NCPA Urges DOGE to Examine PBMs for Waste, Fraud, and Abuse

ALEXANDRIA, Va. (April 25, 2025) – The National Community Pharmacists Association is urging the Department of Government Efficiency (DOGE) to focus on pharmacy benefit managers as a major source of waste, fraud, and abuse.

“The increasing dominance of PBMs poses a significant threat to consumers’ convenient access to prescription medications and pharmacy services, while at the same time charging taxpayers excessively and draining limited health care resources in public health programs like Medicare Part D, Medicaid, Tricare, and the Federal Employees Health Benefit Plan (FEHBP),” said NCPA CEO B. Douglas Hoey in a letter to Rachel Riley, senior adviser for the U.S. Department of Health and Human Services.

CVS Health’s Caremark, Cigna’s Express Scripts, and UnitedHealthcare’s OptumRx control 80 percent of all prescriptions in the United States. They use their market dominance to crowd out smaller competitors, steer patients to their own pharmacies, and use the threat of higher premiums for seniors to squeeze more and more subsidies from Medicare and other government insurance programs.

“PBMs’ anticompetitive practices, opaque reimbursement models, and restrictive contract terms have created an environment in which they can use their overwhelming market power to steer patients away from their competitors to their own pharmacies and pay themselves higher prescription reimbursement rates,” said Hoey. “Shockingly, these insurer-PBMs received billions of dollars in bailout subsidies from the federal government to keep premiums stable in Medicare Part D.

“This wasteful use of taxpayer dollars is one in which DOGE should have a particularly strong interest,” he continued. “The PBMs essentially hold states and the federal government hostage by threatening to jack up premiums if they are required to behave fairly or openly. Indeed, they’ve spent tremendous sums of money fighting against any legislation that would require more transparency, let alone changes to their business model. And of course they would, because they are perhaps the only businesses in the world with the power to set prices for their smaller competitors and tell their competitors’ customers where to shop.”

The letter comes as Congress is considering whether to include PBM reforms in differing spending bills that have passed both houses and must now be reconciled.

Hoey said DOGE should work with the Centers for Medicare & Medicaid Services to eliminate or significantly tighten up the Medicare Drug Price Negotiation Program.

“We are concerned that pharmacies will have to float the program to the tune of roughly $11,000 per independent pharmacy per week; that pharmacies will not be paid fairly by PBMs; and that manufacturer refund payments to pharmacies will be delayed. A recent study found that pharmacies could forfeit an average of $43,000 in annual revenue due to underpayments — roughly equivalent to a pharmacy technician’s yearly salary.”

Hoey cited reports by the Federal Trade Commission and the House Oversight Committee exposing numerous examples of anticompetitive practices that lead to higher drug costs, fewer options for patients, and less competition in the retail pharmacy sector. He also pointed out that President Trump on several occasions called out PBMs as bad actors, and that curbing their influence would be part of his plan for lower drug costs.

“We are optimistic that Congress will act soon to pass comprehensive PBM reform legislation, but we believe there is more that the agencies can do to address PBM abuses that put a strain on taxpayer-funded health insurance programs,” he said.

Click here to read the full letter.

Founded in 1898, the National Community Pharmacists Association is the voice for the community pharmacist, representing over 18,900 pharmacies that employ more than 205,000 individuals nationwide. Community pharmacies are rooted in the communities where they are located and are among America's most accessible health care providers. To learn more, visit www.ncpa.org.