A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards higher-cost medications while restricting their options for obtaining them.
The report indicates that Medicare patients could potentially save $1.5 billion on ten specific prescription drugs. This finding comes after a 32-month investigation by the committee, which preceded a hearing featuring executives from the largest PBM firms in the country.
PBMs act as intermediaries for health insurers, negotiating pricing with pharmaceutical companies and determining the out-of-pocket costs patients face. The three largest PBMs in the U.S.—Express Scripts, OptumRx from UnitedHealth Group, and CVS Health’s Caremark—manage around 80% of all prescriptions.
According to the report, PBMs have established preferred drug lists that favor more expensive brand-name drugs over their more affordable counterparts. Notably, emails from Cigna indicated a discouragement of cheaper alternatives to Humira, a drug priced at $90,000 annually, despite the availability of a biosimilar priced at half that amount.
The committee’s findings also highlighted that Express Scripts informed patients they would incur higher costs by filling prescriptions at their local pharmacies compared to obtaining a three-month supply from their associated mail-order service, thus limiting patients’ pharmacy choices.
A separate report from the Federal Trade Commission (FTC) earlier this month echoed similar concerns. The FTC discovered that the six largest PBMs are responsible for managing nearly 95% of prescriptions filled in the U.S., raising apprehensions about their power over patient access and affordability of medications.
The FTC further stated that this concentration could lead to conflicts of interest, as vertically integrated PBMs may favor their own affiliated operations, disadvantaging independent pharmacies and driving up drug costs. FTC Chair Lina M. Khan emphasized that these findings suggest that PBMs are overcharging patients for cancer medications, resulting in increased revenues exceeding $1 billion.