`
`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF OKLAHOMA
`
`THE CHOCTAW NATION,
`
`Plaintiff,
`
`v.
`
`1. CAREMARK PHC, LLC;
`2. CAREMARK PCS HEALTH, LLC;
`3. CAREMARK, LLC;
`4. CAREMARK RX, LLC;
`5. AETNA, INC.;
`6. AETNA HEALTH, INC.;
`7. OPTUMRX, INC.;
`8. OPTUM, INC.;
`9. OPTUMRX HOLDINGS, LLC;
`10. UNITED HEALTHCARE SERVICES,
`INC.; and
`11. UNITEDHEALTH GROUP, INC.
`
`Defendants.
`
`21-CV-128-SPS
`Civil Action No. _____________
`
`COMPLAINT FOR DAMAGES AND DECLARATORY RELIEF
`
`
`
`
`
`I.
`
`II.
`
`III.
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`IV.
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`TABLE OF CONTENTS
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`
`
`INTRODUCTION ...............................................................................................................3
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`PARTIES .............................................................................................................................7
`
`A.
`
`B.
`
`C.
`
`The Choctaw Nation (Plaintiff) ...............................................................................7
`
`CVS Defendants.......................................................................................................8
`
`Optum Defendants .................................................................................................11
`
`JURISDICTION AND VENUE ........................................................................................13
`
`LEGAL FRAMEWORK ...................................................................................................14
`
`A.
`
`B.
`
`Indian Health Service Provides Funding for the Nation’s Healthcare ...................15
`
`The IHCIA Authorizes the Nation to Recoup from Third Parties the Cost
`of Services Provided to the Nation’s Members .....................................................17
`
`V.
`
`FACTUAL ALLEGATIONS ............................................................................................19
`
`A.
`
`B.
`
`C.
`
`D.
`
`Defendants Profit from PBM Services at the Expense of Patient Care .................20
`
`The Nation Operates ITU Pharmacies, Which Are Federally Exempt
`from Defendants’ Schemes ....................................................................................22
`
`1.
`
`2.
`
`The Nation Is Entitled to Recoup Service Costs from Defendants
`under the Recovery Act .............................................................................24
`
`Defendants Are Subject to the Recovery Act ............................................25
`
`Defendants Violate the Recovery Act....................................................................25
`
`Defendants Leverage Discount Programs to Unlawfully Hinder the
`Nation’s Recoupment Benefit ................................................................................27
`
`1.
`
`2.
`
`3.
`
`Discount Programs Create Significant Profit for PBMs ............................27
`
`ITU Pharmacies Traditionally Ignored Discount Programs ......................29
`
`Defendants Inextricably Integrated Their Discount Program
`Information into Members’ Insurance Information ...................................30
`
`i
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`4.
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`Defendants’ Integrated Discount Program Information Forces the
`Nation to Either Pay or Forgo Recovery under the Recovery Act ............30
`
`E.
`
`F.
`
`Defendants Continually and Intentionally Refuse to Repay the Nation ................34
`
`Defendants’ Conduct Impairs the Quality of the Nation’s Healthcare
`Program ..................................................................................................................35
`
`VI.
`
`COUNTS............................................................................................................................36
`
`VII.
`
`PRAYER FOR RELIEF ....................................................................................................41
`
`VIII.
`
`JURY DEMAND………………………………………………………………………...42
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`ii
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`
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`I.
`
`INTRODUCTION
`
`1.
`
`This litigation concerns the federal statutory claims of a federally recognized Native
`
`American Nation—Plaintiff The Choctaw Nation (“Nation”)—under the Indian Health Care
`
`Improvement Act (“IHCIA”). The IHCIA contains a financial recoupment mechanism codified in
`
`25 U.S.C. § 1621e (the “Recovery Act”), which authorizes Native American tribes and nations to
`
`recover the cost of healthcare services they provide to members of federally recognized tribes or
`
`nations (“Members”). The Recovery Act authorizes the recovery of these costs from third parties
`
`responsible for Members’ insurance coverage.
