It happened in Ohio, Arkansas, Iowa, New Jersey, New York and possibly other states. Pharmacy middleman CVS Caremark suddenly cut the reimbursements it paid community pharmacies for drugs, some of them far below pharmacists’ costs for potentially lifesaving medications.
Each of the cuts happened late last year or early this year — all within a few months of when CVS Health announced it was acquiring health insurer Aetna.
In a Dispatch review of data collected from 40 pharmacies, the numbers back up what lawmakers and critics said happened in the fourth quarter of 2017: CVS Caremark sharply reduced payments to pharmacies.
In the first quarter of 2017, CVS Caremark received $370,000 in taxpayer dollars from those transactions. In the fourth quarter of the same year, CVS Caremark’s portion was $522,000, according to the data. The data represent less than 1 percent of the $3 billion Medicaid paid for prescriptions in 2017. CVS Caremark handles the prescriptions for four of the state’s five managed-care plans.
CVS Health, the parent company of both CVS Caremark and CVS Pharmacy, reported net revenue of $34.2 billion in the fourth quarter of 2017, according to its website. That is a $3 billion increase from the fourth quarter of 2016.
Some pharmacists question the timing of the reimbursement reductions and say they think it was no coincidence. They question whether CVS Caremark used that spending reduction to help raise money for acquiring Aetna for $70 billion in cash and stock to create a health conglomerate that would include CVS Caremark, the nation’s No. 2 pharmacy benefit manager; Aetna, the No. 3 health insurer; and CVS Pharmacy, the nation’s largest retail pharmacy chain.
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BY MARTY SCHLADEN AND LUCAS SULLIVAN | THE COLUMBUS DISPATCH