Last week’s Fortune 500 list provided a snapshot of the best in American innovation and technology that have driven, expanded and transformed the American economy.
The inclusion of several healthcare companies in the ‘Top 10’, however, suggests a different story. We should be concerned that companies like United Health and CVS, both of which benefit from millions in federal subsidies, are soaring to the top of a Fortune 500 chart. Especially as this government intervention is driving up costs for the American consumer.
Most prominently, insurers and pharmacy benefit managers consistently ranked higher on the lists than pharmaceutical companies – begging the question why the media seems to obsess over drug manufacturers when talking about the cost of medication.
Insurers have received billions in direct payments from the federal government as a part of the Affordable Care Act and are still looking to raise premiums – some as much as 91 percent – on consumers.
Clearly, something is out of balance when the federal government is subsidizing the most profitable companies in the economy at the same time these same companies are charging customers more.
Similarly, Pharmacy Benefit Mangers continue to restrict options for patients at the same time that they are increasing prices via accounting and formulary gimmicks. Yet, bizarrely, these “middlemen” receive little to no scrutiny and are often unnoticed by consumers who are unaware of the complex pipeline that a pharmaceutical travels from the manufacturer to the pharmacy counter.
PBMs engage in legal, though ethically dubious, practices such as imposing “gag clauses” on pharmacists, preventing your neighborhood pharmacist from helping you to find the cheapest medication. These actions only increase a PBMs profit, despite adding no value to the pharmaceutical and costing the consumer more.
With this background in mind, perhaps it isn’t in fact surprising that these companies ranked so highly and above pharmaceutical manufacturers on the Fortune 500 list.
As consumers, taxpayers and citizens, however, we should ask why it is we are letting our federal government give away our money to subsidize these companies with so little to show for it.