Inside This Issue - News
Marketing of CVS’ SilverScript PDP resumes
January 6th, 2014
WOONSOCKET, R.I. – Federal regulators have lifted sanctions imposed against CVS Caremark Corp.’s SilverScript Medicare Part D prescription drug plan (PDP).
The Centers for Medicare and Medicaid Services’ action has allowed the company to resume marketing of SilverScript products and begin enrolling beneficiaries.
“We have worked hard to implement improvements to address the enrollment processing issues that occurred in early 2013 and are committed to providing our members with quality service and support,” said Jon Roberts, president of CVS Caremark’s pharmacy benefit management business.
While the sanctions presented a challenge for its Part D business, the company still sees significant opportunity to grow it over the long term, Roberts said, adding that the remediation will enable it to do just that.
“The Medicare Part D market remains a very important part of our growth strategy,” he said at the company’s analyst day. With 15 million people aging into Medicare by 2020, Part D spending is expected to grow at an 8.6% compounded annual rate, he said.
“Individual PDPs will be fueling this growth,” he said, adding that expansion of employer group waiver plans (EGWPs) will continue through 2015, at which point there will be movement from such plans into the individual market.
CVS Caremark is the No. 3 player in the Part D market, covering 6.8 million lives through its PDP and health plan clients as of October 2013.
It expected as of January to serve 4.2 million people with SilverScript products as it brings on new EGWP lives offset by monthly attrition and expected attrition from open enrollment.
Overall, the company’s PBM is delivering on its promise, Roberts said. Its net revenue is projected to climb to $82 billion in fiscal 2014 from $47 billion in 2010, giving it compound annual growth of 14.8%. Operating profit is expected to rise to $3.3 billion from $2.4 billion, which would mean annual growth of 8.8%.