Behind our FTC settlement: Improving transparency and affordability

CVS Caremark has recently reached a settlement agreement with the Federal Trade Commission that resolves all of the agency’s outstanding litigation and investigations related to CVS Health’s pharmacy benefits management and affiliated pharmacy businesses. The settlement builds on the work we have already done and our commitment to improving transparency, strengthening affordability and simplifying how pharmacy benefits work for our clients and their members.  Importantly, it preserves our ability to negotiate lower drug costs and reinforces our commitment to delivering meaningful value for your plan and its members.  

For decades, CVS Caremark has focused on lowering prescription drug costs, improving access to medications and increasing transparency for employers, health plans and the members they serve. Our settlement reinforces our longstanding approach, including options such as point‑of‑sale rebates, flat administrative fees, and TrueCost™ pricing. It also includes a new standard commercial offering designed to help clients align member cost‑sharing with net drug costs and introduces an insulin affordability option that would cap member costs at $25 per month. 

These ongoing commitments will enhance pharmacy benefits for both your plan and its members.

Committed to lower costs for your members

While we welcome any actions by pharmaceutical companies to lower drug list prices, this simply has not happened enough. However, CVS Caremark has consistently worked to create programs to reduce out‑of‑pocket costs for members, deliver more drug affordability, expand access to lower‑cost options and redesign benefit structures to push savings directly to the point of sale.

Some examples of these efforts include:

• Point‑of‑sale rebates, benefiting more than 25 million members each year*
• Flat‑dollar copays and copay caps
• $0 preventive drug lists
• Leading adoption of generic and biosimilar medications

One area where this is especially clear is insulin affordability. CVS Caremark has led the way in driving lower insulin costs for insured, uninsured and underinsured patients. Through CVS Caremark, members pay on average less than $25 per month for insulin, well below average list prices. Through our ReducedRx® program, every American – insured and uninsured – can access insulin for $25 at more than 60,000 network pharmacies and 9,000 CVS Pharmacy locations nationwide.

With our recent announcement, we expect members enrolled in plans that adopt the standard offering to see even lower out-of-pocket (OOP) costs at the pharmacy counter, particularly for high‑cost maintenance medications like insulin. We are introducing a new patient affordability offering that would cap members’ insulin cost at $25 per month. Lower costs can support better adherence and reduce the likelihood that members abandon prescriptions or seek alternatives outside their benefit.

We are also working on integration with direct to consumer (DTC) programs, such as TrumpRx, as part of our standard offering. This will provide the option to plan sponsors to count DTC-related purchases toward member deductibles and OOP maximums, where allowed by law and subject to certain conditions required by the FTC settlement. 

Our innovative strategies have already helped save members more than $800M at the point of sale while improving access to life‑sustaining medications, and we will continue to focus on driving costs down. 

Committed to greater transparency

We introduced TrueCost in 2023 as the market’s first transparent pricing model, and it changed the way the industry thinks about transparency. Members on the full TrueCost program have seen pricing variability for non-specialty generics decrease by 55% due to the elimination of cross-subsidization. In addition, walkaway rates have declined for many products.^*

Going forward, the standard offering will eliminate spread pricing. Under our transparent fee-for-service model, you will pay the pharmacy’s acquisition cost plus a clearly defined administrative fee. This provides greater clarity into how drug-level costs are calculated and helps you achieve savings goals.

In addition, we are advancing how you receive detailed, claim‑level reporting that shows exactly what was paid for each prescription. This enhanced transparency supports fiduciary oversight and audit requirements. While CVS Caremark provides robust reporting today, we are excited for these new capabilities that will make this information even easier to access and use, give you clearer visibility into costs and enable you to make informed decisions.

Committed to future-proofing pharmacy benefits

CVS Caremark has been proud to champion moves towards greater transparency and affordability for years. The FTC settlement reinforces the direction we are heading and strengthens our ability to deliver clarity, affordability and value.

We will continue to do the job health plans, employers, unions and government organizations hire us to do: make prescription drugs more affordable and accessible for your members.

We’re here to answer your questions

There is no immediate action for you or your members. We will continue to communicate transparently with clients and members about new innovations. If you would like to speak with us more about these advancements, please contact your CVS Caremark Account Manager directly or reach out to us at the below.

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