CVS Caremark dumped by big Medicaid insurer
CareSource, by far Ohio's largest Medicaid managed-care provider, on Tuesday announced that it was firing CVS Caremark as its pharmacy benefit manager. The more than 1 million Medicaid clients served by Dayton-based CareSource now will have their prescriptions handled by Express Scripts, another of the nation's three dominant pharmacy benefit managers.
The move comes after more than a year of scrutiny by government officials and The Dispatch of CVS's pricing practices. A study found that in 2017, CVS charged taxpayer-funded companies such as Caresource almost $200 million more for prescription drugs than it reimbursed pharmacists.
“We believe the current PBM model has significant room for improvement,” CareSource President & CEO Erhardt Preitauer said in a statement . “CareSource saw an opportunity to reinvent the model with a focus on transparency, driving real value for stakeholders, building stronger partnerships with local pharmacies and controlling costs.”
Preitauer said that his company will adopt a new model, called "CareSource RxInnovations," that will provide more transparent pricing that will be verified by an independent third party. He also promised that independent pharmacists, who have suffered declining reimbursements, will be protected from market volatility.
“This is the culmination of a year-long effort to address the major areas of opportunity in the current PBM model,” CareSource Senior Vice President Clayton Edwards said. “We want to create something that better serves members through the integration of all clinical data—medical, behavioral, social and pharmacy. This will allow us to provide holistic care coordination, while also meeting the needs of our other key stakeholders—the states in which we do business and our pharmacy partners.”