LA Times: CVS Faces Continued Federal Scrutiny Over Medicare

Thursday, 07 Feb 2013 08:06 AM

By John Morgan

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Some older Americans enrolled in CVS Caremark’s Medicare program have found themselves with unexplained large bills that CVS has refused to negotiate, according to the Los Angeles Times.

Medicare sanctioned the drugstore chain in January, preventing the company from enrolling new members in its SilverScript program until the issues are resolved.

The government said CVS Silverscript’s inability to process prescriptions correctly “poses a serious threat to the health and safety of Medicare beneficiaries.”

Editor's Note:
An $87,500 Tax Loophole Discovered by Cherry Hill Accountant

CVS blamed the problems on “an enrollment system conversion” that “brought about an increase in call volume and issues related to claim processing.”

Jon Roberts, president of CVS’ pharmacy benefit management business, said the company is committed to working swiftly with Medicare to resolve the issues.

However, the Times reported the company is also being investigated by federal and state officials for allegedly refilling prescriptions and billing insurers without patients’ approval.

CVS blamed such incidents on overeager pharmacy managers and said the practice does not represent company policy, according to the Times.

But internal emails and documents obtained by the Times “suggest the unauthorized refills were more widespread than CVS would have customers believe,” the newspaper said.

Marketwatch reported existing employer group health plans and CVS Caremark health-plan clients are not affected by the sanctions, which took effect Jan. 15.

The company does not expect the sanctions to have a material impact on 2013 earnings, Marketwatch said.

Because of healthcare changes wrought by Obamacare, some physicians have limited Medicare and Medicaid members’ access to their services, according to a survey by The Physicians Foundation, stock research firm Trefis.com reported.

The ripple effect could limit the number of prescriptions filled and limit revenue growth for the retail pharmacy business of CVS and other drugstore chains, Trefis predicted.

Editor's Note: An $87,500 Tax Loophole Discovered by Cherry Hill Accountant

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