The House Oversight and Accountability Committee is taking a hard look at pharmacy benefit managers (PBMs).
Namely, Committee Chair James Comer (R-Ky.) launched an investigation into PBMs’ actions that harm patient care and increase costs for consumers. Comer has tasked officials at the Office of Personnel Management (OPM), Centers for Medicare and Medicaid Services (CMS), and the Defense Health Agency (DHA) with providing documents and communications that can determine the extent PBMs’ tactics impact healthcare programs administered by the federal government.
PBMs are considered the middle men, negotiating prices and payment processes, plus availability, between employers, labor unions and governments with pharmacies. They also negotiate rebates to customers with drug makers, and their businesses are critically opaque. Criticism from lawmakers and other stakeholders has even led one of the biggest PBMs, CVS Health’s Caremark, to change its policy to ensure 100% of price rebates go back to consumers.
CVS Caremark, along with Express Scripts and OptumRx, have been asked to provide documents, communications, and information related to their practices that are distorting the pharmaceutical market and limiting high quality care for patients.
“Pharmacy benefit managers’ anticompetitive tactics are driving up healthcare costs for Americans and harming patient care,” Comer said in a statement. “Federal agencies administering healthcare programs for seniors, active-duty military and federal employees rely on PBMs as middlemen to set drug prices, which opens the door to government waste at the expense of American taxpayers. Greater transparency in the PBM industry is vital to determine the impact that their tactics are having on patients, the pharmaceutical market and healthcare programs administered by the federal government.”
CVS Health’s CVS Caremark, Cigna’s Express Scripts and UnitedHealth Group’s Optum Rx represent roughly 80% of the PBM marketplace, and previous studies have revealed consolidation in the PBM market leads to higher costs for consumers and has negative impacts on patient health. In addition, consolidation has forced manufacturers to raise their prices and created conflicts of interest which distort the market and limit high quality care for patients, according to the committee.
In 2021, Mark Cuban jumped into the PBM space with his company, Cost Plus Drug Company, in an effort to offer lower-priced prescription drugs.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."