Louisiana’s attorney general has filed a lawsuit against a pharmacy services firm and United Healthcare of Louisiana, accusing the companies of exploiting supply-chain complexities that led to billions of dollars in inflated prescription drug prices.
The lawsuit filed against OptumRX Inc. and United Healthcare in East Baton Rouge Parish alleges that a complicated system of rebates and reimbursements has caused health care insurers, including the Louisiana Medicaid program, to pay billions of dollars more annually for pharmaceutical benefits.
“(The) defendants not only know that their business models generate overpayments, they count on the complexity of the system to get away with it,” the April 13 lawsuit states. “For example, multiple layers of contracts mask the fact that when the PBM (pharmacy benefit management) acts as a middleman, it is really creating ‘spread’ – charging more for a given drug than the amount it reimburses a pharmacy – so that it can pocket the difference.”
The state is seeking damages it incurred as a result of the defendants’ actions, as well as civil fines and an injunction to stop the health care companies and their agents from manipulating payments and reimbursements for pharmaceuticals in the future.
“Unregulated middlemen, cloaked in secrecy, drive up their own profits at the expense of Louisiana citizens,” Landry said in a prepared statement. “Most Louisianans would be shocked to know how much cheaper they could obtain their prescriptions without these secretive schemes.”
But a spokesman for Optum, Drew Krejci, told the Louisiana Record in an email that the lawsuit was without merit and that Optum would defend itself against what it called unsupported allegations.
“We are honored to provide pharmacy benefit services to the Louisiana Department of Health’s Medicaid program that deliver access to more affordable prescription medications for consumers and Louisiana taxpayers,” Krejci said. “Our services are performed in accordance with state regulations and the department’s requirements outlined in our contract. …”
Optum was a PBM subcontractor for United Healthcare of Louisiana that handled prescription drug coverage for those enrolled in the Louisiana Medicaid program, according to the lawsuit. The complaint also alleges violations of the state’s Unfair Trade Practices Act and the Louisiana Medical Assistance programs Integrity Law.