Senators Turn Screws on Health Care Industry as CEO Shooting Fuels Scrutiny

Senators Josh Hawley and Elizabeth Warren are teaming up on a bill that targets pharmacy benefit managers (PBMs) as the health care industry faces growing scrutiny following last week’s shooting of UnitedHealthcare CEO Brian Thompson.

Hawley, a Missouri Republican, and Warren, a Massachusetts Democrat, are introducing the Patients Before Monopolies Act to “prohibit joint ownership of PBMs and pharmacies.” This ownership, they argue, allows health care corporations to “enrich themselves at the expense of patients and independent pharmacies,” according to a press release.

The bipartisan bill is being introduced in the House by Representatives Jake Auchincloss, a Massachusetts Democrat, and Diana Harshbarger, a Tennessee Republican.

The bill comes as resentment toward the health care industry has reaching a boiling point after the killing of Thompson in New York City last Wednesday. Thompson was shot while approaching a Hilton hotel in midtown Manhattan for an investor conference. New York police have charged Luigi Mangione 26, with murder in connection with the shooting. He was arrested in Altoona, Pennsylvania, on Monday and faces extradition to New York.

While many Americans attacked the brutal shooting, others responded with indifference, callousness or even schadenfreude, pointing to their frustrations and previous negative experiences with the health care industry, which they argue places the bottom line over providing quality care, at the expense of consumers’ health.

If passed, the bill could address some concerns about the high price of health care spending that critics say contributes to the industry’s high profits.

What Are Pharmacy Benefit Managers?

PBMs act as a middleman between pharmacies and insurers. They negotiate prices with drug manufacturers, handle administrative work and create lists of covered drugs, known as formularies.

While PBMs are intended to lessen this administrative work and produce lower prices, critics argue that a lack of transparency in how they negotiate prices with drug companies actually results in consumers paying more. Critics also say that PBMs may charge pharmacies fees after securing a lower price and that those fees are ultimately passed to consumers, who end up paying a higher price.

The three largest PBMs in the United States are CVS Caremark, Express Scripts and OptumRx, which is owned by UnitedHealthcare.

The new bill could affect some of the major pharmacies, including CVS. Most large PBMs operate their own mail-order and specialty pharmacies, but CVS is the only major PBM that owns its own retail pharmacy, according to the Brookings Institution.

What Would New Bill Do?

The bill, according to the press release, would bar companies that own a PBM or health insurers from owning a pharmacy business. It would require any company in violation of the bill to divest its pharmacy business within three years.

Warren said the bill would “untangle these conflicts of interest by reining in these middlemen” that she says are responsible for “hiking up drug costs, cheating employers, and driving small pharmacies out of business.”

Hawley said: “The insurance monopolies are ruining American health care. Patients and independent pharmacies are paying the price. This legislation will stop the insurance companies and PBMs from gobbling up even more of American health care and charging American families more and more for less.”

The Pharmaceutical Care Management Association (PCMA), a trade group representing PBMs, responded to the bill in a statement.

“With this and any piece of legislation, it’s important to first take a step back from the rhetoric around health care and recognize that PBMs exist to serve patients by enabling employers and others to offer benefits,” the PCMA told Newsweek. “Whether it’s through negotiations to lower costs, partnerships with pharmacies, or clinical care programs, our value is in helping patients conveniently, safely, and affordably access prescription drugs.”

Reached by Newsweek, spokespersons for both Hawley and Warren cited the press release.

PBMs have previously been subject to scrutiny on Capitol Hill. Auchincloss and Harshbarger earlier this year introduced a House bill tjhat would implement more a more transparent reimbursement model while also prohibiting “steering patients to PBM-affiliated pharmacies.”

Luigi Mangione Arrest: Latest Updates

The press release made no mention of the ongoing debate about health care following the Thompson shooting. Warren told HuffPoston Tuesday that the reaction to the shooting should be a “warning.”

“Violence is never the answer, but people can be pushed only so far,” she said.

She continued, “This is a warning that if you push people hard enough, they lose faith in the ability of their government to make change, lose faith in the ability of the people who are providing the health care to make change, and start to take matters into their own hands in ways that will ultimately be a threat to everyone.”

Mangione has been charged with murder in New York and is facing four other charges, including forgery and possession of a firearm. On Tuesday, he was ordered held without bail and did not enter a plea. He is planning to fight extradition to New York.

He is being held in the State Correctional Institution in Huntingdon, Pennsylvania.

In the days after Mangione’s arrest, more details have emerged about his life, family and connections to the health care industry. He had posted online about back pain, which some of his friends have said he struggled with in the years before his arrest, but police have not listed this as a motive in the shooting.