PBM Integration Impact.pdf

- PBM Mergers: The Justice Department's approval of mergers between Express Scripts-Cigna and CVS-Aetna marked the end of large, standalone pharmacy benefit managers (PBMs). However, these mergers did not address growing concerns about PBMs' lack of transparency from employers, pharmacists, consumer advocates, and legislators.
- Impact of Vertical Integration: The integration of PBMs with health insurers may take years to complete and could lead to increased transparency, according to Benjamin Isgur of PricewaterhouseCoopers. However, PBM critics argue that the merged entities have little motivation to voluntarily reduce revenues.
- HSAs and On-Site Clinics: High-deductible health plans paired with health savings accounts (HSAs) may hinder employers' ability to offer free primary care visits at on-site clinics due to IRS rules. Legislation is pending in Congress to address this issue.
- Optimism vs. Pessimism: Isgur believes the merged entities may become more transparent due to pressure from businesses and consumers, as well as the integration of medical and pharmaceutical treatment views. However, PBM critics like David Henka and Linda Cahn are pessimistic, expecting worse conduct from the merged entities due to increased market control.