The following content is sponsored by Americans for Limited Government.
Three companies decide what Americans pay for prescription drugs. Pharmacy Benefit Manager (PBM) companies like Express Scripts, CVS Caremark, and UnitedHealth’s OptumRx control roughly 80 percent the prescriptions filled in this country. These PBMs are middlemen who sit between your doctor and your pharmacist and skim a “rebate” from every transaction, coordinate behind the scenes to steer employers to higher-priced plans, and use overseas shell corporations to avoid scrutiny from American consumers and media (and the IRS).
The Federal Trade Commission (FTC) sued all three companies for harming vulnerable patients by artificially driving up drug prices.
Back in February, Express Scripts finally settled with the Trump FTC. They agreed to follow more standard and transparent policies. For example, they must base patient costs on the actual drug price; they must disclose payments to consultants who are steering employers to higher-priced plans; and they must provide data so sponsors can see what members are actually being charged. FTC officials estimate that this will drive down patient costs by $7 Billion – money that was being siphoned away from diabetics, seniors, and working families to line the pockets of PBM executives.
Express Scripts also agreed to reshore their overseas purchasing organization, which PBMs have used to avoid tax liability for their rebate schemes. The Trump FTC says this will bring $750 billion of economic activity back to the U.S., instead of bouncing to foreign shell companies.
The other two PBMs are stalling. CVS Caremark moved on March 23 to pause its case for “settlement discussions.” OptumRx got another stay extension on April 13. They are calculating whether they can outlast the FTC. They are hoping the news cycle moves on before the hammer falls.
The FTC must not move on. CVS Caremark and OptumRx run the same schemes as Express Scripts. They use the same inflated-rebate model, the same steering practices, the same offshore shell game. FTC Chairman Andrew Ferguson knows this. The day after the settlement, he stood up an agency-wide Healthcare Task Force aimed squarely at the “higher prices, decreased quality, less access and transparency, and stifled innovation” caused by consolidation in healthcare markets. In May, FTC Consumer Protection director Chris Mufarrige called out the PBM schemes like those run by Express Scripts for endangering both consumer protection and competition.
But even as the shocking nature of the PBMs’ unfair and deceptive practices are brought to light, and despite growing awareness of the shocking harm they are inflicting on the most vulnerable Americans, CVS Caremark and OptumRX continue to hold out for a better deal.
President Trump promised to lower drug prices for the forgotten Americans. His FTC is doing the work along with other departments like the Department of Labor (DOL) to advance PBM regulations that help American employers. These are great steps in the right direction and need to continue. Americans need greater accountability and transparency into their insurance benefits, we need an end to kickbacks that drive up costs for consumers, and we need to close down foreign shadow corporations whose sole purpose is to avoid American laws. It’s time for the FTC to drop the hammer on companies like CVS and OptumRx, and for Congress to prioritize PBM reform in 2026.
Read the full article here