A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications while restricting their pharmacy options. This report, which follows a 32-month investigation, precedes a hearing involving executives from the leading PBMs in the nation.
PBMs act as third-party administrators for prescription drug plans under health insurers, negotiating prices with pharmaceutical companies, and determining patients’ out-of-pocket expenses. The three dominant PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage about 80% of U.S. prescriptions.
The committee’s findings highlight that PBMs have created preferred drug lists that tend to favor higher-priced brand-name medications over more affordable alternatives. An example cited in the report involves Cigna employees dissuading the use of cheaper options for Humira, a medication for arthritis and autoimmune diseases, which carried a hefty price tag of $90,000 annually, despite the availability of a biosimilar for half that cost.
Additionally, the committee discovered that Express Scripts informed patients that they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply from its affiliated mail-order service, effectively limiting patient choices.
The U.S. Federal Trade Commission (FTC) released a similar report earlier this month, indicating that the top six PBMs control nearly 95% of all prescriptions filled in the U.S. The FTC’s interim report raised concerns about the significant power that leading PBMs have over patients’ access to and affordability of prescription drugs, leading to conflicts of interest favoring their own businesses.
FTC Chair Lina M. Khan emphasized that these findings demonstrate how middlemen are overcharging patients for cancer medications, resulting in an additional revenue influx of over $1 billion for them.