MAGNOLIA, Texas -- From a shed behind his Magnolia home, Lonnie Butzske sews and donates quilts to area hospitals, bringing comfort and warmth to the sick.
But now he says he’s the one out in the cold.
“They’re controlling my life and killing me, because I can’t afford the medications the doctors have put me on to keep me alive,” Butzske said.
He’s talking about CVS, the drug store chain with thousands of locations across the United States. His wife, Peggy Butzske, said it all started with a simple letter telling them:
“(We) had to go to CVS, and that’s when all hell broke loose,” she said.
So, who was that letter from? The company that just had merged with CVS Caremark. It’s a massive firm that manages pharmacy benefits for thousands of companies, and in turn, millions of Americans. But the 11 News Defenders discovered this new mega company faces mounting complaints about unfair competition, overcharging taxpayers, and putting the elderly at risk.
“It’s really quite outrageous,” said Larry McNeely, Health Care Advocate for the U.S. Public Interest Research Group. McNeely added that since the merger, “We’re seeing some significant problems for consumers.”
For instance, after the corporate team up, Caremark fired off thousands of letters to their patients that were using pharmacies other than CVS. They warned: keep going to your current pharmacy, and additional refills would be subject to an increased co-pay. Worse yet, some letters said no additional refills would be covered at their current location, again, a non-CVS pharmacy.
“This is the kind of power that no individual corporation should have over consumers,” McNeely said. “It sounds like Big Brother trying to intimidate.”
The change in pharmacies forced the Butzske couple to hit the road—literally—to get their medications.
11 News: “How far did you use to have to go and how far do you go now?”
Lonnie Butzske: “About six, seven miles I used to go, now I drive over 40 miles to get my medications filled.”
Peggy Butzske: “If we’ve got the gas it’s fine, and if we don’t, we just don’t.”
There’s also a broader impact.
“There’s no way I can compete anymore,” said Pharmacist George Handal, who works at Doyle’s Pharmacy in Rice Village.
11 News: “Do consumers really have a choice in this?”
Handal: “No, when you get a letter like this, it’s over with. I know I’m going to lose that patient.”
But there’s irony in those letters from Caremark. They promised, “we can help you save money … through CVS Pharmacy,” but consumers like the Butszke’s say their co-pays went up, dramatically.
“Before CVS, it was $40, $50 dollars maybe,” Lonnie Butzske said.
And after the switch?
“In one month it was over $500 co-pay total," he said.
That forces the couple to make some difficult decisions.
Lonnie Butzske: “Well, I try to get one or two (prescriptions) a month filled.”
11 News: “But you have 16 prescriptions from your doctor?”
Lonnie Butzske: “I know, I know. So there’s a lot I don’t take, I don’t even take.”
11 News: “Because?
Lonnie Butzske: “I can’t afford it.”
But U.S. PIRG’s McNeely claims there’s also one more victim.
“CVS and Caremark have colluded to essentially steal from not only seniors, but from the tax payers,” McNeely said.
Retirees Max and Jan Hauser say they have first-hand knowledge.
“I picked these up and I said ‘Explain this to me!’” Max Hauser said.
The couple said they made the switch to CVS after getting one of those letters. But when they examined their Medicare paperwork, they got a shock.
Remember, Caremark manages drug costs for companies and governments, telling pharmacies how much they can make for a prescription. But the Hauser’s discovered when it came to Medicare, CVS was allowed to charge much more for a drug than the other pharmacies Caremark deals with.
For an ulcer drug, the Hauser’s original pharmacy made only $4.77 from Medicare. But for the same prescription, CVS made $62.59 in Medicare bucks.
How about a cholesterol drug. Under Caremark, the independent drug store got $0 from Medicare plus a $4.70 co-pay from the Hausers. But CVS charged Medicare and made $165.99.
“When we seen that big difference, it was unreal,” Jan Hauser said.
And those big payouts to CVS have a very real consequence for Medicare seniors. That’s because Medicare only helps pay for prescriptions to a limit. Once that limit’s reached, seniors pick up the full tab. So if CVS/Caremark inflates the Medicare charges:
“It increases the likelihood that seniors have to cover the full cost of their prescriptions all by themselves,” McNeely said.
Max Hauser said he knows, because he says it’s happening to him.
“I’m going to run out of money probably next month,” Hauser said.
“I can’t afford this. CVS is going to break me.”
Now what does CVS Caremark have to say regarding the above complaints?
The company did not respond to our on-camera interview requests, but did send us a statement which states in part:
- “The 2007 merger of CVS and Caremark is making pharmacy health care more accessible, more effective and more affordable. Our integrated pharmacy and PBM operations provide greater choice and more convenience for customers and patients, improve health outcomes, and lower overall health care costs for plan sponsors and participants. Any suggestions that our business practices are anti-competitive or that we are violating antitrust laws are totally false.”
- Another part of the statement seems to regard letters CVS Caremark sent to patients, some of whom complained that the letters were pushing them to fill prescriptions at a CVS drugstore. But the company said it has a special program that lets patients get 90 days worth of maintenance medications at a lower co-pay. When the health plan the patient is with chooses this program, CVS Caremark said letters are often sent out to patients “describing their health plan benefit and advising them of the savings associated with filling their maintenance prescriptions at mail order or through the convenient pick-up option now offered at CVS pharmacies.”
- Another part of the statement seems to regard the Hauser’s and their allegations: CVS Caremark states “… any Medicare Part D plan participant is free to choose which network pharmacy to use, and there are no restrictions that limit a participant’s choice of pharmacy. Therefore, if a Part D participant is not satisfied with the price charged at any network pharmacy, he or she can go to any other network pharmacy to fill prescriptions.”
- And yet another part of the statement seems to be about the Butzske’s and their complaints about having to pay high co-pays at CVS: The statement said: “Any co-pay for any prescription they fill would be based on the requirements of their health plan sponsor’s plan design—their co-pays would not be determined by CVS Caremark.”
Finally, CVS Caremark does admit that there is a current non-public investigation being conducted by the Federal Trade Commission into “certain of the company’s business practices.” KHOU is not able to determine whether the investigation has anything to do with some of the practices and complaints mentioned above.
For Caremark’s full statement, click here.