`
`2.
`
`The Nation operates several pharmacies under the IHCIA (known as “ITU
`
`Pharmacies”) providing services to Members, including many citizens of Oklahoma. Pursuant to
`
`federal law, Members are eligible to receive health care (including prescription drugs and other
`
`pharmacy services) at the Nation’s facilities at no charge, with no co-pays or other fees. However,
`
`the ITU Pharmacy must still pay for the costs of the medications it dispenses to Members. To
`
`offset these costs, the Nation has the right under the Recovery Act to recoup the costs of covered
`
`services the Nation provides to a Member from any applicable insurance coverage the Member
`
`may have.
`
`3.
`
`Defendants at issue are those Pharmacy Benefit Managers (“PBMs”) who ignore
`
`this federal law by rejecting or otherwise hindering the Nation’s claims for reimbursement.
`
`Defendants unlawfully reject the Nation’s claims for reimbursement and/or hinder the Nation’s
`
`ability to recover its costs. This leaves the Nation without the benefit of this essential, and federally
`
`required, cost recovery mechanism. Thus, Defendants violate the Recovery Act.
`
`4.
`
`The Nation respectfully requests the Court enter judgment in its favor and award
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`damages as set out in COUNTS ONE and TWO or, alternatively, disgorgement as set out in
`
`3
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`
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`
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`COUNT THREE; injunctive relief as set out in COUNT FOUR; declaratory relief as set out in
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`COUNT FIVE; attorney’s fees and cost of litigation; and any other relief this Court deems proper.
`
`II.
`
`SUMMARY OF THE CASE
`
`5.
`
`This case arises under federal laws1 guaranteeing Native Americans access to
`
`healthcare. With the support of these laws, the Nation has established a robust healthcare system,
`
`which includes several ITU Pharmacies2 throughout the territory of the Choctaw Nation. The
`
`Nation’s ITU Pharmacies provide services to Members, including many citizens of Oklahoma.
`
`6.
`
`Pursuant to federal law, Members are eligible to receive health care (including
`
`pharmacy services) at the Nation’s facilities at no charge. The Member pays no co-pay or other
`
`fees for healthcare services, including prescription medications he or she receives from the
`
`Nation’s ITU Pharmacies. However, the ITU Pharmacy must still pay for the costs of the
`
`medications it dispenses to Members. To offset these costs, the Nation has the right to recoup the
`
`costs of covered services the Nation provides to a Member from any applicable insurance coverage
`
`the Member may have. The Nation therefore enjoys the status of a “payor of last resort.” Clear,
`
`unambiguous federal laws guarantee this right. Defendants ignore these laws and fail to reimburse
`
`the Nation.
`
`
`1 25 U.S.C. § 1621, et seq.; see Section IV—“Legal Framework”, infra.
`2 “ITU Pharmacies” are those pharmacies operated by Indian Health Service (“IHS”), an Indian
`tribe or tribal organization, or an urban Indian organization, all of which are defined in Section 4
`of the Indian Health Care Improvement Act (“IHCIA”), 25 U.S.C. 1603. The Nation’s pharmacies
`are ITU Pharmacies.
`When a Member of any Nation visits an ITU Pharmacy (whether run by that Member’s respective
`nation or another nation), that Member receives services for no charge, and that ITU Pharmacy
`has a 25 U.S.C. § 1621e right of recoupment against the Member’s insurer (if the Member has
`coverage).
`
`4
`
`
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`
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`7.
`
`Defendants make up
`
`two of
`
`the
`
`largest vertically
`
`integrated pharmacy
`
`conglomerates in the U.S. They consist of captive PBMs, along with large health insurance plans
`
`and networks. They provide and manage many of the insurance programs covering Members. The
`
`CVS Defendants3 allocate a significant portion of their management services to (and derive a
`
`complementary proportion of revenue from) their captive pharmacy benefits plan under the
`
`subsidiary, Defendant Aetna. Similarly, the Optum Defendants4 allocate a significant portion of
`
`their management services to (and derive a complementary proportion of revenue from) the
`
`pharmacy benefit plans of the Optum parent company—Defendant United Health Group. Of
`
`course, these relationships make up a respectively predominant portion of each of the CVS and
`
`United Health Group conglomerate’s revenue stream and allow Defendants to exert significant and
`
`substantial control over the pharmacy market.
