UnitedHealth, the employer of deceased executive Brian Thompson, was discovered to have overcharged certain cancer patients for medications by more than 1,000 percent

by Owen
Published On:
UnitedHealth, the employer of deceased executive Brian Thompson, was discovered to have overcharged certain cancer patients for medications by more than 1,000 percent

According to Federal Trade Commission findings, UnitedHealth Group charges patients a markup for key life-saving drugs that could easily exceed the cost by a factor of ten or more.

The report, which makes the same allegations against CVS and Cigna, is the latest indictment of America’s broken healthcare system, following last month’s shocking murder of UnitedHealthcare CEO Brian Thompson.

The United States is notorious for incurring the highest costs per capita of any wealthy nation while failing to achieve even a remotely equivalent improvement in patient outcomes compared to Europe’s social market-based economies.

Critics argue that this is primarily due to the highly opaque manner in which unnecessary markups are hidden to conceal inefficiencies that benefit various vested interests.

These include, but are not limited to, the three major drug middlemen known as pharmacy benefit managers (PBMs).

According to the FTC report, UnitedHealth’s OptumRx, Cigna’s Express Scripts, and CVS Caremark Rx were able to earn an additional $7.3 billion in revenue above cost during the study’s five-year period, which ended in 2022.

“The Big 3 PBMs marked up numerous speciality generic drugs dispensed at their affiliated pharmacies by thousands of percent, and many others by hundreds of percent,” according to its findings.

A thousand percent increase in the price of a drug that costs $10 wholesale results in a retail price of $110.

This markup rate was applied to 22% of the speciality therapies studied, including Imatinib, a generic used to treat leukaemia, and non-oncological Tadalafil for pulmonary hypertension.

Others, such as Lamivudine, which HIV-positive patients require, cost nearly quadruple as much to acquire.

Independent Vermont Senator Bernie Sanders has been holding Congressional hearings in an effort to shed light on the issues raised by both drug middlemen and drug manufacturers.

UnitedHealth Group in headlines for all the wrong reasons

The accused killer of Brian Thompson cited the industry’s failures as the reason for assassinating the UnitedHealth executive on the streets of New York.

Luigi Mangione received an outpouring of support on social media from Americans outraged by the Minnesota-based company’s mistreatment of their loved ones.

Thompson’s insurance arm, United Healthcare, denied twice as many claims as the industry average, according to data from comparison site ValuePenguin.

Just this month, surgeon Elisabeth Potter described how she was in the middle of operating on a breast cancer patient when United Healthcare sent an urgent call demanding proof that the procedure was justified.

“It’s out of control,” she said in a TikTok video, “insurance is out of control.”

The findings against the three major PBMs come from a report conducted under the leadership of outgoing FTC chair Lina Khan.

She has been a frequent target of criticism for her aggressive approach to investigating monopolies and combating Big Tech, earning her the ire of major Silicon Valley figures on both sides of the political spectrum.

Importantly, all five FTC commissioners approved the report’s release. This includes Andrew Ferguson, Khan’s designated replacement under Trump, and his fellow Republican, Melissa Holyoak.

Cherry picking data to push an ‘anti-PBM’ narrative

UnitedHealth’s OptumRx told Fortune that it is still reviewing the report’s specifics, but the PBM said it helped eligible patients save $1.3 billion in costs, with a median out-of-pocket payment of $5.

“Optum is lowering the cost of speciality medications, which comprises half of all drug expenditures, and providing clinical expertise, programmes and support for patients with complex and rare conditions,” according to the announcement.

CVS Caremark, on the other hand, accused the FTC of “cherry picking” its analysis by focusing on generics, which account for only a small portion of client spending over branded speciality drugs, in an attempt to mislead.

It, too, claimed to be saving clients money: out-of-pocket costs have fallen for seven years in a row, totalling a 29% reduction since 2016.

“If we’re going to have an investigation like this, the American people deserve to see the complete story based on all the facts and not just those that support a predetermined narrative,” the organisation responded in a statement to Fortune.

“The ‘anti-PBM’ policies the FTC is currently pursuing would only increase U.S. drug costs for American patients, employers, unions, and taxpayers.”

Branded drugs, on the other hand, carry significant risk because they are unproven and highly risky endeavours that can take years of experimental trials before yielding a return on investment—if they do at all.

Generic versions of off-patent drugs, on the other hand, cost only the materials required to manufacture them and benefit from an already established market with regulatory approval.

Cigna, parent of Express Scripts, did not respond to a request for comment.

SOURCE

Leave a Comment