Pharmacy benefit managers have become some of the most powerful, and controversial, players in healthcare.
PBMs face growing scrutiny from federal and state lawmakers, health systems and physicians who say the middlemen add costs and restrict care access.
Here are 10 things physicians need to know:
1. As of 2024, three PBMs control 80% of the market, according to a report from the Drug Channels Institute:
- Cigna’s Express Scripts: 30%
- CVS Caremark: 27%
- Optum Rx (UnitedHealth): 23%
2. The House Committee on Oversight and Government Reform expanded its PBM probe in August 2024 to include Optum Rx and Cigna Group. Lawmakers are scrutinizing the use of foreign-based group purchasing organizations, which may help PBMs sidestep U.S. regulations. Chair Rep. James Comer has accused executives from major PBMs of making false statements during hearings on anticompetitive practices.
3. The Pharmaceutical Care Management Association, the PBMs’ lobbying arm, has proposed changes to stave off potential regulation from the Trump administration,according to a document obtained by Bloomberg. Draft proposals include:
- Preventing patients from paying more than the cash price at pharmacies
- Expanding the use of cheaper biologic alternatives
- Increasing payments to rural and independent pharmacies
4. A 2024 congressional report found PBMs often steer patients toward higher-cost drugs and affiliated mail-order pharmacies. Express Scripts, for example, told patients it would be cheaper to use its mail-order service rather than a local pharmacy.
5. States have passed new laws curbing PBM power:
- Arkansas will ban PBMs from owning or operating pharmacies starting in 2026.
- Iowa now restricts PBM cost-sharing and requires reimbursement based on drug price averages.
- Illinois mandates that PBMs pass rebates to insurers, bans steering and imposes up to $25 million in annual fees.
6. In July, the U.S. Supreme Court declined to review Oklahoma’s PBM law, which the 10th Circuit struck down for conflicting with federal statutes. Despite backing from 30+ states, the ruling casts doubt on similar laws in Iowa, Minnesota, Arkansas and Tennessee.
7. OptumRx, CVS Health, Express Scripts and Prime Therapeutics controlled about 67% of rebate negotiations in 2023, a key driver of drug prices, a report from the American Medical Association. These same companies lead across retail network management and claims processing. By 2023, 77% of prescription drug plan enrollees, and 88% of Medicare Part D enrollees, were covered by vertically integrated PBM-insurer entities, the AMA found.
8. Many physicians cite PBM policies as a major obstacle. Christopher Magiera, MD, gastroenterologist in Oshkosh, Wis., told Becker’s that the biggest disruptor to his practice is “rampant medication prior authorization denials from the PBMs employed by both commercial and governmental insurance companies/entities.”
9. An emerging strategy for health systems has been to bring PBMs in house. Salt Lake City-based Intermountain Health, through its insurance arm Select Health, rebranded its PBM to Scripius to gain greater control over prescription costs, enhance transparency and eliminate inefficiencies. Chapel Hill, N.C.-based UNC Health also launched its own PBM platform, offering a transparent model for drug cost management, claiming up to 32% of savings on annual prescription drug costs.
10. Meanwhile, Mark Cuban’s Cost Plus Drugs aims to challenge PBMs with a transparent, cost-based model. The company prices 100 medications by a manufacturing fee, a 15% markup along with a shipping and handling fee. At the 2025 HLTH conference in Las Vegas, Mr. Cuban elaborated on his plans to collaborate with TrumpRx, a forthcoming federal drug discount platform launching in 2026.
