Whistleblower Files Lawsuit on CVS Health

After 19 years as a CVS Health executive who left three years ago, Alexandra Miller filed a lawsuit that brings to light CVS Health’s shady practices as a result of the brand’s vertical integration. Last year CVS Health acquired Aetna, and while this lawsuit isn't related to Aetna, it does show what happens when the pharmacy and the insurance provider are co-mingled in a complicated web.

As a part of the CVS Health system, the lawsuit shows pharmacies overcharging Medicare patients by intentionally removing affordable generic options. This was achieved by CVS owned SilverScripts plan orchestrated with a retail pharmacy. Because it targeted low-income Medicare patients, both the patients and taxpayers are overpaying for non-generic drugs, some of which would be cheaper out of pocket than with insurance. According to Stat News:

“CVS eventually fine-tuned its approach by targeting the many Part D beneficiaries who had low-income subsidies, since they may not readily notice issues with their co-payments. Why? The Medicare program subsidizes most of the Part D premium, deductibles and cost sharing.”

When Alexandra Miller brought attention to the fraudulent system to supervisors, she was turned away because CVS Health executives calculated that the risk of getting caught was insignificant to the profits of this plan. It was also implied that because the plan targets low-income patients and Medicare billing is murky at best, there was a better chance of no one noticing.

A JAMA study on the subject arrived at the common-sense conclusion that, in order for consumers to save money on a generic drug option, the consumer has to be aware of and have access to a cheaper generic in order to choose it. (I'm not sure if we needed a study to predict that.) Initially CVS Health skated around deceptive practices to hide generic drug options, and then worked up to removing generic options entirely over time