Rite Aid subsidiary Elixir Insurance Co. pulling out of Puerto Rico market
The company is a Medicare Part D prescription provider that partners with national health care companies.
Elixir Insurance Co., a subsidiary of U.S.-based pharmacy chain Rite Aid, informed its policyholders in Puerto Rico of its plans to discontinue business on the island on Dec. 31, 2024.
As part of its exit, Elixir Insurance Co. has asked the Puerto Rico Office of the Insurance Commissioner (OCIF, in Spanish) to approve the “surrender of its Certificate of Authority to do the business of an insurance company in Puerto Rico,” according to a public notice it published this week.
Attempts to reach Rite Aid officials for further comment were unsuccessful, so it remains unclear how many subscribers the company has in Puerto Rico.
In 2015, Rite Aid acquired Envision Pharmaceutical Services for $2 billion. In 2020, Envision rebranded as Elixir to integrate its pharmacy benefits, services and technology companies.
OCIF said, “Envision Insurance Company had a pending name change to Elixir Insurance Company in our office. The insurer did not respond to follow-ups regarding this transaction and did not request the withdrawal of its certificate.”
“However, according to our data system, their certificate has been inactive since June 30, 2024, since it did not request a renewal,” the agency stated in writing.
Elixir Insurance Co. describes itself as a Medicare Part D prescription provider that partners with national health care companies to provide medications. However, on its website, the company has a notice warning it will no longer offer any individual Medicare prescription drug plans effective Jan. 1, 2024.
“You will need to join another Medicare prescription drug plan to continue to receive prescription drug coverage in 2024,” it stated.
Legal troubles
Earlier this year, Rite Aid and Elixir Insurance Co. agreed to pay $101M to resolve allegations of falsely reporting rebates through a settlement agreement with the U.S. Justice Department.
“The Justice Department announced today that Rite Aid Corporation and Rite Aid subsidiaries, Elixir Insurance Company, RX Options LLC and RX Solutions LLC, have agreed to resolve allegations that they violated the False Claims Act (FCA) by failing to accurately report drug rebates to the Medicare Program,” the federal agency stated in a release.
“Participants in Medicare’s drug program must accurately report price concessions, including drug manufacturer rebates, to ensure that the government receives the benefit of those concessions,” said Brian M. Boynton, principal deputy assistant attorney general and head of the Justice Department’s Civil Division at the time.
“Today’s settlement reflects the Justice Department’s commitment to hold accountable entities that pursue their own financial interests at the expense of taxpayer programs,” Boynton said.
U.S. Attorney Rebecca C. Lutzko for the Northern District of Ohio said, “Rite Aid and its Elixir subsidiaries lined their corporate pockets with millions of dollars of manufacturer rebates that should have been reported to Medicare.”
“Each of those dollars could have been used to benefit Americans with genuine health care needs. Our office will not tolerate deceptive health-insurance practices, and we will vigorously pursue those who violate the FCA,” she said.
Under Medicare Part D, private entities known as Part D Plan Sponsors offer and administer insurance plans that provide prescription drug coverage to enrolled Medicare beneficiaries. Part D Sponsors must submit annual reports to the Centers for Medicare and Medicaid Services with information about rebates and other remuneration the plans received from drug manufacturers in connection with the Part D drugs provided to beneficiaries, which ensures that the government receives the benefit of any price concessions provided by drug manufacturers.
The settlement resolved allegations that, between 2014 and 2020, the defendants improperly reported to CMS portions of rebates received from manufacturers as bona fide service fees, even though manufacturers did not negotiate with the defendants to pay such fees.
The United States further alleged that Elixir Insurance knew the retained rebates did not meet the regulatory definition of bona fide services fees.
Would you print the names of those health plan companies in Puerto Rico which use Elixir to support their Medicare Pt D programs? Thank you.