THE OUTLOOK FOR HEALTH CARE IN 2023:

What you need to know about the forces reshaping our industry.

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June 9, 2022

Around the nation: FTC launches investigation into PBM practices

Daily Briefing

    The Federal Trade Commission (FTC) voted unanimously to launch an investigation into the nation's largest pharmacy benefit managers (PBMs), in today's bite-sized hospital and health industry news from the District of Columbia, Florida, and Texas.

    • District of Columbia: FTC on Tuesday unanimously approved an investigation into the impact vertical integration into the PBM sector has on access and pricing within the prescription drug market. According to FTC Chair Lina Khan, "[t]he FTC's forthcoming PBM inquiry will examine several of the most common complaints about PBMs and will seek to assist policymakers in determining whether Americans would benefit from reforms to this critical industry." For the investigation, FTC will send compulsory orders to the six largest PBMs in the United States, including CVS Health's CVS Caremark, Cigna's Express Scripts, UnitedHealth Group's OptumRx, Humana, Blue Cross and Blue Shield-affiliated Prime Therapeutics, and MedImpact Healthcare Systems. Notably, CVSCaremark, ExpressScripts, andOptumRx collectively control roughly 80% of the PBM market, Modern Healthcare reports. (Daily Briefing is published by Advisory Board, a division of Optum, which is a wholly owned subsidiary of UnitedHealth Group.) (Silverman, STAT News, 6/8; Goldman, Modern Healthcare, 6/8; AHA News, 6/7)
    • Florida: Broward Health Imperial Point on Friday appointed Judy Frum as its new CEO. Previously, Frum served as interim CEO of the hospital, and before joining Broward, she was COO and interim CEO of Memorial Regional Hospital. "Judy is a trusted healthcare executive with extensive experience in the South Florida marketplace," said Shane Strum, president and CEO of Broward Health. "Her leadership will have a positive impact for our patients and staff at Broward Health Imperial Point. (Gonzalez, Becker's Hospital Review, 6/7)
    • Texas: Oracle on Tuesday announced that its $28.4 billion acquisition of EHR company Cerner would close Wednesday after the majority of Cerner's outstanding shares were validly tendered. According to Oracle, Cerner will act as the company's "anchor asset" in its expansion into health care. After the acquisition is complete, Oracle plans to maintain Cerner as a separate business unit. Oracle will move Cerner's systems to its existing cloud data centers. Notably, the acquisition marks the largest merger and acquisition transaction in the digital health sector, according to data from Modern Healthcare. (Cohen, Modern Healthcare, 6/7)

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