A new analysis from the Office of Inspector General found a similar net cost for drugs through vertically-integrated Part D plans compared to other plans.
Vertically-integrated firms accounted for 35% of contracts Part D in 2023, according to OIG's report. Eleven of the 300 organizations offering Part D coverage that year were considered vertically integrated, meaning they also owned a pharmacy benefit manager.
While net drug costs were on par between the two types of organizations, the study found that vertically integrated firms came to those prices through different means than other organizations. In most cases, vertically integrated Part D plans paid pharmacies more initially but then clawed back more through fees and rebates to reach a net price.
Other Part D plans, meanwhile, generally paid less upfront but also got less back from pharmacies later on.
The report also found that vertically integrated firms largely paid their own pharmacies less than others, but the data did not allow OIG's analysts to "account for later payment adjustments to pharmacies that usually reduce what they ultimately receive."
In addition, OIG's review found that 79% of the 54.6 million individuals with Part D coverage received it through one of the vertically integrated firms. People enrolled in these plans generally saw lower premiums but faced far higher out-of-pocket costs for their medications, per the report.
However, OIG said that ultimately, the full impact of vertical integration in Part D remains hard to quantify, as the full data on pharmacy payments is lacking and there have been significant shifts in the market of late.
"Recent changes to the Part D market and PBM requirements could increase transparency of payment models and facilitate more comprehensive assessments of vertical integration," OIG wrote in the report.
OIG's analysis also found that the six largest national payers accounted for 82% of gross Part D spending in 2023, with UnitedHealth leading the way at $75 billion. The next-highest was CVS Health at $49 billion, followed by Humana at $39 billion.
Centene accounted for $29 billion in 2023 Part D spending, Cigna for $20 billion and Elevance Health at $14 billion, per the study.