A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more costly medication options while restricting their pharmacy choices. This report follows a 32-month investigation by the committee in anticipation of an upcoming hearing involving executives from the largest PBMs in the United States.
PBMs act as third-party administrators for prescription drug plans offered by health insurers. They negotiate drug prices with pharmaceutical companies and establish patients’ out-of-pocket expenses. Express Scripts, OptumRx from UnitedHealth Group, and CVS Health’s Caremark are the three largest PBMs, managing about 80% of prescriptions in the country.
The committee discovered that PBMs have developed preferred drug lists that often feature higher-priced brand-name drugs over more affordable alternatives. For instance, emails from Cigna employees mentioned discouraging the use of a cheaper alternative to Humira, a treatment for arthritis and other autoimmune disorders which costs around $90,000 annually, despite the existence of a biosimilar priced at half that amount.
Furthermore, the investigation found that Express Scripts informed patients they would pay more if they filled prescriptions at their local pharmacies rather than through its mail-order pharmacy, thereby limiting their choices.
A similar report released earlier this month by the U.S. Federal Trade Commission (FTC) highlighted that the largest six PBMs account for nearly 95% of all prescriptions filled in the U.S. The FTC expressed concern about the significant influence these PBMs hold over Americans’ access to affordable medications, suggesting that conflicts of interest arise when vertically integrated PBMs favor their own affiliated businesses, which can harm independent pharmacies and raise drug prices.
FTC Chair Lina M. Khan pointed out that these findings indicate that PBMs are potentially overcharging patients for cancer medications, generating over $1 billion in additional revenue.