`
`8.
`
`In approximately 2015, the Nation’s ITU Pharmacies began experiencing numerous
`
`and unprecedented claim denials. These denials emanated from Defendants’ various PBM entities
`
`on behalf of the respective health benefits plans they managed (predominantly, Aetna and United
`
`Health Group plans). Defendants began denying claims—claims for covered drugs, for which the
`
`Nation had previously submitted and received reimbursement without issue—for reasons that have
`
`no applicability whatsoever to ITU Pharmacies. These denials were based on Defendants’ retail
`
`pharmacy rules from which the Nation is exempt.5 These claim denials violate specific provisions
`
`
`3 The “CVS Defendants” are Defendants Caremark PHC, LLC; CaremarkPCS Health, L.L.C.;
`Caremark, L.L.C.; Caremark Rx, L.L.C.; Aetna, Inc.; and Aetna Health, Inc. See Section II—
`Parties, infra.
`4 The “Optum Defendants” are OptumRx, Inc.; OptumRx Holdings, LLC; Optum, Inc.;
`UnitedHealth Group, Inc.; and United Healthcare Services, Inc. See Section II—Parties, infra.
`5 See Section V.B., infra. These unlawful denials were based on many of Defendants’ retail
`pharmacy rules, which are wholly inapplicable to ITU Pharmacies. These rules include but are not
`limited to requirements that (a) patients use a specialty pharmacy to fill certain prescriptions; (b)
`patients visit an in-network pharmacy; or (c) patients use a mail-order pharmacy. While these
`
`5
`
`
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`
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`of the IHCIA and deprive the Nation of critical healthcare funding. They impact the livelihood of
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`some of the most vulnerable Native American Member-patients.
`
`9.
`
`In further violation of the law, Defendants employ a novel scheme whereby they
`
`effectively compel the Nation’s ITU Pharmacies to participate in their many drug discount
`
`programs. Because Members pay no fee for their prescription medications and other pharmacy
`
`services at ITU Pharmacies, Defendants’ discount programs force the Nation to incur a loss in
`
`order to benefit from its right to recover costs for covered medications. Discount program
`
`information was, until recently, separate and distinct from the insurance benefit information an
`
`ITU Pharmacy needed to file a reimbursement claim with an insurer. Previously, the ITU
`
`Pharmacy could avoid the forced loss by simply removing the discount information from a
`
`Member-patient’s file. But now, Defendants have inextricably integrated discount program
`
`information with Member’s insurance information. Therefore, the Nation must either (a)
`
`participate in the drug discount programs at a loss or (b) forgo reimbursement that is guaranteed
`
`and protected by federal law and essential to the Nation’s healthcare budget. This constitutes an
`
`unlawful hindrance of the Nation’s ability to avail itself of the federal recoupment provision in
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`violation of federal law. See 25 U.S.C. § 1621e(c).6
`
`10.
`
`Defendants knowingly, intentionally, and unjustifiably refuse to pay to the Nation
`
`the funds it is entitled to recoup for pharmaceutical benefits, medical devices, and other products
`
`and services provided to Members with Defendant-administered and/or -issued coverage.
`
`
`requirements may be contractually valid between Defendants and a retail pharmacy, Defendants
`cannot deny reimbursement claims from ITU Pharmacies for these reasons. See 25 U.S.C. § 1621e.
`6 Reimbursement from insurers does not offset, reduce, or otherwise impact the amount of
`healthcare funding the Nation receives from other sources, including the federal Government. The
`funds Defendants wrongfully withhold from the Nation would otherwise increase the Nation’s
`healthcare budget and allow it to serve its at-need population. Defendants thereby act in direct
`contravention of federal policy promoting health care for Native Americans.
