From ABC News:

Drugstore operator CVS Corp. announced Wednesday it is buying pharmacy benefits manager Caremark Rx Inc. for about $21.3 billion in stock.

The deal, which the companies described as a “merger of equals,” would create a drug benefit manager that can take on retail leader Wal-Mart’s growing presence in generic drug sales, analysts said.

On first blush (and it deserves more thought than this) I see this as a positive development for people and companies covered by or contracted with Caremark, because it merges the storefront delivery of medications with the back-end insured piece, which at the very least should streamline some of the issues with regard to cost and coverage.

It deserves more thought and analysis than I’ve got to give it right now. It seems like a good thing for consumers and certainly puts another pharmacy on competing terms with Wal-Mart, which should be good for pricing, too.

Of course, the pricing issues also rest with the manufacturers, too.

[disclosure: Caremark is my PBM; CVS is where I fill the majority of my prescriptions]

Technorati Tags: Caremark, CVS, PBM, merger, pharmacy, insurance benefits

A prediction: The emerging news about United Healthcare will not stop with them.

According to a report prepared by lawyers at WilmerHale, the board of directors and its compensation committee didn’t bother keeping good notes about their decisions regarding pay negotiations and stock options. And the documents authorizing those options conveniently left the date blank, so that someone — even today, it’s not exactly clear who — could later pick the date that just happened to make the options as valuable as possible.

Keep in mind, Caremark is also under investigation for stock options abuse, one day after United Healthcare was served.

The unveiling is just beginning, and meanwhile, we’re appealing stupid decisions about our health by doctors who are without a clue.

Technorati Tags: United Healthcare, stock options, corporate accountability, SEC violations

In a recent comment, J criticized me for being too negative about Caremark. So I’ve tried to find something to balance that negativity and did come up with this article this morning. Congratulations to the employees manning the phones. It’s not an easy job and I can say that I’ve honestly never had a problem with anyone I’ve spoken to on the phone, so for that Caremark deserves a thumbs-up.

On the other side of things, however, we have this piece of news about Caremark and other PBMs:

Pharmacy benefit managers, hired by employers to manage prescription drug purchasing, have long been criticized for not passing on to clients the rebates they receive from drug manufacturers.

After all, PBMs are in business because they save their clients money.

Recently, many PBMs have agreed to pass along rebates on brand-name drugs to customers. Yet such gains are too little too late, according to some health care benefits experts.

“I think those who have been caught up in the rebate game are very shortsighted,” says Keith Bruhnsen, assistant director of staff benefits at the University of Michigan. Bruhnsen led the university’s effort to do away with PBMs and manage its drug spending.

Whether you agree or disagree with J’s points about how I feel about Caremark, I think it’s fair to say that the entire system is broken and in need of repair.

It’s unfathomable to me that the premium rates for health insurance rose at twice the rate of inflation last year while the average benefits and coverage actually dropped. If the study had factored in the lowered limits and higher deductibles on health insurance benefits the rate of increase would likely have been five or six times the rate of inflation.

Finally, I’m wondering how PBMs and health insurers can possibly provide data to the FDA for studies of the safety of ADHD medications when they limit which medications patients can use and therefore have incomplete data.

In one week articles about the FDA’s follow up on approved medications, PBM rebates, and outrageous increases in the cost of health insurance. Profits for the third quarter for these companies will be announced soon. I somehow doubt that any of them will have dropped.

The system is broken. The question is how to fix it?

Technorati Tags: health insurance, healthcare

Via Digg — Evidently some do.

Unfortunately Caremark doesn’t seem to be one of them. Here are some recently published complaints about them at ConsumerAffairs.com. They’re also linked in this story (the full story which mentions Caremark is living in the Wall Street Journal’s walled garden, so I’ll link to the abbreviated one published in the Pittsburgh Post Gazette instead).

In a nutshell, employers are discovering that many third-party administrators are in the pockets of the insurance companies and are compensated generously for recommending a change to Caremark. Evidently Caremark figures that it’s more profitable to pay the middleman, even when there is a conflict of interest, than it is to honor their PBM obligations and cover prescribed medications.

An excerpt from the WSJ article:

… It is another example of how health-care middlemen can reap profits even as … Strategies says the firm received revenue of $629,012 from a PBM, Caremark Rx Inc

Other Caremark news of note:

• Litigation against Caremark for backdating stock options goes forward. (Follow the money on that one)
• A man is fired after his employer accessed his Caremark medication records and discovered a prescription for an anti-anxiety medication.
• Caremark set the California precedent for holding board members civilly liable for criminal acts, which could come back to bite HP’s Board in the butt with regard to their recent pretexting shenanigans.
• Caremark’s 2nd Quarter profits were above expectations, largely because of their insistence on denying coverage for prescribed medications to consumers who are NOT Medicare or low-income subscribers.

  
  

  Caremark (NYSE: CMX) was one of the most recent companies within this group to report. CMX generated second-quarter profits of 57 cents per share, two cents above expectations. Net revenues rose 15% primarily because of increases in mail and retail sales. Medicare Part D played a role in the growth, though the company noted that it saw “several major generic introductions” this year. (The cheaper cost of generic drugs makes them more affordable to consumers and more profitable for medical insurers and pharmacy benefit managers.) Citing both business momentum and the impact of share buybacks, CMX raised its guidance for full-year earnings per share to a range of $2.37 and $2.39 per share, from $2.29 and $2.35 per share. The majority of the 18 covering analysts raised their projections in response, causing the full-year estimate to rise by four cents to $2.38 per share.

As for me, I am about to fork over another $400 for Sticks’ meds for the last quarter of the year. I have exhausted my Tier II appeals and am about to go back for another round, but he still has to have the meds.

I think that means this blogger will keep barking.

