New Bipartisan Bill Targets Healthcare Conglomerates' Vertical Integration

Proposed legislation seeks to curb anti-competitive practices by requiring pharmacy benefit managers to divest pharmacy businesses.

A bipartisan bill introduced by Senators Warren and Hawley aims to prohibit pharmacy benefit managers (PBMs) and health insurers from owning pharmacy businesses, citing anti-competitive concerns.
The legislation follows scrutiny of vertically integrated healthcare conglomerates like CVS Health, which combine PBMs, pharmacies, and insurance services under one entity.
Critics argue that such integration drives up patient costs, limits competition, and reduces access to independent pharmacies, while benefiting conglomerates' affiliated entities.
PBMs have faced accusations of opaque pricing practices, failing to pass rebate savings to consumers, and preferential treatment for their own subsidiaries' products and services.
If passed, the bill would mandate divestiture of pharmacy businesses within three years, though historical precedent suggests such actions are complex and time-intensive.