Class-action suit targets Anthem, Express Scripts pact

handshake in front of money

A class-action lawsuit filed against Anthem and Express Scripts accuses them of brokering an agreement that left beneficiaries paying inflated co-pays for prescription drugs, adding a new wrinkle to an ongoing dispute between the two companies.

Plaintiffs from three different employers that sponsored medical plans though Anthem and Express Scripts allege the coverage providers violated the Employee Retirement Income Security Act (ERISA), a federal law that requires health plans to act in the best interest of beneficiaries.

According to the compliant, when Anthem agreed to a $4.675 billion 10-year contract with Express Scripts in 2009, it opted for a deal in which the pharmacy benefits manager (PBM) would pay more money up front, but charge higher prices for drugs over the course of the agreement. Anthem used that initial payment to buy back stock, “which ultimately enriched Anthem’s stockholders and management,” rather than passing the money toward plan participants.

Digital Transformation

Unlock the Digital Front Door with an App

The Member Mobile App is the smarter and better way to engage members anytime and anywhere. Members can find the right doctors, receive alerts, track spending, use telehealth, and more — all within a guided, intuitive, and seamless experience. Built exclusively for payers, it is ready to install and launch in a few months. Request a consult on how to enable the digital front door with the Mobile App, today.

The plaintiffs suggest Express Scripts also violated the federal statute by raising drug prices above competitive benchmark prices. The lawsuit cites a third-party analysis that found the PBM overcharged Anthem by as much as $3 billion each year, leading to an estimated $15 billion in overpayments over the course of the agreement. As a result, plan participants were left paying “significantly higher” percentage-based co-pays.

The details of the class-action suit mirrors Anthem's claim earlier this year that Express Scripts owed the insurer $3 billion in annual prescription drug savings. Months later, Anthem filed a lawsuit against the PBM seeking damages and the right to terminate a contract that runs through 2019. Express Scripts denied the allegations and responded with a counter-suit accusing Anthem of violating the terms of their contract.  

To learn more:
- here’s the complaint

Suggested Articles

Payers and PBMs need to be preparing now for the wave of CAR-T therapies coming through the drug development pipeline, according to a new report.

A CMMI review of value-based payment models gave high marks to models on home health and Maryland's total cost of care demonstration.

Walmart is piloting drone delivery of home sample collection kits for COVID-19 in partnership with Quest Diagnostics.