Illinois patients, pharmacies struggle as PBMs drive up costs, limit access

At her feet was a package she hadn’t expected: a delivery containing her prescribed Stelara, a vital injection that keeps her psoriasis and psoriatic arthritis under control.

The medication is supposed to remain chilled between 35 and 46 degrees Fahrenheit. But with the package baking in the summer heat on her porch, that was not the case.

“The ice packs were warm,” Anderson said. “The shot was warm.”

Panicked, she called the company that supplies her Stelara, Accredo, a specialty pharmacy and subsidiary of Express Scripts and the third-largest pharmacy benefit manager (PBM) in the United States.

Anderson explained her concerns, and Accredo’s representative told her to take the shot anyway.

For two weeks, Anderson hoped for the best. Then the symptoms hit.

“By then, the arthritis was full blown,” she said.

Her body was covered “head to toe” in red, scaly psoriasis patches.

“It's like a horrible, horrible, horrible sunburn all over your body,” Anderson said.

Soon after, her joints flared up. She could no longer walk barefoot due to the pain in her feet. Her hands were so weak she couldn’t open bottles or hold objects.

All of her joints — elbows, knees, ankles, hips — became painful when her arthritis flared. Even her toes swelled up “like little sausages.”

“I’m in tears because it hurts so bad,” Anderson said.

But Anderson’s battle wasn’t just with her body. It was also with Accredo.

She had already paid a $150 copay for a damaged injection. Now she was being told she’d need to pay it again for a replacement.

“I've already paid the $150 and that was for a bad shot,” Anderson said. “Why do I have to pay another $150 just to get a replacement?”

After weeks of calls, Accredo finally relented and sent a new dose, without charging her another $150.

To this day, Anderson dreads delivery days. But she has no choice. Her insurer, through Express Scripts, requires her to get Stelara by mail from Accredo. She cannot pick it up from her local pharmacy.

What are PBMs?

Anderson’s experience isn’t unique — and it traces back to the often unseen role of PBMs in the U.S. health care system.

PBMs are the middlemen between health insurance companies, drug manufacturers and pharmacies. Originally, they were meant to help manage prescription drug benefits for health plans, employers and government programs such as Medicaid.

Today, many pharmacists, and others in the pharmaceutical industry, argue that PBMs are focused more on profit than patient care, steering patients toward their own vertically integrated pharmacies — like CVS Caremark directing patients toward CVS, or OptumRx toward UnitedHealth-affiliated providers.

Gov. JB Pritzker took aim at PBMs during his State of the State address in February, and is backing a legislative measure that would rein them in.

“One of the great ironies of our modern age is that breakthroughs in research are producing medications that can treat and even cure long-standing chronic diseases, but the high costs of these drugs are making them unaffordable for people who need them the most,” Pritzker said during his address. “What's causing that? Well, patients, health care providers and independent pharmacists will all tell you that pharmacy benefit managers, or PBMs, are driving up prices.”

The legislation, SB 2385, filed by state Sen. David Koehler, D-Peoria, would curb PBM abuses by stopping steering, mandating fair reimbursement and requiring PBMs to submit annual pricing reports.

The bill, which has been assigned to the Senate Executive Committee, is still being negotiated.

The Pharmaceutical Care Management Association, the national association representing the country’s PBMs, told Lee Enterprises in a statement that the "core mission" of PBMs was to reduce drug costs for patients.

"PBMs are working on behalf of Illinois employers, unions and patients in the fight against high drug costs," said PCMA spokesman Greg Lopes. "In fact, PBMs save Illinois patients and employers $1,154 per person per year."

" PBMs for pharmacy closures is not based on facts," Lopes said. "PBMs recognize the vital role Illinois pharmacies play in creating access to prescription drugs for patients and are supporting community pharmacies in rural areas through programs that increase reimbursements.”

But Pritzker, who last year took on health insurance companies in a successful effort to ban the cost control measure known as step therapy, along with reining in prior authorization, said PBMs “extract extra profit from patients through opaque and often predatory tactics.”

“They are not doctors, but they work with insurance companies to deny people the drugs and treatments doctors prescribe,” the governor said. “Not only are they driving up health care costs for Illinois families by hundreds of millions of dollars per year, but they are also putting small, local, independent pharmacies out of business.”

