New York State Audit Finds Discrepancies in CVS Pharmacy Claims
The New York State Comptroller's recent audit of CVS Caremark's pharmacy claim administration for the Empire Plan revealed significant discrepancies within the payment process. This scrutiny was targeted at claims for Medicare-qualified members under the New York State Health Insurance Program (NYSHIP) from January 2022 to June 2025, with an emphasis on high-risk members from January 2019 to December 2025.
NYSHIP is managed by the Department of Civil Service and stands as a leading public sector health insurance initiative in the United States, catering to approximately 1.2 million beneficiaries, including state employees and their families. The Empire Plan, a crucial facet of NYSHIP, extends coverage to over a million members.
The Empire Plan utilizes CaremarkPCS Health, L.L.C. (CVS Caremark) for prescription drug benefit management. CVS Caremark administers both the Empire Plan Medicare Rx drug plan for Medicare-eligible retirees and a Commercial Plan for non-eligible members. Proper claim allocation is essential as the Medicare Rx Plan benefits from manufacturer discounts and federal subsidies, unlike the Commercial Plan.
Member claim processing accuracy is contingent on the New York Benefits Eligibility and Accounting System (NYBEAS), which CVS Caremark uses to categorize claims suitably. Health Benefits Administrators must maintain precise eligibility and enrollment data in NYBEAS to ensure seamless member transition between the plans.
The audit found $19.3 million in pharmacy claims for 338 Medicare-qualified members were incorrectly processed under the Commercial Plan instead of the Medicare Rx Plan. In response, the Department of Civil Service and CVS Caremark have begun reassessing these claims to rectify the discrepancies.
For further details or inquiries on State Government Accountability, interested parties can reach out to Audit Director Christopher J. Morris at the Office of the State Comptroller, Division of State Government Accountability in Albany, NY.