Weill Cornell Medicine researchers have found that pharmacy benefit managers (PBMs)—organizations that negotiate access to medicines for most patients in the United States—steer patients to use their own pharmacies. However, these pharmacies appear less used in Medicare than in other market segments. These PBMs are part of integrated health care conglomerates that own insurance companies and pharmacies, which may create conflicts of interest.
The study, published Jan. 10 in JAMA Health Forum, found that in 2021 a third of all Medicare Part D pharmacy spending and almost 40% of specialty drug spending within Medicare Part D was through pharmacies owned by the four largest PBMs: CVS, UnitedHealth Group, Cigna or Humana. However, this represents a far lower market share in Medicare than the nearly two-thirds national market share noted by a Federal Trade Commission's 2024 report . The findings may help guide future policy decisions on how these entities are regulated.
"It is striking that, on average, these companies have significantly lower market share in Medicare than the national estimates suggest," said the study's lead author Dr. Pragya Kakani , an assistant professor of population health sciences at Weill Cornell Medicine. "For high-cost specialty drugs, these pharmacies have almost half the market share in Medicare which is still lower than that observed across all other payer segments nationally."
Dr. Kakani believes one reason for the reduced market share of these pharmacies in Medicare could be due to the Center for Medicare and Medicaid Services' "any willing pharmacy" rules that ensure patients have access to their prescriptions at any pharmacy willing to meet the conditions set by Medicare Part D.
"While we don't test this directly, our work raises the possibility that these rules may be powerful in preventing PBM firms from getting huge market share," she said. Outside of Medicare Part D, insurers generally have more leeway to exclude certain pharmacies from their networks, meaning patients have fewer choices about where they can pick up their prescriptions.
"However, despite Medicare's 'any willing pharmacy' rules, insurers integrated with PBMs are still capable of steering a substantial portion of their Medicare Part D plan enrollees to their own pharmacies," noted senior author on the study Dr. Amelia Bond , associate professor of population health sciences at Weill Cornell Medicine. This is especially true among some high-cost specialty drugs. On average, Medicare patients used their own PBM's pharmacies at nearly 20 percent higher rates than what would be expected without steering.
For example, for pulmonary arterial hypertension, idiopathic pulmonary fibrosis and multiple sclerosis, PBM-owned pharmacies captured over 60% market share in Medicare. "Because there is a lot of variation by disease area in terms of the prevalence of these pharmacies, policymakers concerned about this issue should pay special attention to drug classes where these PBM-owned pharmacies are most used."
The market power of PBM pharmacies and firms' ability to steer patients to their own pharmacies may impact costs, access to independent pharmacies and patient experience. Thus, some states may consider expanding protections like "any willing pharmacy" in general commercial markets.
"Steering can amplify the potential harms as well as possibly potential benefits of this type of integration, justifying further research in this area," Dr. Kakani said. Dr. Kakani, Dr. Bond, and their research team will continue examining some of these issues, focusing on the quality of care PBM-owned pharmacies provide, including access, timely filling of prescriptions, patient adherence to treatment plans and pricing.