`
`6
`
`
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`
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`Defendants blatantly and intentionally ignore their legal obligation to the Nation. They have, for
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`years, ignored the Nation’s requests for both repayment and explanation.
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`11.
`
`After myriad attempts to resolve Defendants’ wrongs, the Nation now seeks relief
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`from this Court in the form of payment of all withheld costs of pharmaceutical benefit services the
`
`Nation provided, and continues to provide, to Members from Defendants—as insuring and/or
`
`administering the insurance plans of those Members—as well as equitable relief to prevent the
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`Defendants’ wrongful acts from continuing.
`
`III.
`
`PARTIES
`
`A.
`
`The Choctaw Nation (Plaintiff)
`
`12.
`
`The Choctaw Nation (the “Nation”) is a sovereign and federally recognized Native
`
`American tribal nation headquartered at 1802 Chukka Hina, Durant, Oklahoma, 74701. The Nation
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`has a vibrant and unique cultural heritage, along with a strong tradition of organized self-
`
`government. The Nation pursues its stated mission of enhancing the overall quality of life of the
`
`Choctaw people in part through its healthcare system. Through perseverance and extraordinary
`
`effort, along with the support of federal funding and recoupment from insurers under 25 U.S.C.
`
`§ 1621e, the Nation has developed a comprehensive healthcare system, which includes several
`
`ITU Pharmacies throughout the Nation and located in the State of Oklahoma. In accordance with
`
`the intent of federal programs supporting the Nation, the Nation’s ITU Pharmacies provide
`
`prescription medications (and even the most expensive specialty medications) at absolutely no cost
`
`to Members. This is supported by the recoupment provisions codified in 25 U.S.C. § 1621e, as
`
`explained in Section IV, infra.
`
`
`
`
`
`7
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`
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`B.
`
`CVS Defendants
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`13.
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`The pharmacy conglomerate operating under the brand “CVS” is one of the largest
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`companies in the U.S. It is currently listed as number five in the Fortune 500 list.7 CVS is a
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`vertically integrated healthcare company: it operates one of the nation’s largest retail pharmacy
`
`network, owns the largest PBM—Caremark, and is the nation’s largest provider of individual Part
`
`D prescription drug plans, with over 7.6 million enrollees as of 2019. The CVS conglomerate earns
`
`billions of dollars in annual revenue.
`
`14.
`
`In acquiring Aetna in 2018, CVS purchased the nation’s third-largest health-
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`insurance company and fourth-largest individual Part D insurer. Aetna was required to sell off its
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`standalone Medicare D prescription drug plan as part of the merger. Aetna sold it to WellCare, and
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`CVS Caremark is now the PBM and third-party administrator for WellCare.
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`15.
`
`The CVS conglomerate is wholly owned and controlled by the holding company
`
`CVS Health Corporation.8
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`16.
`
`As used throughout this Complaint, the “CVS Defendants” are Defendants
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`Caremark PHC, LLC; CaremarkPCS Health, L.L.C.; Caremark, L.L.C.; Caremark Rx, L.L.C.;
`
`Aetna, Inc.; and Aetna Health, Inc. On information and belief, each is a wholly owned subsidiary
`
`of the CVS Health Corporation holding company or one of CVS Health Corporation’s wholly
`
`owned subsidiaries.9
`
`17.
`
`Defendant CaremarkPCS Health, L.L.C. and Caremark L.L.C. are agents and/or
`
`alter egos of Defendant Caremark Rx, L.L.C., and Defendant Caremark Rx, L.L.C. is an agent
`
`
`7 See Fortune 500 List, available at https://fortune.com/fortune500/ (last visited Aug. 4, 2020).
`8 See CVS Health Corporation SEC Form 10-k for fiscal year ended Dec. 31, 2019, available at
`https://www.sec.gov/ (last visited Aug. 09, 2020).
