CVS Health has been accused of overcharging for generic medications in a new lawsuit brought forth by six Blue Cross Blue Shield plans.
The suit alleges CVS has intentionally overcharged the six plans for drugs by submitting claims with artificially inflated prices. The plans cover six states––Alabama, Florida, Minnesota, North Carolina, North Dakota and Missouri.
The lawsuit further alleges CVS created a discount program for generic drugs that attracted customers away from CVS’ competitors, but also hid the true prices from third parties, such as the insurers in the case.
“CVS intentionally told third party payors … that the prices charged to cash customers for these generic drugs were higher––often much higher,” the lawsuit reads. “Third-party payors then reimbursed CVS based on those higher, inflated prices––instead of the actual, lower prices CVS offered to the general public, including through its Cash Discount Programs.”
CVS, by law, was required to give the third parties the same prices.
“This is fraud,” according to the lawsuit. “And CVS was able to perpetrate and conceal this fraud for years.”
The lawsuit comes at a time when pharmacy benefit managers (PBMs) are already under fire for their role as middlemen in the pharmacy business, acting as an administrative and claims processing service to negotiate drug prices between payors and pharmacies.
CVS Health did not respond to media requests from Health Exec as of press time.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."