A new report by the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications and restricting their options for where to fill prescriptions. This report follows a 32-month investigation by the committee and precedes a hearing involving executives from the largest PBMs in the nation.
PBMs act as third-party administrators of prescription drug plans for health insurers, negotiating prices with pharmaceutical companies on behalf of health plans and determining out-of-pocket costs for patients. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control about 80% of prescriptions in the U.S.
The report indicates that these managers have established preferred drug lists that favor pricier brand-name medications over more affordable alternatives. For instance, the report references internal communications at Cigna, which dissuaded staff from promoting cheaper alternatives to Humira, a medication for arthritis and other autoimmune disorders that costs around $90,000 annually, while similar biosimilars are available for about half that price.
Furthermore, the committee noted that Express Scripts informed patients they would pay more to fill prescriptions at their local pharmacies compared to getting a three-month supply from their affiliated mail-order service. This policy effectively limits patient choice regarding pharmacy selection.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, stating that the increasing consolidation and vertical integration in the industry allows six major PBMs to oversee nearly 95% of all filled prescriptions in the country. The FTC expressed concern about the significant influence these PBMs wield over Americans’ access to affordable medications.
FTC Chair Lina M. Khan highlighted that these middlemen are potentially “overcharging patients for cancer drugs,” leading to an additional revenue gain of over $1 billion.