Tennessee did a really smart thing not too long ago and decided to separate out the management of its prescription drug benefits for state employees. Smart, fiscally responsible move in these tough economic times. It could save the state millions!
So it’s curious that the Tennessee Benefits Administration awarded the management contract to CVS/Caremark, a company with zero transparency in its process, a suspect relationship between it’s benefits management division and the drug stores they own (“Don’t worry about knowing the details – we’ll get you the best prices on prescription drugs and then sell them to you too! Trust us!”), and an ongoing investigation by the Federal Trade Commission.
Other CVS/Caremark clients have been running for the hills. Why aren’t we?
Laurie Lee, executive director of benefits administration for the state, did address some of the concerns:
In the course of the procurement, we received correspondence from an outside organization making allegations about CVS/Caremark’s litigation history with various states as well as a pending Federal Trade Commission investigation involving the company. In light of the serious nature of the questions, we referred the issues to [Finance and Administration’s] legal counsel who sought advice from the Attorney General’s office.
As a result of the Attorney General’s office’s advice, we continue to recommend award of the contract to CVS/Caremark as the best evaluated proposer. If the contract is awarded to CVS/Caremark, we will work with the Attorney General’s office to include additional strong language in the contract addressing the steps we will take, up to and including termination fo the contract, if there is a finding of misconduct in any legal proceeding, including the FTC investigation. Please also note that, as indicated above, our proposed contract does address the transparency issues that were part of the allegations that the outside organization raised against CVS/Caremark.
So much good can be wiped away with one bad decision. Glad they are keeping a close eye on the situation.
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