Understanding Gen Z: A Comprehensive Look at America’s Youngest Adults. Download

Report: Understanding Gen Z. Download

Opinion

Unchecked Health Care Mergers Threaten Seniors’ Access to Prescription Drugs

Pharmacy benefit managers are the latest industry group set to appear before the Senate Finance Committee to detail their role in the drug pricing supply chain and offer ideas to lower prescription drug prices. As senators evaluate their testimony, however, they should keep in mind one troubling statistic that towers above all: The five largest health care conglomerates combining pharmacy benefits and health insurance are on track in 2019 to become bigger than America’s five pre-eminent tech companies. For the committee, this astounding fact is more than a cause for concern — it’s a cause for oversight.

According to Axios, Anthem Inc., Cigna Corp., CVS Health Corp., Humana Inc. and UnitedHealth Group Inc. expect to collect almost $787 billion in 2019 — compared with $783 billion projected revenue for Facebook Inc., Amazon.com Inc., Apple Inc., Netflix Inc. and Google. Further, these unchecked conglomerates will control pharmacy benefits and health insurance coverage for more than 125 million Americans. Examining these basic facts alone — and how this all came about so swiftly — could fill several hearings, not just one.

Chairman Charles Grassley (R-Iowa), ranking member Ron Wyden (D-Ore.) and their colleagues should conduct a thorough examination of the impact market concentration and cross-market integration has had in restricting seniors’ access to prescription drugs, particularly the most frail and vulnerable seniors. The sheer scale and scope of the mergers — and the speed with which they occurred — should incentivize Congress to more carefully analyze how rapid, colossal consolidation along the prescription drug supply chain has and continues to reduce consumer choice and market competition, not enhance it.

Seniors in skilled nursing and assisted living facilities — where long-term care pharmacy clinical and medication management services can help make a measurable difference in quality outcomes — have every reason to be concerned with how these modern-day oligopolies place shareholders’ interests above the needs of their patients.

Long-term care pharmacies, a distinct subset within the pharmacy community, serve a specialized population of seniors in skilled nursing centers, assisted living facilities and other residential care settings. The typical patient served suffers from multiple chronic conditions, significant impairments in daily living activities, mild to moderate dementia, and takes an average of 12-13 prescription medications daily – making drug prices and access to needed medications an essential variable in maintaining vulnerable seniors’ health and well-being.

Further, more than 60 percent of hospital readmissions from nursing centers involve medication issues. Effective oversight and ready access to medications as part of a patient’s clinical care are important factors for reducing hospital readmissions and associated costs.

While these mergers are premised upon a legitimate free market motive, let’s be real: This unprecedented merger and acquisition activity, rapid vertical and horizontal integration, and pharmacy benefit managers’ stubborn adherence to non-transparent business practices threaten the nation’s commitment to free and fair markets. This ultimately reduces patient access, raises costs and places non-affiliated long-term care pharmacies at an exploitative competitive disadvantage.

We are already justifiably concerned that three market-dominant players – CVS Health, Express Scripts and United Health care – own the three market-dominant pharmacy benefit managers and market-dominant chain pharmacies in the retail, mail order, specialty and LTC markets – and that their three pharmacy benefit managers already control more than 90 percent of prescriptions dispensed to seniors in the nation’s long-term care facilities.

The onus is on the conglomerates to detail with facts and data how they intend to ensure elderly prescription drug consumers and the independent long-term care pharmacy specialists who serve them, are somehow better off than they were before this unchecked and largely unnoticed merger binge occurred. Count us as skeptical.

 

Alan G. Rosenbloom is president and CEO of the Senior Care Pharmacy Coalition, the only national organization exclusively representing the interests of long-term care pharmacies.

Morning Consult welcomes op-ed submissions on policy, politics and business strategy in our coverage areas. Updated submission guidelines can be found here.