Technorati Tags: caremark, PBM, sleazy insurance practices

Via San Diego Source:

Caremark Rx Inc. (NYSE: CMX) led off another flurry of earnings reports with a 20 percent jump in second quarter profits. The pharmaceutical service provider also increased its full-year forecasts. Caremark added $1.05 to $55.69.

Yippee, Caremark. I, on the other hand, have suffered a loss of $1,107 through the second quarter of 2006 because of their refusal to cover Sticks’ meds. That’s a LOSS to help their PROFITS.

I wonder how many other subscribers are losing money so they can make money. Speak up in the comments if you’re one.

Technorati Tags: caremark, profits, PBM

From RobSeth, this comment, from his letter to the CEO of Caremark:

I’m not asking for Viagra, Minoxodil, or heavy narcotics. I’m sorry it’s so expensive and that providing it to me cuts into your profit margin, but I did not ask to be afflicted with this condition. Are you going to live up to your obligations and help me? Or do I need to take more drastic measures like contacting my local media or setting a website up to get my story out the public? Like this one I found?:

http://www.caremarkrxsucks.com/

I don’t want to. But I don’t know what else to do at this point. I’m desperate. Please do the right thing.

Technorati Tags: Caremark, PBM, prescription coverage, medicare

Charlotte Observer: Pharmacies in Peril

(Regarding underpayment to pharmacists on Medicare Plan D covered medications)

Responding to complaints, Leslie Norwalk, deputy administrator of the Centers for Medicare and Medicaid Services, recently told a congressional committee that most Part D plans pay pharmacies “well within the industry standard of 30 days from the time a clean electronic claim is submitted.”

Norwalk said Medicare discovered some cases where drug plans “printed checks that were held several days before mailing,” but the plans “quickly remedied any problems.”

The agency surveyed insurance plans and found that 18 of the top 20 pay pharmacy claims twice a month, Norwalk said.

Emilio Ruocco, a spokesman for Caremark Rx Inc., a pharmacy benefit manager, said his company follows the “current prompt-pay rules and the normal 30-day time frame.”

He said the 30-day rule starts after the prescription “has been verified,” not when it’s issued. In January and February, he acknowledged there were delays in verifying Part D enrollments. But he said he had not heard of two-month delays.

From Phil Law Weblog, “Caremark Rx in Class Action Lawsuit”

A lawsuit seeking class action status has been filed in the United States District Court for the district of Arizona alleges that Caremark Rx Inc. intentionally concealed revenue to avoid paying commissions.

Caremark Stock Options Draw Subpoena

From PlanetFeedback.com - Caremark, Do you not get it? (Be sure to read the comments too)

Yahoo! News: Pharmacy Benefit Managers’ Drug Cost Savings is a Shell Game: Numerous Lawsuits Filed Against PBMs for Fraudulent Conduct

“Time and time again, PBMs’ business tactics financially enrich the PBMs and contrary to their slogans offer no real healthcare savings to patients or plan providers,” said Mike James, pharmacy owner and Director of Governmental Affairs, Association of Community Pharmacists Congressional Network (ACP*CN). “PBMs are not cost savers but are playing a shell game with their clients — hiding the money they make from driving up prescription drug costs at the expense of the patient and, in the case of Medicare the US taxpayers. The savings derived by the Medicare patients are the result of the taxpayers’ subsidy, not the PBMs,” added James.

Technorati Tags: Caremark, PBM, pharmacy, prescription benefits

From Stacey:

I have never been so disappointed in a company before. I have never used Caremark in the past, always getting my meds filled at a local pharmacy, but with the rising costs of prescriptions meds I decided to give it a try. I have been waiting for my meds for 3 weeks. I have made four phone calls and I too tried to contact the company through their email address and the same thing happened to me. Yesterday and again today I was told that they have no explanation as to why my order has sat for so long and not been filled. Both times they also said that it would be sent out overnight. I have a hard time believing them anymore. I would never reccommend the company to anyone and would like to get word out to more people about this. Any ideas? I too have a child and a husband with adhd I hope this never happens to us.

Hi Stacey,

I wish I had some idea why they’re taking so long. Isn’t it amazing that they want us to use their mail order programs but can’t seem to give us adequate service when we do? What if you were diabetic or had a chronic illness that required you to manage it with meds?

In a situation like that, there should be some way for them to authorize a pickup from your local pharmacy. You might even try to push for that if they don’t deliver that overnight delivery tomorrow.

The only way I know to really get the word about it out there is to blog away and comment on similar blogs, just like you’re doing. That’ll get the word out but doesn’t mean they’ll do anything differently, which is where I’m frustrated. I have so many questions for them, like “why is it that you approve my meds and not my son’s when we were diagnosed and treated by the same doctor?”

Here’s something else interesting — after I posted the post you commented on, MY Prior Authorization was lost. When I went to refill my prescription they suddenly needed a new one. After throwing a very large phone fit and faxing over the original they put through a new one posthaste with an extended authorization through June, 2007. But how could they possibly lose an authorization they had on file one month earlier? It made no sense.

Whatever dealings you have with them, be sure you keep written records of everything. Document every tiny thing that happens, because you never know when you’ll need to push farther and higher up the chain.

Here are some interesting links that I found while looking for ideas to help you:

• Caremark - Careers in Customer Service
• Loyalty Strained at Caremark

and this one..

The Caremark Mail Order Rx FAQ. There are two toll-free numbers on that FAQ that your doctor can call. You might (as a long shot) see if the doctor will call them and try to get the ball rolling on that.

Finally, I’d also suggest contacting the Customer Service department of the health plan that contracted Caremark as their PBM and lodging a complaint. Your state insurance commissioner is another avenue.

I hope you’ll come back and post an update of what happens!

DnW

Technorati Tags: caremark, mail-order prescription, health insurance