Chuck Darwin<p>Health insurance companies are notorious for exploiting prior authorization schemes to avoid paying for care and have denied claims at alarming rates in recent years.</p><p>However, corporate consolidation of industry “middlemen” that experts say are partially to blame for the prescription drug affordability crisis has received less scrutiny from the general public, <br>despite efforts by lawmakers and the Federal Trade Commission (FTC) to shine light on the notoriously opaque and confusing corporate bureaucracy that determines the cost of medicine.</p><p>We often hear about Big Pharma selling drugs at high prices <br>and insurance companies dragging their feet when it comes time to pay the bill, <br>but the prices patients pay out of pocket for pharmaceuticals is largely shaped by the connective tissue between insurers and drug manufacturers: <a href="https://c.im/tags/pharmacy" class="mention hashtag" rel="nofollow noopener noreferrer" target="_blank">#<span>pharmacy</span></a> <a href="https://c.im/tags/benefit" class="mention hashtag" rel="nofollow noopener noreferrer" target="_blank">#<span>benefit</span></a> <a href="https://c.im/tags/managers" class="mention hashtag" rel="nofollow noopener noreferrer" target="_blank">#<span>managers</span></a>, or PBMs. </p><p>PBMs have been around for decades, but the largest PBMs have merged with major insurance companies to form conglomerates, <br>including UnitedHealth Group’s <a href="https://c.im/tags/OptumRx" class="mention hashtag" rel="nofollow noopener noreferrer" target="_blank">#<span>OptumRx</span></a>.</p><p>In theory, PBMs negotiate discounts and rebates paid by drug makers that are passed onto insurance companies and their patients, <br>but the lack of transparency in that process has long frustrated lawmakers and regulators attempting to contain the skyrocketing cost of medicine.</p><p>The PBMs say their secret negotiations with drug companies make prescriptions more affordable for consumers, <br>but this system has not shown to protect patients from sticker shock at the pharmacy counter.</p><p>Nearly 30 percent of Americans say they haven’t taken prescribed medication due to cost, <br>and an estimated 1.1 million Medicare patients alone could die over the next decade because they cannot afford the drugs prescribed by their doctors, <br>according to the American Hospital Association. </p><p>The FTC reports that in 2023, the U.S. spent more than $722 billion on prescription drugs, <br>💥nearly as much as the rest of the world combined.</p><p>Clearly the system is not working for patients or public health, <br>and policy makers in both parties have increasingly focused on the PBMs <br>and their recent mergers with major insurance companies. </p><p>According to a two-year FTC investigation on health care conglomerates released in July, <br>PBMs are “powerful middlemen inflating drug costs and squeezing Main Street pharmacies.”</p><p>“We’ve heard accounts of how the business practices of PBMs may deprive patients of access to the most affordable medicines <br>and how doctors find themselves having to subordinate their independent medical judgment to PBMs’ decision-making at the expense of patient health,” <br>FTC Chair Lina Khan said in a statement at the time.<br><a href="https://truthout.org/articles/its-not-just-denied-claims-insurance-firms-are-hiring-middlemen-to-deny-meds/" rel="nofollow noopener noreferrer" translate="no" target="_blank"><span class="invisible">https://</span><span class="ellipsis">truthout.org/articles/its-not-</span><span class="invisible">just-denied-claims-insurance-firms-are-hiring-middlemen-to-deny-meds/</span></a></p>