`9 See Id.
`
`8
`
`
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`
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`and/or alter ego of CVS Health. For example, Jonathan C. Roberts, CEO of Caremark Rx, L.L.C.,
`
`is Executive Vice President and Chief Operating Officer of CVS Health Corporation. Thomas S.
`
`Moffatt, Secretary of Caremark Rx, L.L.C. and Caremark, L.L.C., is a Vice President, Assistant
`
`Secretary, and Assistant General Counsel at CVS Health Corporation. Anne E. Klis, CEO of
`
`Caremark, L.L.C., is Vice President of Professional Practice and Training at CVS Health
`
`Corporation. Daniel P. Davison, CEO of CaremarkPCS Health, L.L.C., is Senior Vice President
`
`of Finance at CVS Health Corporation. Melanie K. Luker, Assistant Secretary of CaremarkPCS
`
`Health, L.L.C., is Manager of Corporate Services at CVS Health Corporation.
`
`1.
`
`18.
`
`Defendant Caremark PHC, LLC
`
`Defendant Caremark PHC, LLC (“Caremark PHC”) is a limited liability
`
`corporation that is a wholly owned subsidiary of CVS Health. On information and belief, Caremark
`
`PHC, LLC is part of CVS Health’s PBM business model.
`
`19.
`
`Caremark PHC is registered to do business in Oklahoma and may be served with
`
`process through its registered agent, The Corporation Company, 1833 South Morgan Road,
`
`Oklahoma City, Oklahoma, 73128.
`
`2.
`
`20.
`
`Defendant Caremark PCS Health, LLC
`
`Defendant CaremarkPCS Health, L.L.C., formerly known as Caremark PCS
`
`Health, L.P., is a Delaware limited liability corporation. It was incorporated in 2002 and is
`
`headquartered at 750 West John Carpenter Freeway, Irving, Texas 75039. CaremarkPCS Health,
`
`L.L.C., d/b/a CVS Caremark, provides pharmacy benefit management services to various health
`
`insurance entities. CaremarkPCS Health, LLC is a wholly owned subsidiary of CVS Health.
`
`21.
`
`Caremark PCS Health, LLC is registered to do business in Oklahoma and may be
`
`served with process through its registered agent, The Corporation Company, 1833 South Morgan
`
`Road, Oklahoma City, Oklahoma, 73128.
`
`9
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`3.
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`22.
`
`Defendant Caremark, LLC
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`Defendant Caremark, L.L.C., a California
`
`limited
`
`liability company,
`
`is
`
`headquartered at 2211 Sanders Road, Northbrook, Illinois 60062-6128. Caremark, L.L.C. offers
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`pharmacy benefit management services to various health insurance entities. Caremark, L.L.C. is a
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`wholly owned subsidiary of CVS Health Corporation.
`
`23.
`
`Caremark, LLC is registered to do business in Oklahoma and may be served with
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`process through its registered agent, The Corporation Company, 1833 South Morgan Road,
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`Oklahoma City, Oklahoma, 73128.
`
`4.
`
`24.
`
`Defendant Caremark RX, LLC
`
`Defendant Caremark Rx, L.L.C., a Delaware limited liability company, is
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`headquartered at 211 Commerce Street, Nashville, Tennessee 37201. Caremark Rx, L.L.C.
`
`provides pharmacy benefit management services. Caremark Rx, L.L.C. is a wholly owned
`
`subsidiary of CVS Health Corporation. Caremark Rx, L.L.C. is the parent of Defendant CVS
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`Health Corporation’s pharmacy services subsidiaries and is the immediate or indirect parent of
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`many pharmacy benefit management subsidiaries, including Defendant CaremarkPCS Health,
`
`L.L.C.
`
`5.
`
`25.
`
`Defendant Aetna, Inc.
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`“Aetna” is the brand name for insurance products issued by the subsidiary insurance
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`companies controlled by Defendant Aetna, Inc. Aetna was merged into the CVS conglomerate in
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`2018.
