Oklahoma's Attorney General Gentner Drummond has secured a hefty $32 million settlement with CVS Caremark, the pharmacy benefit manager accused of withholding money from the state's employee health plan, HealthChoice. According to a recent announcement, the state claimed that CVS Caremark failed to pass on drug manufacturer rebates and discounts between January 2020 and December 2024, funds that were intended to reduce healthcare costs for state employees.
"When a company keeps money that belongs to Oklahoma taxpayers, we're going to fight to get it back," Drummond said in a statement obtained by the Oklahoma Attorney General's office. The settlement mandates that CVS Caremark coughs up $32.1 million to the State of Oklahoma. After lawyers get their cut in line with state statute, roughly $27 million will be funneled directly into HealthChoice within 30 days – a boon for state employees, their families, and retirees.
Ellen Buettner, CEO of the Oklahoma Health Care Authority, which oversees HealthChoice, praised the settlement, confirming the good news for Oklahoma's state employees. "This settlement ensures millions of dollars will be directed back to the HealthChoice plan, benefiting Oklahoma's state employees and their families," Buettner told the Oklahoma Attorney General's office in a cheer of endorsement for the hard-fought win.
Additionally, as per the terms of the agreement, CVS Caremark has agreed to pay any extra rebate money collected for the contested period within 90 days. This settlement also tightens the contract language and broadens the definition of "rebate," adding layers of transparency and guaranteed future benefits to the HealthChoice plan. The pharmacy giant must, too, pass through all future rebate payments directly to HealthChoice within a three-month window post-collection.
Digging into the details, Drummond lauded his team for its diligence in bringing this matter to a close. "This significant recovery would not have been possible without the exceptional work of our Consumer Protection Unit and PBM Compliance and Enforcement Unit," Drummond acknowledged, tipping his hat to Deputy Attorney General Michael Leake for his leadership in the PBM Compliance and Enforcement Unit, as he mentioned in the official statement.
While CVS Caremark has denied any wrongdoing in the matter, they've agreed to the settlement to skirt the risks and costs that come with litigation. The Attorney General's office continues to pursue a separate lawsuit against the company, alleging that it underpaid Oklahoma pharmacies.
