CalPERS Selects Caremark as Pharmacy Benefit Manager; CEO Resigns
The California Public Employees Retirement System on Wednesday chose Caremark Rx Inc. to administer prescription drug benefits for its self-insured health plans in 2003, the Sacramento Bee reports. Caremark, which won the $265 million contract over former contract holder Merck-Medco and three other bidders, will handle pharmacy benefits for about 285,000 members enrolled in PERS Care and PERS Choice. The decision "prompt[ed] a protest" from Merck-Medco, which has run pharmacy benefits for CalPERS since 1989 and claimed "irregularities" in the bidding process, the Bee reports. But CalPERS spokesperson Patricia Macht said the decision was based on Caremark's price, drug availability, retail and mail-order prescription services and disease-management programs. "What we have here is a losing vendor making a valiant attempt to rescue business," she said, adding, "The board believes the process was fair." Merck-Medco has five days to file a formal complaint with CalPERS, a move that could lead to another contract review next month, the Bee reports (Rapaport, Sacramento Bee, 5/16).
In related news, CalPERS CEO James Burton on Wednesday announced his resignation from the position he has held for eight years. Burton said he will now enter the private sector, after spending 27 years as a public servant (Wallace, San Francisco Chronicle, 5/16). Burton will leave the agency this fall (Calbreath, San Diego Union Tribune, 5/16).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.