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Commitments and Contingencies
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3 Months Ended |
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Mar. 31, 2015
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| Commitments and Contingencies Disclosure [Abstract] | |
| Commitments and Contingencies | Commitments and Contingencies In July 2014, the Company received a subpoena from the United States Attorney's Office for the District of Rhode Island, requesting documents and information concerning bona fide service fees and rebates received from certain pharmaceutical manufacturers in connection with certain drugs utilized under Part D of the Medicare program. The Company has been cooperating with the government and collecting documents in response to the subpoena. Beeman, et al. v. Anthem Prescription Management, Inc., et al. A purported class action lawsuit was filed in February 2004 in the United States District Court for the Central District of California against a number of pharmacy benefit managers, including current subsidiaries of the Company, by several California pharmacies. Plaintiffs allege that defendants failed to comply with statutory obligations under California Civil Code Section 2527 to conduct studies of pharmacy dispensing fees and provide the results to third party payors in California, and seek money damages. Because the lawsuit was stayed by appeals, including a challenge to the constitutionality of the statute, for nearly its entire history and was remanded back to the District Court in 2014, it is still in its early stages. As of March 31, 2015, based on currently available information, the Company cannot reasonably estimate a potential impact in this matter. Shareholder Litigation Related to the Acquisition. In April 2015, four purported shareholders of the Company filed four putative class action complaints in the Circuit Court of Cook County, Illinois, each on behalf of a purported class of shareholders. Each of the lawsuits names the Company, each of the Company's directors and UnitedHealth Group as defendants. The lawsuits allege, among other things, the Company’s directors breached their fiduciary duties by failing to take steps to ensure that the putative class members will obtain adequate and fair consideration under the circumstances. The lawsuits allege that UnitedHealth Group aided and abetted our directors’ breach of fiduciary duties. Based on these allegations, the lawsuits seek, among other relief, injunctive relief enjoining the proposed Acquisition or, in the alternative, damages in the event the Acquisition is consummated. These lawsuits are in a preliminary stage. From time to time in connection with its operations, the Company is named as a defendant in actions for damages and costs allegedly sustained by third party plaintiffs. The Company has considered these proceedings and disputes in determining the necessity of any accruals for losses that are probable and reasonably estimable. In addition, various aspects of the Company’s business may subject it to litigation and liability for damages arising from errors in processing the pricing of prescription drug claims, failure to meet performance measures within certain contracts relating to its services performed, its ability to obtain certain levels of discounts or rebates on prescription purchases from retail pharmacies and drug manufacturers or other actions or omissions. The Company’s recorded accruals are based on estimates developed with consideration given to the potential merits of claims or quantification of any performance obligations. The Company takes into account its history of claims, the limitations of any insurance coverage, advice from outside counsel, and management’s strategy with regard to the settlement or defense of such claims and obligations. While the ultimate outcome of those claims, lawsuits or performance obligations cannot be predicted with certainty, the Company believes, based on its understanding of the facts of these claims and performance obligations, that adequate provisions have been recorded in the accounts where required. As of March 31, 2015, the Company did not have any material contingencies accrual related to lawsuits or allegations brought against the Company. |