Pharmacy benefit managers (PBMs) are directing patients toward higher-cost medications and restricting their pharmacy options, according to a recent report released by the House Committee on Oversight and Accountability.
The report, examined by the Wall Street Journal, is the result of a 32-month investigation by the committee in anticipation of a hearing featuring executives from the country’s largest PBMs. These PBMs act as intermediaries for health insurance companies, managing prescription drug plans and negotiating prices with pharmaceutical manufacturers for medications, while also determining patients’ out-of-pocket costs.
The three largest PBMs in the U.S.—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—are responsible for managing around 80% of all prescriptions in the country.
The committee’s findings indicated that these PBMs have developed preferential drug lists that prioritize more expensive brand-name medications over less costly alternatives. One example highlighted was Cigna’s internal communications that suggested avoiding cheaper options for Humira, an arthritis treatment that at one point cost $90,000 annually, despite the availability of a biosimilar at half that price.
Moreover, the committee discovered that Express Scripts informed patients they would incur higher costs if they chose to fill prescriptions at their local pharmacies instead of utilizing their affiliated mail-order pharmacy for a three-month supply. This practice effectively restricted patients’ pharmacy choices.
A concurrent report from the U.S. Federal Trade Commission (FTC) reiterated these concerns, indicating that increasing consolidation has allowed the six largest PBMs to control nearly 95% of all U.S. prescriptions. The FTC reported that the influence of leading PBMs significantly impacts Americans’ access to affordable prescription medications. This system creates potential conflicts of interest, favoring PBMs’ affiliated businesses and driving up drug prices.
FTC Chair Lina M. Khan noted that these findings suggest that PBMs are overcharging patients for cancer medications, resulting in more than $1 billion in excess revenue for these intermediaries.