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`26.
`
`Aetna, Inc. offers employee health benefit plans insuring Members. Aetna’s Health
`
`benefits and health insurance plans are offered and/or underwritten by Aetna Health, Inc., et al. On
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`November 28, 2018, CVS completed its acquisition of Aetna.
`
`10
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`27.
`
`Aetna, Inc. is responsible for denying the Nation’s claims under 25 U.S.C. § 1621e
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`by means of its parents CVS Caremark and CVS Health’s PBM.
`
`28.
`
`Aetna, Inc. is headquartered at 151 Farmington Avenue, Hartford, Connecticut
`
`06156.
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`6.
`
`29.
`
`Defendant Aetna Health, Inc.
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`Aetna Health, Inc. is a licensed insurer in Oklahoma. It may be served with process
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`through its registered agent, The Corporation Company, at 1833 South Morgan Road, Oklahoma
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`City, Oklahoma 73128.
`
`C.
`
`Optum Defendants
`
`30.
`
`Optum is a branded part of UnitedHealth Group Incorporated, a for-profit managed
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`health care company based in Minnetonka, Minnesota.10
`
`31.
`
`Defendant UnitedHealth Group Inc. has two main divisions: UnitedHealthcare,
`
`which provides health benefits, and Optum, which provides health services, including pharmacy
`
`benefit management services.
`
`32.
`
`In 2011, UnitedHealth Group formed the Optum brand by merging its existing
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`pharmacy and care delivery services into the single unit, comprised of three main businesses:
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`OptumHealth, OptumInsight, and Defendant OptumRx (UnitedHealth Group’s PBM). Through its
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`Optum brand, the company focuses on data and analytics, pharmacy care services, population
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`health, healthcare delivery and healthcare operations.
`
`33.
`
`The “Optum Defendants” are OptumRx, Inc.; OptumRx Holdings, LLC; Optum,
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`Inc.; UnitedHealth Group, Inc.; and United Healthcare Services, Inc.
`
`
`10 See UnitedHealth Group Incorporated SEC Form 10-k for fiscal year ended December 31,
`2019, available at https://www.sec.gov (last visited Aug. 1, 2020).
`
`11
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`
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`1.
`
`34.
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`Defendant OptumRX, Inc.
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`Defendant OptumRX, Inc. (“OptumRX”) is UnitedHealth Group’s pharmacy
`
`benefit manager and care services group. It operates across 150 countries in North America, South
`
`America, Europe, Asia Pacific, and the Middle East. OptumRX is the pharmacy benefit services
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`subsidiary of UnitedHealth Group, Inc. OptumRx holds approximately 23% of the U.S. PBM
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`market.
`
`35.
`
`OptumRX is responsible for issuing unlawful denials of the Nation’s claims under
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`25 U.S.C. § 1621e on behalf of its parent UnitedHealth Group’s various insurance benefits plans,
`
`as well as other plans OptumRX manages for other insurers.
`
`36.
`
` OptumRX is a California corporation. Its principal place of business is the
`
`UnitedHealth Group headquarters in Minnetonka, Minnesota. OptumRX is registered to do
`
`business in Oklahoma and may be served with process through its registered agent, The
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`Corporation Company, at 1833 S. Morgan Road, Oklahoma City, Oklahoma 73128.
`
`2.
`
`37.
`
`Defendant United HealthCare Services, Inc.
`
`Defendant United HealthCare Services, Inc. is headquartered at 9700 Health Care
`
`Lane, Minnetonka, Minnesota and incorporated in Minnesota. United HealthCare Services, Inc. is
`
`a subsidiary of Defendant UnitedHealth Group, Inc. and provides pharmacy benefit management
`
`services through its subsidiaries to various health insurance entities. According to Exhibit 21.1 to
`
`UnitedHealth Group Incorporated’s 2016 Securities and Exchange Commission Form 10-K,
`
`United HealthCare Services, Inc. also does business as Optum, Inc.
`
`3.
`
`38.
