By Craig Clough, LAW360
June 12, 2020
Law360 (June 12, 2020, 7:24 PM EDT) — A proposed class of Amtrak, Lowe’s Cos. and Warner Media employees with HIV and AIDS urged the Ninth Circuit in a video hearing on Friday to revive claims that their health plans discriminate by providing medications solely through CVS Health Corp., which only provides mail and drop box delivery.
By only allowing the medications to be delivered by mail or drop box locations, patients suffer numerous harms, including an inability to have a meaningful consultation with pharmacists and being at the mercy of mail delays, the panel was told.
“HIV patients can survive their disabling condition as long as they have ongoing and reliable access to their anti-viral medications,” Jerry Flanagan of Consumer Watchdog told the panel during a video teleconference. “The move to mail-only delivery for HIV medications puts the appellants’ lives at risk. Routine delivery delays and missed dosages result in an increased viral load for HIV patients, threatening serious health consequences.”
The unnamed plaintiffs suing their three employers and CVS said they preferred using community pharmacies where they’d built up relationships, and that there have been privacy and delivery issues with CVS, in addition to other inconveniences.
Under the plans, specialty drugs must come from a CVS pharmacy in California that delivers to store branches and patients’ homes. In 2018, U.S. District Judge Edward M. Chen ruled that there’s no discrimination under the Affordable Care Act as long as all specialty drugs fall under this category, and not just HIV and AIDS drugs. The patients appealed the ruling.
Flanagan told the panel that patients receiving the drugs by mail cannot reach pharmacists on the phone — despite CVS claiming they would be available — and patients picking up the drugs at a drop box location could not consult the pharmacists there, because those pharmacists didn’t put the drugs together and therefore could not answer meaningful questions about them.
Flanagan also said that, because the HIV and AIDS drugs were treated separately, CVS has no knowledge about potential interactions the patients may have with their other prescriptions.
“Because there is a loss of meaningful access, appellants seek a reasonable accommodation that would not upend the health insurance system,” Flanagan said.
The U.S. Supreme Court’s 1985 ruling in Alexander v. Choate came up often during Friday’s arguments. In that case, the high court held that Tennessee’s reduction in annual inpatient hospital coverage under Medicaid from 20 days to 14 days did not deny disabled people meaningful access because the limitation was neutral on its face.
The court also held that “assuming” that Section 504 of the Rehabilitation Act of 1973 “or its implementing regulations reach some claims of disparate impact discrimination, the effect of Tennessee’s reduction in annual inpatient hospital coverage is not among them.”
U.S. Circuit Judge Andrew D. Hurwitz pointed out to Flanagan that Choate assumed a disparate impact but didn’t actually find that there was one under the Rehabilitation Act, and that “we’ve sort of assumed it since.”
Judge Hurwitz asked Flanagan if the issue was solved in the Ninth Circuit, and if not, would the panel have to decide it for the CVS case.
Flanagan said the case “has relied on Choate’s analysis to find that under Section 504 there was a disparate impact” but that the panel did not have to reach in the CVS case that one exists.
“The question is whether there’s a loss of meaningful access, that’s what Choate was focused on,” Flanagan said.
Craig Singer, representing CVS, told the panel that it is “clear from Choate that you don’t look at whether the benefit provides the best care, or even whether it provides good care, you look at whether it provides the same care across the board to everybody getting the benefit.”
He added that if the patients were not getting phone access to CVS pharmacists, that would not be up to CVS’s standards, but it still would not be discriminatory.
“Everybody who is getting specialty medicines through the plan, through that benefit, is subject to the same terms and conditions,” Singer said. “And if you change that, if you’re allowed to change that, then it will have enormous impacts on the way that insurance is delivered in this country.”
The workers are represented by Jerry Flanagan of Consumer Watchdog.
CVS is represented by Craig Singer of Williams & Connolly LLP.
Amtrak is represented by Sean K. McMahan, Brian W. Shaffer and Elise M. Attridge of Morgan Lewis & Bockius LLP.
Lowe’s is represented by Phillip J. Eskenazi, Kirk A. Hornbeck and Kenneth P. Hsu of Hunton Andrews Kurth LLP.
Warner Media is represented by Michael Bernstein and Jean E. Tomasco of Robinson & Cole LLP and Scott D. Mroz of Walsworth-WFBM LLP.
The case is Doe One et al. v. CVS Health Corp. et al., case number 19-15074, in the U.S. Court of Appeals for the Ninth Circuit.
–Additional reporting by Dani Kass. Editing by Nicole Bleier.