You have to track the litigation. You have to read the administrative complaints. You have to follow the money through the fine print to see how power really operates in American healthcare.
I went onto the Federal Trade Commission's website today and read through Tuesday's global settlement with CVS Caremark. We are talking about a Woonsocket-based giant that manages benefits for roughly 88 million plan members. Mail order pharmacy services, specialty pharmacy, infusion services, formulary management, claims processing—these are the levers that control who gets medicine and who goes without. And this week, the federal government forced a shift in how those levers are pulled.
The agreement resolves the commission's antitrust lawsuit against Caremark over insulin pricing. It is a behavioral settlement that projects up to $8.5 billion in consumer savings over the next ten years, plus another $4.5 billion from point-of-sale rebates.
Rhode Island's largest pharmaceutical employer ended up in the crosshairs of a federal antitrust action because of rebates and the hidden architecture of pharmacy benefit managers, or PBMs.
PBMs negotiate drug prices with manufacturers, reimburse local pharmacies, and determine which medications are covered. For years, the FTC alleged, PBMs tied their own revenue to rebates based on a percentage of a drug's list price. The mechanism is simple but devastating. When a drug costs more, it generates higher rebates and fees for the middleman. Over the last two decades, the cost of insulin shot up 600 percent, forcing one in five U.S. adults with diabetes under age 65 to ration their medication. PBMs created a rebate system that favored this high-priced insulin to line their own pockets.
The new settlement fundamentally alters that math. It delinks PBM fees from drug list prices. In other words, Caremark can no longer financially benefit simply because a manufacturer jacks up the price of insulin.
One could look at the $13 billion in projected savings and call this a total victory. But a behavioral agreement fails to account for the damage already done.
The settlement does not include a single cent in monetary penalties. There is no direct compensation fund for the patients who jeopardized their health by rationing insulin. There is no restitution for the local businesses driven into the ground. In the 1970s, more than 120 independent pharmacies operated in Rhode Island; today, only 12 remain.
Nick Shanos, owner of Suburban Pharmacy in Warwick, told WPRI that PBMs have been squeezing independent pharmacies to the point where many can no longer survive. A January 2026 House Judiciary Committee report backed this up, revealing internal CVS Health documents showing the company monitored independent pharmacies and sent cease-and-desist letters to stifle competitors.
The officials overseeing this shift include FTC Chairman Andrew N. Ferguson, who approved a deal requiring Caremark to stop unfairly interfering with independent pharmacies' ability to work with outside service hubs. Locally, Rhode Island Attorney General Peter Neronha filed an 84-page lawsuit in May 2025 against Caremark, Express Scripts, and Optum Rx.
While the FTC settlement restructures future behavior, Neronha's pending state lawsuit seeks actual restitution. Caremark President Ed DeVaney insists the federal agreement simply "advances and reinforces the changes we have already put in place." A CVS spokesperson pushed back on Neronha's local suit, defending the hometown company and claiming they pay independent pharmacies competitively.
These problems are best confronted with law, details, and enforcement. Rhode Island state employees receive prescription coverage through CVS Caremark when enrolled in state medical plans. Between 2015 and 2019, prescription drug costs grew 114 percent faster than the average Rhode Islander's income. Who pays the price for this architecture? The patients.
The settlement rewrites the rules of the game going forward. The inflated list price is finally being severed from the middleman's profit. But for the patients who rationed their doses, and the 108 independent pharmacies that closed their doors, the fine print of Tuesday's settlement offers little comfort. The levers of power have shifted, but the past remains unpaid for.