As Congress has made changes to the health care system over the past 30 years, nothing has impacted consumers' lives as much as the growth of pharmacy benefit managers (PBMs).
The top three PBMs -- Express Scripts, CVS Caremark, and OptumRx -- control more than 70% of the marketplace. Express Scripts is owned by Cigna, CVS Caremark is owned by CVS Health (which owns Aetna), and OptumRx is owned by UnitedHealth Group (which owns UnitedHealthcare).
When Congress created the Medicare prescription drug benefit -- aka Medicare Part D -- and specified that it must be managed by private-sector prescription drug insurance providers, the doors of opportunity swung open even wider for PBMs.
So did the bank vaults. In 2020, OptumRx reported annual revenue of close to $87 billion by handling more than a billion prescriptions; full-year revenue at Evernorth, Express Script’s parent company, was reportedly over $116 billion. Walmart likes what it sees so much that it has also decided to join up with a PBM to enhance its prescription business.
PBMs play a large role in consumers’ lives
Most consumers might not think that PBMs play a large role in their lives, but they do. A staggering 266 million Americans (about 81% of the total population) are connected to PBMs in one way or another -- either through commercial health plans, self-insured employer plans, union plans, Medicare Part D plans, the Federal Employees Health Benefits Program, state government employee plans, or managed Medicaid plans.
In many ways, PBMs can have a positive impact on consumers because they have the power to control prescription drug prices so that they are more affordable. However, many lawsuits have claimed that these companies have shown a “reckless disregard” for the rights of their members.
In 2018, PBS produced an in-depth exposé on the practice of overcharging for prescriptions. It highlighted a University of Southern California study showing that the amount consumers co-pay for their drugs is above the rates reimbursed to pharmacies 25% of the time. The researchers said that produced an estimated $135 million in extra revenue for PBMs.
PBM complaints spike higher
Consumer sentiment towards PBMs has historically been positive. In the past, CVS Caremark, Express Scripts, and OptumRx have generated some positive reviews at ConsumerAffairs. But reviews submitted between March 1, 2021, and June 1, 2021, show that complaints about PBMs have shot through the roof.
| PBM | 1-star | 2-star | 3-star | 4-star | 5-star |
| CVS Caremark | 90.9% | 9.1% | - | - | - |
| Express Scripts | 90.3% | 2.9% | 2.9% | - | 2.9% |
| OptumRx | 100% | - | - | - | - |
(*The star ratings are calculated from verified ConsumerAffairs reviews submitted about CVS Caremark, Express Scripts, and OptumRx from March 1, 2021, through June 1, 2021.)
Customers posting reviews at ConsumerAffairs found a lot to complain about with the big three PBMs. The majority of the complaints fell under the following categories:
Customer service issues: inquiries unanswered, passed on to another support representative, etc.
Fulfillment issues: Customers not getting their medications on time, wrong medications sent, etc.
Billing issues: Prices being changed without the customer’s knowledge, credit cards being billed without permission, etc.
Authorization issues: PBMs speaking to the wrong person at a physician’s office, for example.
What are consumers saying?
ConsumerAffairs users were more than happy to share their experiences when writing reviews about the various PBMs they’ve dealt with. One account from Robert in New Jersey showed just how the customer service experience can turn on a dime.
“OptumRx used to be one of the best customer service to deal with. They are now one of the worst. I spent 2 hours today trying to get an order thru, spoke with at least 5 reps. who kept transferring me back and forth with long hold times on each transfer. The reps do not know the product or how to deal with any issues,” he said.
Another reviewer named Michael shared how frustrated he became with Express Scripts when it came to authorizations for his medications.
“This company solely exists to take your money. They will take your healthcare/insurance money willingly, but then turn around and refuse to fill your prescriptions because of their own internal guidelines. They make it next to impossible to get information about how to proceed with getting their decisions overturned. They will require prior authorization for your medication but won't tell you about it for days after your prescription gets rejected,” he said.