`
`Defendant Optum, Inc.
`
`Optum, Inc. is a PBM headquartered at 11000 Optum Circle, Eden Prairie,
`
`Minnesota and incorporated in Delaware. Optum, Inc. is a subsidiary of UnitedHealthcare
`
`12
`
`
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`
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`Services, Inc., which provides pharmacy benefit management services through its subsidiaries to
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`various health insurance entities on behalf of more than 65 million plan participants.
`
`4.
`
`39.
`
`Defendant OptumRx Holdings, LLC
`
`OptumRx Holdings, LLC is headquartered at 11000 Optum Circle, Eden Prairie,
`
`Minnesota, 55344-2503.
`
`5.
`
`40.
`
`Defendant UnitedHealth Group, Inc.
`
`UnitedHealth Group’s various insurance benefits plans unlawfully denied the
`
`Nation’s claims under 25 U.S.C. § 1621e by means of its captive PBM, Defendant OptumRX.
`
`41.
`
`UnitedHealth Group, Inc. is a Delaware corporation with its principal place of
`
`business in Minnetonka, Minnesota.
`
`IV.
`
`JURISDICTION AND VENUE
`
`42.
`
`This Court may properly exercise jurisdiction over the subject matter of this suit
`
`under 28 U.S.C. § 1331 as the case arises under the IHCIA (see Section IV, infra) and 25 U.S.C.
`
`§ 1621, et al. Furthermore, this Court may properly exercise jurisdiction over the subject matter
`
`of this suit under 28 U.S.C. § 1362, as this matter is brought by a federally recognized Native
`
`American Nation.
`
`43.
`
`This Court may properly exercise jurisdiction over the parties to this suit. The
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`Nation consents to this Court’s exercise of jurisdiction over it for the purposes of this suit.
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`Defendants have sufficient minimum contacts with the State of Oklahoma, including but not
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`limited to the marketing, sale, and execution of contracts for PBM services in Oklahoma, as well
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`as the repeated denial of claims for recoupment of costs of goods and services (a) provided by the
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`Nation to Members in Oklahoma and (b) sent to Defendants from Oklahoma. Defendants have
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`purposefully availed themselves of the privilege of conducting business in Oklahoma such that
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`they are subject to suit here. Additionally, Defendants have targeted their wrongful conduct at
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`13
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`6:21-cv-00128-SPS Document 2 Filed in ED/OK on 04/26/21 Page 15 of 43
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`Members of the Nation in Oklahoma. The Nation’s claims arise out of and relate to Defendants’
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`contacts with the State. This Court’s exercise of jurisdiction is reasonable; the maintenance of this
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`suit does not offend traditional notions of fair play and substantial justice.
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`44.
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`Venue is proper within this judicial district pursuant to 28 U.S.C. § 1391. This
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`action arises out of events, acts, and omissions that occurred in the Eastern District of Oklahoma.
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`Specifically, the Nation provided services to its Members through its ITU Pharmacies in this
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`District. Those services gave rise to the Nation’s claims for reimbursement from Defendants and
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`Defendants’ legal obligation to pay the Nation for those services rendered in this District. The
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`Nation sent those claims to Defendants from this District, and Defendants disseminated their
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`unlawful denials to the Nation in this District. Defendants’ failure to pay the Nation’s claim for
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`reimbursement is the subject of this action.
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`V.
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`LEGAL FRAMEWORK
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`45.
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`The Federal Government’s obligation to provide for, maintain, and improve the
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`health of Native Americans is manifest and inherent to Congress’s federal trust responsibility for
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`Native American nations. See 25 U.S.C. § 1601. It is grounded in both moral imperative and public
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`health necessity. See id. To that end, Congress has passed several laws that guarantee Native
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`Americans access to healthcare and provide Native American nations the financial support they
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`require to develop and implement robust healthcare programs. This suit arises from Defendants’
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`unlawful and unconscionable disregard of these laws.
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`46.
