donut hole, which refers to the coverage gap where drug costs are not reimbursed, sooner than anticipated. The settlement requires CVS Caremark to pay $5 million to reimburse consumers for the price discrepancies.

CVS Caremark offers Medicare Part D drug plans through such subsidiaries as RxAmerica, which CVS Caremark acquired in 2008. Consumers can choose plans by examining benefits and prices on the RxAmerica website, for instance. The FTC charged that in 2007 and 2008, RxAmerica posted incorrect Medicare Part D prices for the retailers on its website and also supplied incorrect info to other sites.

[UPDATE: "The settlement should...serve as a warning to any Medicare drug plan sponsors that have potentially misled seniors in their promotion of so-called ‘preferred pharmacy’ plans," Doug Hoey, ceo of the National Community Pharmacists Association, says in a statement. "At the same time, it is regrettable that the FTC’s actions fell short of more robust protections for consumers and pharmacy competition, which are warranted in our view. NCPA provided to the agency what we believe to be compelling evidence, including one-sided contract terms with pharmacy small business owners, patient privacy concerns and a lack of transparency."]

Here is the agreement including the consent order; the analysis of the consent order; the complaint filed by the FTC; the FTC letter closing the investigation, and an FTC statement.

Please read complete article at link below:


http://www.pharmalot.com/2012/01/cvs-caremark-to-pay-5m-for-defrauding-seniors/

Editor's note: This Shark believes that $5 M is chicken feed to CVS Caremark and will be written off as a cost of business operation. The U.S. Attorney should get on his stick put some of these "pharmacy bandits" behind bars.  Lucius Verenus, Schoolmaster, ProbateSharks.com