UnitedHealth and CVS Received Millions in Opioid Rebates Through Medicare
As the U.S. opioid crisis deepened, Medicare plans administered by UnitedHealth and CVS Health were a top source of OxyContin sales, a Barron’s investigation found.
UnitedHealth and CVS wear multiple hats in Medicare Part D. They serve as so-called sponsors of drug plans that seniors can purchase each year. They also operate PBMs, the middlemen that negotiate between drugmakers and insurance companies.
UnitedHealth and CVS prescription plans for Medicare also authorized higher amounts of OxyContin compared with plans from some other insurers, Barron’s found.
Neither company had a direct comment when asked about the rebate figures or why their Medicare Part D plans differed from other insurers.
While insurers share some Medicare rebate money with the government, they retained the bulk of it in 2021—about two-thirds of drug rebates and certain pharmacy fees—according to an analysis by the Medicare Payment Advisory Commission, or MedPAC, an independent congressional agency.
The companies can use those rebate funds to offset business costs and offer lower premiums, a fierce point of competition to win Medicare customers. Insurance plans “have had incentives to try to maximize rebates and keep premiums low,” MedPAC said in a 2023 report. The problem for some patients, according to the Government Accountability Office and others, is that rebates don’t directly lower the cost of drugs at pharmacy counters.