A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications while restricting their pharmacy options. This finding follows a comprehensive 32-month investigation and is being discussed as the committee prepares for a hearing with executives from the largest PBMs in the nation.
PBMs serve as intermediaries, managing prescription drug plans for health insurers. Their responsibilities include negotiating prices with pharmaceutical companies and determining the out-of-pocket costs that patients must bear. Currently, the three largest PBMs—Express Scripts, OptumRx from UnitedHealth Group, and Caremark from CVS Health—manage around 80% of prescriptions in the United States.
The committee’s report highlights that these PBMs have established lists of preferred drugs that tend to favor higher-priced brand-name medications over more affordable alternatives. For instance, internal communications from Cigna reportedly discouraged the use of lower-cost alternatives to Humira, an arthritis treatment costing $90,000 annually, despite the availability of a biosimilar at half that price.
Additionally, Express Scripts informed patients that filling a prescription at their local pharmacy would result in higher costs than obtaining a three-month supply through their affiliated mail-order pharmacy, thereby limiting patient choice in selecting pharmacies.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report indicating that increasing consolidation in the PBM industry allows the six largest PBMs to oversee nearly 95% of prescriptions dispensed across the nation. The FTC expressed concern over the significant influence these leading PBMs wield over Americans’ access to affordable prescription medications. The report warns that vertically integrated PBMs may prioritize their own businesses over unaffiliated pharmacies, leading to conflicts of interest and increased prescription prices.
FTC Chair Lina M. Khan emphasized that these findings indicate that PBMs are “overcharging patients for cancer drugs,” generating an estimated additional revenue of over $1 billion.