A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients toward more expensive medications while restricting their pharmacy choices. The report, which was reviewed by the Wall Street Journal, is the result of a 32-month investigation ahead of a hearing featuring executives from leading PBMs.
PBMs serve as intermediaries between health insurers and pharmaceutical companies, negotiating prices for medications and determining patients’ out-of-pocket expenses. The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control approximately 80% of prescription drugs.
The committee’s findings indicate that PBMs have established preferred drug lists that tend to favor high-priced brand-name drugs over more cost-effective options. For instance, the report highlighted internal communications from Cigna that advised against utilizing cheaper alternatives to Humira, a treatment for arthritis that had an annual cost of $90,000, despite having a biosimilar available at half the price.
Moreover, investigators found that Express Scripts informed patients they would pay more for prescriptions at local pharmacies compared to obtaining a three-month supply from its affiliated mail-order service, which restricted patients’ pharmacy selection.
Adding to these concerns, the Federal Trade Commission (FTC) released a similar report earlier this month, indicating that increased consolidation among PBMs has allowed the six largest managers to handle nearly 95% of all U.S. prescriptions. The FTC’s findings underscore the significant influence these PBMs have over Americans’ access to affordable medications, suggesting that their practices create conflicts of interest and could lead to elevated prescription drug costs.
FTC Chair Lina M. Khan emphasized that the reports indicate PBMs are overcharging patients for cancer treatments, generating more than $1 billion in additional revenue.