Sen. Elizabeth Warren, D.-Mass., is demanding an audit of Express Scripts, the exclusive pharmacy benefit manager for Tricare. The Cigna Group, which owns Express Scripts, also owns pharmacy businesses in the network. Warren is shown at a Senate Armed Services Committee hearing. (James McCann/U.S. Army)
WASHINGTON — Sen. Elizabeth Warren, D-Mass., urged the Defense Department to audit Express Scripts to determine if the pharmacy benefit manager is overcharging for prescriptions and steering military families to its own pharmacies.
Express Scripts is the exclusive pharmacy benefit manager for Tricare, managing benefits for more than 9 million uniformed service members, retirees and their families.
But Warren and other lawmakers argue that Express Scripts’ role allows it to favor the pharmacies owned by its parent company, The Cigna Group.
Lawmakers cited reports by independent pharmacies and their trade groups that Express Scripts negotiated very low reimbursement rates that effectively forced out the competition.
Warren sent a letter this week to Keith Bass, assistant secretary of defense for health affairs, demanding that the Defense Department conduct regular audits of its contract with Express Scripts.
Express Scripts has managed pharmacy benefits for Tricare since 2003 and signed an eight-year, $4 billion contract in 2021. The contract with Tricare is set to expire in 2029, which would allow the military to negotiate a more favorable agreement, Warren said.
“Taxpayers deserve to know that these resources are being used for their intended purpose, not for potential self-dealing by [Defense Health Agency] contractors,” Warren wrote in the letter, dated June 8. “I made it very clear that I don’t want to hear about the audits and hear your summary. I want to see the audits.”
She referred to a Senate Armed Services Subcommittee on Personnel hearing in May, where she pressed Bass to conduct annual reviews of the contract and to provide the full data, before it is processed, directly to Congress.
Warren said that greater transparency and accountability need to be part of any future contract.
A Defense Department official, responding to a request for comment Tuesday, said that “as with all congressional correspondence, the Department will respond directly to the author.”
A bipartisan group of lawmakers in both chambers, meanwhile, said they are pushing legislation that aims to break up corporate consolidation in the health care industry that is contributing to higher drug costs.
The Patients Before Monopolies Act would require companies that own health insurers or pharmacy benefit managers to divest from their own pharmacy businesses.
“Americans are paying more and more for health care while seeing less in return. Pharmacy benefit managers are at the center of a broken system that rewards middlemen while driving up costs for patients and pushing out independent pharmacies,” said Sen. Josh Hawley, R-Mo., who is leading the Senate bill with Warren.
A bipartisan companion bill in the House is led by Reps. Diana Harshbarger, R.-Tenn.; Jake Auchincloss, D.-Mass.; Earl “Buddy” Carter, R.-Ga.; and Greg Landsman, D-Ohio.
Warren requested in her letter to Bass that the Defense Department provide the reimbursement rates that Express Scripts pays pharmacies owned by its parent company and by other pharmacies in the network.
The National Community Pharmacists Association, which represents more than 18,000 pharmacies nationwide, also raised concerns that rural and independent pharmacies are exiting the Tricare network “due to poor contract terms.”
Warren, speaking at the Senate Armed Services subcommittee hearing, said that Express Scripts charged the Defense Department an average of $484 more, per drug, for generic medication through its own mail-order pharmacies.
Bass said he was unaware of reports of Express Scripts overcharging the military. He assured Warren that Express Scripts was fulfilling the terms of its contract.
But Warren urged Bass to get a better understanding of Express Scripts’ performance through regular audits.
Express Scripts recently defended its practices, after settling with the Federal Trade Commission in February, in a lawsuit brought against benefit pharmacy managers over anticompetitive practices.
“Our priority is simple: lowering drug costs for Americans. This settlement enables us to keep moving forward, and we appreciate the administration’s reinforcement of our commitment to pharmacy benefits that put Americans first,” Express Scripts said.
