State of Maryland`s CVS Caremark Contract Audit Reveals More than $10 Million in Potential Overpayments, Undisclosed Rebates, Improper Drug Switching, According to CtW

ANNAPOLIS, Md.--(Business Wire)--
CVS Caremark, the State of Maryland`s former pharmacy benefit manager (PBM),
collected more than $10 million in potential overpayments and undisclosed
rebates, among other deficiencies, according to the State Department of
Legislative Services which recently audited the Department of Budget and
Management Office of Personnel Services and Benefits (OPSB) for the years 2004 -
2007. Catalyst replaced CVS Caremark in 2007 as Maryland's PBM.

"This audit should spur other public and private entities to take a hard look at
whether they, too, deserve refunds from CVS Caremark," said Jasmin Weaver,
Healthcare Initiatives Legislative Director at Change to Win as she testified
before the State of Maryland House Appropriations Committee today.

More Maryland Public Contracts, Other States Could be at Risk

Large CVS Caremark clients in the State of Maryland include the Prince George's
and Montgomery County Public Schools, Anne Arundel County, the Lockheed Martin
employees' plan, and Johns Hopkins Employer Health Programs, among others.

Government plans in Alaska, Arizona, California, Colorado, Connecticut, Florida,
Georgia, Illinois, Kansas, Maryland, Michigan, Missouri, Montana, North
Carolina, Nebraska, New Hampshire, New Jersey, New York, Ohio, Oregon,
Pennsylvania, Rhode Island, Tennessee, Texas, Utah, Virginia, Washington, and
West Virginia are currently contracting with CVS Caremark.

CVS Caremark Has Repeatedly Been Accused of Cheating Plans

Numerous CVS Caremark clients have accused the Company of withholding money that
the plans themselves were entitled to or engaging in deceptive or fraudulent
practices that ended up costing clients more.

In 2006, the United States Office of Personnel Management identified over $13
million in overcharges by Caremark`s predecessor, AdvancePCS, for the years 2000
through 2005 to the Federal Employees Health Benefits Program (FEHBP). The
agency determined the PBM kept $13 million in administrative fees that should
have been considered drug rebates and returned to the federal agency.

In addition to these findings, CVS Caremark was also the subject of several
large government false claims suits, which have settled for tens or hundreds of
millions of dollars. Other suits brought by private plans also allege
significant fraud or overcharges. CVS Caremark has settled some of these suits,
but several are still pending.

CVS Caremark`s Troubled Track Record on Drug Switching

CVS Caremark has been accused by numerous sources of improperly switching
patients to drugs different from the one their doctor prescribed in ways that
cost patients and their health plans more money, of switching patients to less
effective drugs without adequate regard for patient health, and of switching
patients` drugs without their doctors` approval.

CVS Caremark May Be a Bad Deal for Health Plans and Employers

Some reports have shown thatCVS Caremark earns significantly more profits from
its clients on each prescription it fills than do its biggest competitors, and
some employers and health plans have saved millions of dollars by dropping CVS
Caremark. After switching from CVS Caremark to another PBM in 2006, the State of
Illinois estimated that it would save $120 million over five years.

For more information, visit: www.AlarmedAboutCVSCaremark.org.

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 second largest pharmacy benefits manager (PBM) and largest
retail pharmacy chain. Change to Win represents workers in CVS Caremark plans
that cover more than 10 million people. On behalf of these health plan members,
our initiative seeks legislative reform of the PBM industry to protect plan
members` health and privacy.

Change to Win
Alex Goldschmidt, 202-721-6091
or
Gina Bowers, 202-288-0257

Copyright Business Wire 2009