According to the American Medical Association, “Nationally, insurers that are vertically integrated with a PBM covered 72% of people with a commercial or Medicare Part D (prescription drug plan).”

Essentially, this means the four largest PBMs — CVS Health, Optum Rx, Express Scripts and Prime Therapeutics — dominate the market.

This monopolization has ripple effects. Independent pharmacies are being squeezed out of business, unable to compete or even survive. Patients then lose access to nearby pharmacies, and “pharmacy deserts” begin to grow.

In urban areas, a pharmacy desert is defined as a low-income area with limited vehicle access and no pharmacy within a half mile, or no pharmacy within a mile regardless of transportation.

In rural areas, a pharmacy desert is considered an area where a community of 500 people or more is located at least 10 miles from the nearest pharmacy.

The other issue is that PBMs are reimbursing pharmacies, especially local, independent pharmacies, well below the actual cost of the drug.

“We cannot dispense a brand-name medication if it means we're going to lose $50, $100, $350,” said Lauren Young, owner of Dale’s Southlake Pharmacy in Decatur and Colee’s Corner Drug in Forsyth. “We've seen multiple hundreds of dollars of loss on a single prescription, and that's just not feasible for a small business to have to shoulder — and that's just for one patient.”

And it’s not just the drug cost. PBMs also underpay dispensing fees, which cover costs for pill bottles, labels, the salary of the pharmaceutical tech who is providing counseling on the medication, and even electricity.

“All of those things need to be accounted for, because no pharmacy — and I don't care if you're Walgreens or you're the corner drug store — nobody can sell enough on the front end to ever make up for the losses in the prescription end,” said Monique Whitney, executive director of Pharmacists United for Truth and Transparency. “Pharmacies didn't go into the business to sell sundries. They're in the business of dispensing medication.”

How have PBMs affected Illinois?

Between 2009 and 2021, nearly 838 pharmacies closed in Illinois, according to researchers at Southern Illinois University in Edwardsville.

Pharmacy owners have cited poor reimbursement, rising overhead costs and patient loss due to PBM steering as reasons for closing locations.

Dave Falk, who owns 10 independent pharmacies across central and southern Illinois, including the now-closed Sav-Mor pharmacy in Shelbyville, the Family Drug in Shelbyville and Bertram Pharmacy in Robinson, has had to close five of his pharmacies in the past four years.

“Three of the five were the only (pharmacies) in the community,” Falk said. “It left those communities without a pharmacy.”

Falk said residents in those areas now without his pharmacies are having to travel upward of 18 miles to get to the closest pharmacy, meaning they are living in pharmacy deserts.

The same study from SIUE found that 73% of counties in Illinois fit the definition of pharmacy deserts.

“PBMs have hidden in the weeds for decades,” Falk said. “In the last five or six years, they've gotten so egregious in their actions that it used to be 10% of your business that you've lost money on because of their payment methods. (That) is one thing. When it’s 80%, it's just not sustainable.”

David Bagot, owner of Petersburg Pharmacy and president of the Illinois Pharmacists Association, has seen similar trends. He said patients are also giving up essential medications due to cost.

“Medicare Part D is a very unique federal benefit that has a deductible phase. And every year, (patients on Medicare Part D) come in and they're on Eliquis, which my cost is $575 for a 30-day supply. They come in to get their Eliquis. They're like, what? And I've seen people turn around, walk out — yeah, wow — not get it, find out they had a heart attack, and were in the hospital a week later,” Bagot said.

Bagot said his patients, like Falk’s, have also been steered to PBM-integrated pharmacies. Patients of Bagot’s who have lower incomes have been hurt by steering practices the most.

“The people who are doing well financially in our economy, they can just drive to Springfield, right? It's an inconvenience. It's not a massive problem,” Bagot said. “But what about the people who are on a fixed income because they're old or they're the poor, once again, in this (freaking) nation, we're seeing the people hurt the worst by this are the people who are most economically vulnerable.”

Editor's note: This story has been updated to include a comment from the Pharmaceutical Care Management Association.