Caremark to pay $38.5M settlement

Caremark made a carefully-crafted business decision to increase its profits, and got caught. The article states that Caremark steered physicians to prescribe 'brand-name' drugs in which it had a financial interest. Brand name drugs cost more and are subject to a higher patient co-pay than generics, so to this extent what Caremark and the physicians did was unethical, to say the least. The patients - Caremark's and the doctors' - suffered financially. I would not be surprised to see some sort of class-action suit arise from this.
Another question, equally important in my view: according to the article, Caremark was pushing these drugs because it was getting big volume discounts from the manufacturer. In the 'nobody asked me, but' category (with apologies to Ed Koch, who used this line to begin straw man arguments all the time) - why can a private insurer like Caremark obtain 'big volume discounts' from pharma manufacturers, when Medicare, with the largest patient membership base in North America, is forced by law to pay full retail for the medications it pays for thru Part D? I have seen almost no one bring up this latter point, which is draining billions of dollars annually from the Medicare program directly into the pockets of Big Pharma.
Howard

Howard, thank you for your thoughtful note. As my editorial suggests, it does seem likely that companies like Caremark simply make a business decision that crossing legal/ethical lines will pay more than it costs. The question is, then, how do we make it too costly for pharmas and their distributors to play these games?

Meanwhile, on the Medicare question, it is worth bringing up. I personally have never learned how legislators justified this deal. Do any of you readers know what the rationale was for agreeing to such a contract? Heaven knows Medicaid won't pay full price for drugs, and I've never heard it suggested that it should.