A new report from the House Committee on Oversight and Accountability highlights concerns that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications while restricting their choice of pharmacies. This report, seen by the Wall Street Journal, comes after a 32-month investigation and precedes a hearing involving leaders from the largest PBMs in the country.
PBMs, which serve as middlemen for prescription drug plans on behalf of health insurers, negotiate pricing with pharmaceutical companies and establish the out-of-pocket costs for patients. The three largest PBMs in the U.S. — Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark — collectively manage around 80% of prescriptions.
The report reveals that PBMs have created preferred drug lists that favor higher-priced brand-name drugs over more affordable alternatives. One example noted involves Cigna staff emails discouraging the use of less expensive options for Humira, a drug priced at $90,000 annually, while a biosimilar was available for about half that cost.
Additionally, the committee found that Express Scripts informed patients they would incur higher costs if they opted to fill prescriptions at local pharmacies, compared to using their affiliated mail-order pharmacy. This practice effectively restricts patient choices regarding where to obtain their medications.
Recently, the U.S. Federal Trade Commission (FTC) released a similar report, indicating that the six largest PBMs are now responsible for managing approximately 95% of all prescriptions filled in the country. The FTC report expressed concern over the significant power held by these leading PBMs, which may hinder access to affordable medications. The findings suggest that these PBMs have incentives to favor their own businesses, potentially disadvantaging independent pharmacies and raising drug prices.
FTC Chair Lina M. Khan remarked that the investigations reveal how these intermediaries are overcharging patients for cancer medications, generating over $1 billion in additional revenue.