Healthcare: Caremark Profits Rose 15% in 2006
An illustration of why PBMs are such wonderful cash cows for the insurance boys:
For the year ended Dec. 31, Caremark reported that its profit grew 15 percent to $1.07 billion compared with profit of $932 million in 2005. Caremark’s revenue grew 11 percent in 2006 to more than $36.7 billion from revenue of nearly $33 billion in 2005.
Keep in mind that Caremark was being courted by two suitors at the end of 2006: CVS and ExpressScripts. CVS won, just last week.
What those profits mean to the insureds: Denied claims and substandard claims review.
What those profits mean to employers: No reduction in the overall burden of providing pharmacy benefits.
What those profits mean to the healthcare system overall: Erosion of the quality and standard of care available to all insureds, and in particular, insureds who are covered by Medicare or Medicaid.
Did I mention that the CEO of Caremark’s predecessor (AdvancePCS), David Halbert is a good buddy of our esteemed President? Did I also mention that he was one of the key drafters of the current Medicare pharmacy benefit laws? Follow the money.
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