Express Scripts Inc. has reached a settlement with 28 states that alleged the pharmacy benefits manager (PBM) misled consumers when it encouraged doctors to switch patients’ cholesterol drug brands under the guise of controlling costs. The agreement resolves a four-year investigation of St. Louis-based Express Scripts. This isn’t the first time a PBM has been caught cheating the government. It follows a similar $38.5 million multistate settlement in February with a rival PBM, and a 2004 drug-switching settlement with Medco Health Solutions Inc. As a result of these settlements, state attorneys general believe they “have changed how these companies treat patients and doctors when they ask to change their prescription medications.” As a part of the settlement with Express Scripts, the company must disclose full information and the reason for the proposed switch. In fact, that appears to be the most significant part of the settlement. These disclosures must be “clear and conspicuous.”
Express Scripts will pay $9.3 million of the total settlement to the states and the District of Columbia. Another $200,000 will be paid which will provide no more than $25 per claimant to individual patients to reimburse them for visits to doctors and tests linked to switches between rival brands of cholesterol-controlling drugs known as statins. The participants in the settlement are: Alabama, Arizona, Arkansas, California, Connecticut, Delaware, Florida, Illinois, Iowa, Louisiana, Massachusetts, Maryland, Michigan, Mississippi, Missouri, Montana, Nevada, New Mexico, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Vermont, Virginia, Washington and the District of Columbia. The same states were involved the settlement mentioned above with Caremark’s parent company, CVS Caremark Corp. Express Scripts fraudulently told doctors in some cases that patients and their health plans would save money by switching to a different drug brand to treat the same condition. Express Scripts failed to disclose to its client plans that money earned by Express Scripts accrued from the drug switching process would be retained by the company. Instead, it wasn’t passed on to the client plan.
While the amount to be paid under the settlement was small, it’s believed by the Attorneys General that the changes brought about in how Express Scripts will operate in the future are significant. This is just another example of corporate fraud by companies dealing with government programs. There is a belief in a good number of corporate boardrooms that cheating the federal and state governments is acceptable. That sort of thing can’t be tolerated since it costs the taxpayers a great deal of money. In fact, I would like to hear somebody explain why it’s OK to cheat the government!
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