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Oxford Health Plan Members Certified as Class Against PCS Health Systems in Action Over Excessive Prescription Costs |
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The class has been certified in a class action filed against pharmaceutical benefits manager PCS Health Systems, Inc. on behalf of Oxford Health Plans, Inc. participants who allege that PCS failed to pass on drug rebates and discounts in violation of the federal Employee Retirement Income Security Act (ERISA) from March 5, 1995, to March 5, 1998. The action seeks unspecified compensatory damages and disgorgement of all profits illicitly gained by the scheme.
Named plaintiff Ed Mulder participated in an employer-sponsored health plan administered by an Oxford HMO. Oxford, like some 1,250 other health insurers, HMOs, and self-funded employee health plans, contracted with PCS to act as pharmaceutical benefits manager. Mr. Mulder filed the action against PCS after PCS switched his cholesterol-reducing prescription to a more expensive drug. The action alleges that PCS breached its fiduciary duties under the Employee Retirement Income Security Act by: (1) entering into contracts with employee benefit plans, HMOs, and insurance companies to secure illegal windfall profits for PCS; (2) implementing programs to influence pharmacists and physicians to switch the drugs of plan participants; and (3) utilizing a method of determining formulary and preferred drugs that did not serve the best interests of plan participants.
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