When ConsumerAffairs followed up with Michael to see if his issues had been resolved, he credited his doctor for getting him the help he needed.
“The issues are resolved only because my doctor is a champion and worked through all the red tape. The review stands as written: they're a horrible company,” he said.
Why are things getting worse?
While the stories shared by Michael and Robert only represent two interactions with PBMs, reviews submitted by plenty of other ConsumerAffairs show that consumers are facing a lot of problems when it comes to these companies. The question is, why do things appear to be getting worse?
When we put that question to Jesse Dresser, who heads up the law firm Frier Levitt’s Pharmacy Practice Group, he said many consumers don’t feel any kind of connection to their PBM. He said they also feel helpless when it comes to their prescriptions.
“In the pharmacy benefits industry, consumers (who are patients) are often two, sometimes three steps removed from their PBMs. They don’t choose their PBMs and often don’t even fully know who their PBMs are or what roles they play,” he told ConsumerAffairs.
To complicate matters even further, PBMs have an immense amount of control over the pharmaceutical care that patients receive.
“Because the PBMs have this captive consumer group that cannot easily ‘switch’ to a competitor, they do not need to invest in customer service as it relates to the patients. Since most people receive their pharmacy benefits as part of their insurance, which is typically selected by their employer, the PBMs focus on maintaining relationships with benefits brokers, not patients,” Dresser said.
Michael Arrigo, an expert with knowledge of how formularies and PBMs impact drug insurance reimbursement, cited data suggesting that another primary driver of dissatisfaction among consumers in recent years comes from formulary drug exclusions.
Formulary exclusions — a decision by a PBM not to include a drug on its list of covered drugs — have exploded over the last seven years. According to Managed Healthcare Executive, CVS Caremark and Express Scripts excluded a relative handful of medications in 2014 — 134 between them. By 2020, the big three excluded a combined 1,195 medications.
“As a result, impacted patients with commercial insurance may not access the medication prescribed by their doctor,” Arrigo told ConsumerAffairs.
In response to these claims, PBMs have stated that cutting the number of covered drugs gives them more bargaining power and leads to better prices. As an example, Express Scripts said that between 2014-2020, its formulary exclusions saved clients and patients $14.5 billion.
Not many options, but hope still remains
As Dresser pointed out, some users feel "forced" to use specific PBMs and feel like they have no say in the matter. But is there any way to get around the issues consumers face with PBMs?
“No, not really,” Dr. Joshua P. Cohen, an independent health care analyst and former Research Associate Professor at the Tufts University Center for the Study of Drug Development, told ConsumerAffairs.
“Unless end-users have choices when they select a health plan, there's little they can do. In some instances it does pay for end-users NOT to use their PBM or health plan insurance card, as the co-payment for their generic drug is actually HIGHER than the retail price at the pharmacy.”
While the picture Cohen paints is bleak, consumers should still hold on to some hope. Just this week, health care insurer Centene paid the states of Mississippi and Ohio $143 million to settle PBM disputes and said it now has a better understanding of the value of transparency.
According to the National Conference of State Legislatures, many states are passing laws related to PBMs. In total, 207 bills across 47 states are in the works that would prohibit consumers from being hurt from practices like:
Patient steering: Requiring patients to go to only certain providers. Georgia, Louisiana, Minnesota, and Utah have passed legislation banning the practice.
Gag clauses: Restricting pharmacists from letting consumers know that there are lower-cost options like paying for a prescription out of pocket rather than using their insurance plan. Over two-thirds of states have laws that address this issue.
Monique M. Whitney, executive director of Pharmacists United for Truth and Transparency, suggests that patients who feel forced or steered should first check with their regular pharmacy.
“Often the pressure patients are feeling to switch pharmacies is really just pressure that comes from advertising propaganda designed to look like official communication,” she said. “However, in cases where steering is happening (‘You have to switch pharmacies or you will lose your benefits coverage’), patients should complain to their employers and then submit a complaint through their Department of Insurance and/or Attorney General's office.”