With the high costs of some prescription drugs facing increased scrutiny, some consumers are fighting back against insurance companies who cover a portion of those costs. Case in point: some UnitedHealth customers are suing the insurer claiming it overcharged for prescription drugs. 

The potential class-action lawsuit, filed this week by three UnitedHealth customers in a federal court in Minnesota, accuses the insurer of creating a “secret” system that charged clients co-payments far in excess of the costs of actual drugs, and then pocketing the difference.

According to the complaint [PDF], UnitedHealth’s charges were “improper and illegal” because the insurer was already paid to provide prescription drugs through health-insurance premiums.

These premiums are the result of agreements between the insurance company and Pharmacy Benefit Managers (PBM). In most cases, a health insurance policy provides prescription drug benefits, and a PBM is the agent of the insurance company hired to administer the prescription drug to retail pharmacies.

When a patient either presents or picks up a prescription at a pharmacy, key information such as the patient’s name, drug dispensed, and quantity dispensed is transmitted to the correct PBM.

The PBM instantaneously processes the claim according to the benefits plan assigned to the patient, and sends that information — including any payment from the customer owed to the pharmacy.

In the case of UnitedHealth, the customers claim the company, which manages its own PBM called Optum, created a system in which the client’s co-payment was in excess of the price negotiated with the pharmacy. This created a “clawback” or overcharge that was then returned to the insurer.

For example, one of the plaintiffs claim in the suit that he paid a $50 co-payment for a contraceptive prescription, while UnitedHealth paid the pharmacy only $11.65. Under the pharmacy and insurer agreement, once the customer paid, the pharmacy was directed to pay the excess $38.85 to UnitedHealth.

UnitedHealth’s co-payment is not a “‘co-‘ payment for a prescription drug because the insurer is paying nothing, but instead is getting a material portion the insured’s payment funneled back to it in secret,” according to the complaint.

This, despite the fact that co-payments are defined in the policy section of UnitedHealth’s agreements as “Cost-Sharing,” where the expense is shared between the insured and the insurer.

The lawsuit claims UnitedHealth’s co-payments violate the Racketeer Influenced and Corrupt Organizations Act (RICO) and in some cases also violate a federal law governing employee benefit plans.

A rep for UnitedHealth tells Bloomberg that it has not yet been served with the complaint, but noted that “pharmacy benefits are administered in line with the coverage described in the plan documents.”

UnitedHealth Accused of Gouging Customers on Prescription Drugs [Bloomberg]

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