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Change to Win Coalition Launches National Reform Initiative Focusing On the Pharmacy Benefit Management Business of CVS Caremark

November 14, 2008

The Change to Win coalition of labor unions held a joint news conference today to discuss the troubling results of an eighteen month investigation into the history and practices of CVS Caremark, and outline an extensive education and reform initiative.

Chris Chafe, Executive Director of Change to Win said “We are launching this reform effort today because we have become concerned that CVS Caremark plans to exploit its access to an unprecedented amount of private patient information without meaningful consent or knowledge by plan participants. We aim to check the worst of these practices, making some of them more transparent and outlawing others through contractual and legislative change.” Change to Win affiliates represent workers in CVS Caremark prescription drug plans that provide benefits to more than 10 million people.

Legislative Reform

New York State Assembly Member Richard Gottfried discussed his own legislative initiatives to regulate pharmacy benefit managers. “Pharmacy benefit managers are one of the only players in health care that is not licensed or regulated. They operate in an arcane area, most of what they do is kept secret even from their clients, just a few companies dominate the field, and they handle billions of dollars. No wonder that state attorney generals around the country have found outrageous cases of PBMs bilking health plans, taxpayers and consumers out of hundreds of millions of dollars. It’s got to stop,” said Assembly Member Gottfried who is the sponsor of proposed legislation (A6341) to regulate pharmacy benefit managers.

Investigation into CVS Caremark’s Practices

New York City Councilman Eric Gioia (D-Queens), Chairman of the City Council Committee on Oversight and Investigations announced that he would begin an investigation into CVS Caremark’s practices of using patients’ prescription information and consumer data.

“New Yorkers expect and deserve to know that when they go to the pharmacy and fill their prescriptions, their information is safe and confidential,” said Councilman Gioia. “Pharmacy benefit managers should be protecting the personal information of customers, not giving it out to other companies. Filling out a prescription should not be an invitation to invasive marketing tactics and invasions of privacy. In this age of identity theft, New Yorkers must have their information protected vigorously.”

CVS Caremark: An Alarming Prescription

The coalition presented the findings of its study titled “CVS Caremark: An Alarming Prescription” detailing over a decade of questionable and allegedly illegal practices at Caremark, and new risks presented by the merged entity in such vital areas to health plans and consumers as patient privacy, patient health versus PBM profits, value to plans, conflicts of interest, and quality of service. CVS Caremark is currently operating under three separate consent decrees, with the U.S. Department of Justice and 28 states plus the District of Columbia, and is the subject of two pending lawsuits alleging improper drug switching and fraud.

The report is available online at www.AlarmedAboutCVSCaremark.org.

The $80 billion company was created through a merger in March of 2007 and today is the U.S.’s largest provider of prescription drug services.

Change to Win is a six million member partnership of seven unions founded in 2005 to represent workers in the industries and occupations of the 21st century economy. Change to Win is committed to restoring the American Dream for a new generation of workers – wages that can support a family, affordable health care, a secure retirement, and opportunity for the future.

Alarmed About CVS Caremark is a Change to Win initiative to educate health plan managers and trustees as well as consumers about the newly merged CVS Caremark, now the country’s largest provider of prescription drug services and largest retail pharmacy chain. Change to Win affiliates represent workers in CVS Caremark prescription drug plans that provide benefits to more than 10 million people. Our initiative also seeks legislative reform of the PBM industry to protect health plan members’ health and privacy.




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