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`This section describes in detail the mechanisms through which the federal
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`government provides funding to the Nation for healthcare services and has empowered the Nation
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`to build its own sophisticated healthcare system. This section then proceeds to explain the federally
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`enacted recoupment mechanism codified in 25 U.S.C. § 1621e, whereby the Nation may recover
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`14
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`the cost of healthcare services it provides Members from third-parties responsible for those
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`Members’ coverage.
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`A.
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`Indian Health Service Provides Funding for the Nation’s Healthcare
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`47.
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`Indian Health Service (“IHS”) is a federal agency within the Department of Health
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`and Human Services that is responsible for providing health care and medical services to federally
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`recognized Native American nations. IHS is not a health insurance program; rather, it is a federally
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`funded health service provider akin to the Veterans Health Administration that provides health
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`services directly to beneficiaries or in conjunction with Native American nations.11
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`48.
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`IHS strives “to raise the physical, mental, social, and spiritual health of [Native
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`Americans] to the highest level” and “to assure that comprehensive, culturally acceptable personal
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`and public health services are available and accessible to [Native American] people.”12 All actions
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`IHS carries out are “directed toward developing an efficient and effective health care delivery
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`system and promoting [Native American] participation and management of their own health care
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`systems.”13
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`49.
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`IHS provides this critical funding in two ways: (1) IHS provides services to Native
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`American nations directly, and/or (2) IHS provides funding and support to Native American
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`nations that have the ability to provide the services themselves.
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`50.
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`Over the past several decades, many Native American nations have moved away
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`from IHS-controlled health care toward systems they control and direct themselves. Under the
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`1975 Indian Self-Determination and Education Assistance Act (“ISDEAA”), 25 U.S.C. § 5301, et
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`11 IHS is one of four similar foundational federal health delivery systems: IHS, Veterans Health
`Administration, Defense Health Agency, and Bureau of Prisons Health Services Division.
`12 Indian Health Services, available at https://www.ihs.gov/aboutihs/ (last visited Feb. 28, 2020).
`13 Id.
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`15
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`seq., nations may assume control over the management of their health care by negotiating “self-
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`determination contracts” with IHS.14 The ISDEAA reflects modern federal policy of tribal self-
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`determination, whereby nations may build the capacity to perform essential governmental
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`functions, improve the programs themselves, and respond directly to their own needs.15
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`51.
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`One can find no better example of self-determination than the Choctaw Nation
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`Department of Health’s network of robust and sophisticated health clinics and ITU Pharmacies,
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`which the Nation developed pursuant to its Title V Self-Governance Compact.
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`52.
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`In furtherance of ISDEAA policy, Congress enacted the Indian Health Care
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`Improvement Act (“IHCIA”) in 1976 to assist Native American nations with their health
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`initiatives.16 The IHCIA was designed to enhance access to and quality of health care services for
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`Native Americans. In fact, the IHCIA was the first federal legislation to enact specific statutory
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`programs for Native American healthcare. In the IHCIA, as amended, Congress established a
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`national policy intended to ameliorate long-standing health care disparities and to provide
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`increased and more effective health care services to Native Americans.
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`14 25 U.S.C. § 5304(j) (2012) (defining “self-determination contract” as “a contract (or grant or
`cooperative agreement utilized under section 5308 of this title) entered into under subchapter I of
`this subchapter between a tribal organization and the appropriate secretary for the planning,
`conduct and administration of programs or services which are otherwise provided to Indian tribes
`and their members pursuant to Federal law”).
`15 Under Title I of the ISDEAA, a nation may contract with IHS to conduct and administer certain
`portions of its health program which were previously operated by IHS (“Title I Self-Determination
`Contracting”). Under Title V, a nation can exercise more independence by taking over the
`operation of its health program in its entirety (“Title V Self-Governance Compacting”). Under
`both Title I Contracts and Title V Compacts, IHS continues to fund all health services. These
`methods are not mutually exclusive. These are collectively referred to as “638 Compacts” after
`Public Law 93-638 (i.e., the I