Pharmacy benefit managers (PBMs) are directing patients toward more expensive medications while limiting their options for obtaining those drugs, according to a recent report from the House Committee on Oversight and Accountability.
The findings suggest that Medicare patients could collectively save $1.5 billion on ten specific prescription drugs. This report, which has been reviewed by the Wall Street Journal, comes as a result of a 32-month investigation ahead of a hearing involving executives from some of the largest PBMs in the country.
PBMs serve as intermediaries for prescription drug plans managed by health insurers, negotiating costs with pharmaceutical companies and determining the out-of-pocket expenses patients face.
The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—together manage approximately 80% of prescriptions.
The report indicates that these PBMs maintain lists of preferred medications that favor higher-priced brand-name drugs over cheaper alternatives. For instance, internal communications from Cigna were cited, which discouraged the use of lower-cost alternatives to Humira, a drug that costs around $90,000 annually, even though a biosimilar was available at half that price.
Additionally, the committee discovered that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through its affiliated mail-order service. This practice effectively restricted patients’ choice of pharmacy.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, highlighting that increased consolidation among PBMs has led to the largest six managing nearly 95% of all prescriptions in the country.
The FTC’s findings are concerning, stating that leading PBMs hold considerable influence over Americans’ access to and affordability of prescription drugs. It noted that the current system allows vertically integrated PBMs to potentially favor their own affiliated businesses, resulting in conflicts of interest that may harm unaffiliated pharmacies and drive up drug prices.
FTC Chair Lina M. Khan emphasized that these middlemen are effectively “overcharging patients for cancer drugs,” generating additional revenue exceeding $1 billion.