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Mayo Clinic Employee Files Class Action Lawsuit Over High Health Care Costs [Weekly Roundup]

Mayo Clinic employee files class action lawsuit over high health care costs and other notes from around the interweb:

  • Mayo Clinic employee files class action lawsuit over high health care costs. The worker, who is unnamed in the lawsuit, is seeking reimbursement for the money they allege they overpaid for care that should have been reimbursed — as well as for the thousands of other Mayo Clinic employees and Medica customers they believe are similarly situated and paid more than they should have for care. The lawsuit alleges Medica, which administers Mayo Clinic’s self-insured plan, uses “deceptive, misleading, arbitrary” pricing methods that leave plan members in the dark about health costs and allow for inconsistent reimbursement rates, in violation of federal law and Medica’s fiduciary responsibilities.
  • Mark Cuban: Five Ways that Big PBMs Hurt U.S. Healthcare–And How We Can Fix It. #1 Zero transparency. The number one rule when contracting with PBMs is that you don’t talk about the PBMs and their contracts. They prevent everyone–providers, manufacturers, employers, and non-affiliated pharmacies—from making public or discussing their pricing terms or any aspect of their contracts. If you do, they’re happy to sue you.
  • Amid increased federal scrutiny, PBMs pivot strategy to further squeeze independent pharmacies. Pharmacy benefits managers (PBMs) are employing new strategies to squeeze independent pharmacies, even as the industry faces pressure from the federal government, which is looking for ways to curb healthcare’s middlemen and preserve competition in medicine distribution. Independent pharmacies have complained for years about unfair tactics used by PBMs to force them out of business, including underpaying for filled prescriptions and reimbursement clawbacks. It has gotten the attention of Congress, and the Federal Trade Commission (FTC) is in the middle of a probe with results due this year. Meanwhile, another tactic is starting to see an anecdotal increase: terminations.
  • It’s time for facts in the PBM debate. You’ve also likely heard recently from Mark Cuban, who has an emerging side hustle as a pharmacy expert. His company, Mark Cuban Cost Plus Drugs, has a narrow offering, and focuses on the cost of generic drugs. That’s a problem that has already been solved. Over the past decade, many organizations have built sophisticated businesses focused on reducing the cost of generic drugs in this country. The reality is, the Cost Plus offering is neither novel nor unique—it is a generic sourcing business that is 10 years too late. What’s more, it often lacks a consistent supply of products and regularly stocks treatments with short expiration dates, failing to offer the comprehensive and reliable service needed to deliver high-quality pharmacy benefits to a large patient population.

Tyrone Squires, MBA, CPBS

I am the proud founder and managing director of TransparentRx, a fiduciary-model PBM based in Las Vegas, Nevada. We help health plan sponsors reduce pharmacy spend, by as much as 50%, without cutting benefits or shifting costs to employees.

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