Pharmacy Benefit Manager math: Big chains paid $23.55 to fill a blood pressure Rx. Small drugstores paid $1.51

Pharmacy Benefit Managers [PBMs] are the middlemen who manage virtually all prescriptions written in the U.S. Serving as brokers among drugmakers, pharmacies, and health insurers, these health care entities have drawn scrutiny from Congress, the Federal Trade Commission, and state legislatures for their role in the increase in drug prices.

Independent pharmacists say PBMs not only create higher costs but also make it harder for patients to access medications. PBMs are now the most common reason for patients having to go to multiple pharmacies in order to get prescriptions filled. An analysis by the American Pharmacy Cooperative, which represents independent pharmacies, showed that chains received an average of nearly $54 for the antidepressant bupropion, while, for example, Bell's Family Pharmacy in Tate, Georgia, got $5.54. For a drug used to treat blood pressure, amlodipine, chain pharmacies received an average of $23.55, while Bell's got $1.51.

Bell's Family Pharmacy closed earlier this year. By controlling prices and availability, PBMs cause patients and employers to spend more for medications, according to the Federal Trade Commission [FTC] and pharmacy groups. On Sept. 20, the FTC sued three of the largest PBMs - CVS Health's Caremark, Cigna's Express Scripts, and UnitedHealth Group's Optum Rx, which together control about 80% of U.S. prescription drug sales. The agency said they created a "perverse drug rebate system" that artificially inflates the price of insulin. Each company denied the allegations.

The lawsuit followed a scathing FTC report in July that said the "dominant PBMs can often exercise significant control over which drugs are available, at what price, and which pharmacies patients can use to access their prescribed medications."

The trade group that represents PBMs, the Pharmaceutical Care Management Association [PCMA], said the insulin market is working well and blamed drugmakers for historically higher prices of the medication.

Independent pharmacists, though, say they lose money filling certain prescriptions while reimbursements favor chain pharmacies like CVS that have corporate ties to PBMs. And even the chain pharmacies have retrenched, with CVS, Rite Aid, and Walgreens announcing layoffs or store closures in recent months.

PBMs will charge some health insurance plans more for a medication than what they reimburse a pharmacy, keeping the extra money as profit, critics say. This practice is known as "spread pricing." Large PBMs also take money from drugmakers as a "rebate" to give their drugs preferential treatment on health plans' lists of medications, independent pharmacies say. And by favoring certain pharmacies with whom they have business ties, experts say, these drug brokers help force independent stores to close.

Members of both parties in Congress have tackled PBM reform. House members recently introduced another proposal, known as the Pharmacists Fight Back Act, which supporters say would add transparency, limit costs for patients, ensure they get the benefit of drugmaker discounts, and protect their pharmacy choices.

The consolidation that has combined health insurers with PBMs - including their operating their own retail, mail-order, and specialty pharmacies - has created financial behemoths, said U.S. Rep. Buddy Carter, a Georgia Republican and a pharmacist. "I'm interested in busting them up," he said.

Alexander Oslimyansky, co-founder of Mark Cuban Cost Plus Drug Company, said the PBMs siphon off about a third of the $400 billion a year spent on pharmaceuticals.

"What we could do as a society with $100 billion as opposed to paying some companies to process drug payments," Oshmyansky said.

PCMA, the trade group, cited a report funded by the three biggest PBMs that said their operating margins are less than 5%. And the group says that discussions about congressional reform "reflect a one-sided view informed directly by the pharmaceutical industry's blame game designed to vilify PBMs to keep prescription drug prices high and increase drug company profits." Underpayments by PBMs, however, have accelerated the closures of mom-and-pop pharmacies across the country, said the National Community Pharmacists Association, which represents independent pharmacies. Excerpt published with permission from KFF Health News. Montana correspondent Katheryn Houghton and senior correspondent Arthur Allen contributed to this report.