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Health companies sued over prescription drug prices

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Health insurance provider Anthem Inc., and prescription drug benefit and mail-order provider Express Scripts are facing lawsuits filed under the Employee Retirement Income Security Act. The lawsuits from plan participants come after the two businesses had already been engaged in legal battles between themselves.

According to reports, Anthem first sued Express Scripts earlier in 2016, alleging that the prescription drug company had been overcharging for items provided to Anthem plan participants. Anthem stated in the suit that the charges were outside of the contracted agreement that it had with Express Scripts. The lawsuit was reported as involving $15 billion in damages.

A few months later, two participants in Anthem's health plans brought their own lawsuits, and several months later additional lawsuits were filed by plan participants. The lawsuits are reportedly claiming that both Anthem and Express Scripts violated their duties under ERISA, which requires certain plans and coverage providers to act according to fiduciary requirements. Taking actions that caused individuals to overpay for medications would be outside of those requirements.

The lawsuits specifically allege that Anthem engaged in a contract with Express Scripts that was harmful to beneficiaries. The contract gave Express Scripts exclusive management of prescription drug benefits for over 15 million Anthem members. According to court documents, Express Scripts paid for that exclusivity in an amount nearing $5 billion. The lawsuit alleges that Express Scripts engaged in overpricing as a tactic to recoup those expenses.

The companies are denying the allegations, according to reports, and plan to defend themselves in court. This case is a good illustration of how complex insurance coverage can be. Multiple entities are often linked to a single plan, and it can be difficult to tell what benefits and expectations you, as a plan holder, have of each company. If you believe you are being overcharged for services or aren't being afforded the coverage included in your plan, then consider speaking with an insurance lawyer for more information.

Source: Bloomberg BNA, "Express Scripts, Anthem Face ERISA Lawsuit Over Drug Pricing," Carmen Castro-Pagan, June 28, 2016

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