Patient Groups Challenge CVS Plan to Deny Coverage Based on ICER Cost-Effectiveness

Dozens of patient groups penned a letter to CVS Health’s President and CEO Larry Merlo urging the company to scrap its recently announced plan to deny coverage of drugs that fail to meet a certain level of cost-effectiveness.

The letter raises concern that CVS Caremark, the company’s PBM subsidiary, will allow its clients to use formularies that rely on assessments from the Institute for Clinical and Economic Review (ICER) to nix coverage of drugs if they don’t meet a threshold based on quality-adjusted life years (QALY).

According to a CVS Health whitepaper released in August, the PBM will allow clients to exclude any drug launched at a price greater than $100,000 per QALY from their plan. It defended its decision by saying that the new approach could help to change manufacturer behavior by “harnessing the power of the market.”