PBMs Facing Lawsuit from Independent Pharmacies over Excessive Fees 

By Consumers for Quality Care, on January 17, 2024

PBMs Facing Lawsuit from Independent Pharmacies over Excessive Fees 

UnitedHealth and OptumRx, its pharmacy benefit manager (PBM), are being sued over alleged anticompetitive practices, according to reports by Healthcare Dive.   

The lawsuit seeks to address performance-based fees, known as DIR or direct remuneration fees, implemented by PBMs on independent pharmacies. PBMs set these fees based on how well an independent pharmacy performs. Independent pharmacies argue that these metrics, such as patient outcome, are outside of their control.

National Community Pharmacists Association CEO Douglas Hoey applauded the lawsuit, calling PBMs “21st century robber barons” in a statement.

Independent pharmacies feel obligated to accept these high fees, often dispensing medicine at a loss in order to avoid losing access to a PBM’s network and their large consumer base. Three of the largest PBMs – OptumRx, CVS Caremark and Cigna’s Express Scripts – control 80 percent of drug prescriptions in the country, and all impose DIR fees on independent pharmacies, which have risen substantially in a short amount of time. From 2020 to 2021, DIR fees increased by 33 percent. The high fees imposed by PBMs have contributed to the closure of many independent pharmacies in rural areas. Now, nearly half of the counties in the United States are deemed pharmacy deserts, or communities where consumers must drive 15 minutes or more to reach a pharmacy.  

This lawsuit comes as PBMs face increased scrutiny from Congress, the Centers for Medicare and Medicaid Services (CMS), and consumer advocate agencies over their business practices. Just last month, CMS sent a letter to health plans and PBMs, calling on them to re-examine how they currently reimburse pharmacies. Congress has advanced bipartisan legislation aimed at curbing the power of PBMs, calling for more transparency within the industry.

CQC urges lawmakers and regulators to continue scrutinizing PBM practices, especially those that reduce competition or increase the cost of prescription medications for consumers.