Davis: PBMs’ power over patients, pocketbooks unchecked

Whether you rely on private health insurance or taxpayer-funded programs such as Medicare, your family's trip to the pharmacy for prescription medicines has undoubtedly become more expensive over the years.

What drives that rising cost? Shadowy middlemen known as pharmacy benefit managers (PBMs).

Our broken healthcare system allows these middlemen to exert undue influence over drug pricing. This power wielded by PBMs has resulted in unjustifiable increases in prescription drug costs, burdening patients already grappling with challenges in accessing essential medications.

Consider, for instance, UnitedHealth Group. This mega-corporation has made headlines for a recent cyberattack that compromised its patient data. This incident is now the subject of a federal investigation and potential congressional hearings. Any such congressional hearing would also be an opportunity to assess UHG's and the larger PBM industry's control of drug pricing — and the impact on patients.

UHG is a multi-faceted corporation with business units ranging from a PBM to pharmacies and from primary care centers to a health technology company. With $370 billion in revenues last year alone, UHG has grown so big that it owns its own FDIC-insured bank to pay medical providers waiting on pending insurance claims.

UHG is one of six dominant players that hold a disproportionate market share of our nation's healthcare system. Consolidations, mergers and acquisitions have created a monopoly-like environment that wields too much power over Medicare, Medicaid and privately insured patients.

These corporations are some of the nation's largest and most profitable, and they use their market domination to negotiate large rebates or discounts from drug manufacturers — savings that are supposed to be intended for patients. UHG's PBM, along with two others — Cigna's Express Scripts and CVS/Aetna's Caremark — determine the prices patients pay for about 80 percent of prescription drugs sold in our country.

While these PBMs claim to lower out-of-pocket costs by passing these savings on to patients, the reality is quite the opposite. PBMs retain these funds for their own benefit and with little transparency, while patients' costs continue to increase.

And yet, PBMs appear to be largely immune from legislative and regulatory oversight. Where is the accountability? It's time for Congress to step in, and as a ranking member of the U.S. Senate, I hope our own Sen. John Cornyn will help by leading this important charge.

Without a doubt, PBMs should be held accountable. Their influence should not impede the affordability and accessibility of vital medications that are sometimes necessary to keep patients such as my own child alive.

Congress must take decisive action and enact substantive PBM reform now. For starters, to foster transparency and fairness, it is time to "de-link" the price of medicines from PBM revenues. This would allow PBMs to be paid a flat fee for their services, allowing patients to benefit from the savings negotiated with drug manufacturers as intended.

There's much work to be done. Cornyn and his colleagues in Congress must hold UHG and their PBM counterparts accountable for past actions and present practices.

We need to encourage a fair pharmaceutical pricing system that prioritizes patients' well-being over PBMs' self-interests and profits.