Health care consolidation in the US has a negative impact on cancer care.

Mergers and acquisitions of national players at various levels of the supply chain, including pharmacies, have been increasing in the US healthcare sector over the past two decades. The pharmacy marketplace has undergone significant changes, with vertical and horizontal consolidation, increasing challenges from independent pharmacies, the growth of specialty pharmacies, and the presence and influence of pharmacy benefit managers (PBMs). The landscape is complex, with conflicting views and theories on the impact of these market changes, and whether they are driving up costs and out-of-pocket costs for cancer patients.

In contrast, Walgreens also expanded, but remained primarily in the pharmacy market. The second largest pharmacy store chain in America behind CVS Health, Walgreens has been busy fending off the competition by integrating other chains and related e-commerce into its brand. In the past decade, Walgreens has acquired New York City-area chain Duane Reade; Drugstore.com and Beauty.com; Alliance Boots; a Mid-South drug store chain operating under the USA Drug, Super D Drug, May Drug, Med-X and Drug Store banners; And finally, the drug store chain Rite-Aid.

However, some argue that these purchases may have little effect on cancer patients. Ann Johnson (Pharmacy Healthcare Solutions, Pittsburgh, PA, USA) says, “While consolidation of retail pharmacies may cause some problems for patients, consolidation of pharmacies is not expected to have much impact on cancer care in the community setting.” “The cost that patients pay for drugs, such as their copays, is set by health plans and PBMs, not by the pharmacies themselves, so pharmacy consolidation does not result in higher prices for consumers. Similarly, from the pharmacy’s perspective, the amount the pharmacy is paid is established in the PBM network agreements.”

Oncology drugs were traditionally given in healthcare settings, but the advent of oral anticancer agents has changed that dynamic. Although some patients get their medications at a retail pharmacy, most use a specialty pharmacy or receive them by mail order. Additionally, a model known as medically coordinated dispensing allows oncologists to dispense oral anticancer drugs at on-site pharmacies. Nicholas Ferreiros (Community Oncology Alliance, Washington, DC, USA) notes that other forms of consolidation where the insurer, physician and PBM are connected are more threatening to the integrity of cancer care.

One concern is the vertical integration of insurers and physicians, where insurance companies supply their own experts, Ferreiros said. One example is UnitedHealthcare, the largest health insurer in the USA and also the largest single employer of doctors in the country. Optum Care, a subsidiary of UnitedHealth Group, has approximately 43,000 affiliated or employed physicians. Optum’s Healthcare division includes MedExpress’s urgent care facilities, Surgical Associates’ ambulatory surgery centers, House Calls, home visits, behavioral health, care management, and Rally Health’s wellness and digital consumer engagement. “You can control primary care referrals and you can control prescriptions and put everything in the network as a fully integrated entity,” says Ferreiros. “Decisions are not always in the best interest or best value for patients.”

Ferreiros explained that PBMs are more likely to push for brand-name drugs versus generics or biosimilars because they have an incentive to support higher-priced drugs. Because PBMs often receive discounts calculated as a percentage of the manufacturer’s list price, they receive larger discounts for higher-priced drugs as opposed to lower-priced drugs. “Patients who pay high deductibles or out-of-pocket payments based on drug list prices may end up paying more out of pocket,” Ferreiros said.

The consolidation of PBMs is even more worrisome because it allows a small number of corporations to have an unprecedented level of control over the health care system. Although there are dozens of PBMs, the three largest by market share are all vertically integrated with a large downstream insurer: Caremark with CVS/Aetna, Express Scripts with Cigna and OptumRx with United. The largest PBM not owned by a single health insurer is Prime Therapeutics, owned by 14 Blue Cross and Blue Shield health plans.

“This is not good for any patient,” says Matthew Seiler (National Association of Community Pharmacists, Alexandria, VA, USA). “PBMs integrate upstream with the insurer and downstream with pharmacy, and that creates an access problem.”

Seiler said patients can’t use the pharmacy of their choice because it’s “not in network” and instead are directed to integrated pharmacies. “For example, they may have to use mail order,” Seiler said. “This creates delays in taking the medicine, the price may be higher, etc. Patients are not given a choice and there is no transparency of the cost.

Lena M. Kahn (FTC, Washington, DC, USA) said in a statement: “Although many people have never heard of pharmacy benefit managers, these powerful middlemen have a significant impact on the US prescription system. “This study sheds light on the practices of these companies and their impact on pharmacies, payers, doctors and patients.”

The Community Oncology Alliance cites access and cost as the two main issues with the loss of community practice. When rural clinics close, for example, this creates access problems, as patients have to travel more for care. This access problem poses a particular problem if patients have transportation or mobility challenges.

The rise of PBMs and pharmacy consolidation, along with the steady loss of independent oncology practices, may be creating additional barriers to accessible and affordable cancer care. Healthcare mergers and acquisitions continue at a steady pace, but they can negatively impact the cost, quality, and access of cancer care.