Radar on Drug Benefits

Colorado’s legislature has passed a measure that would ban PBMs from being paid based on the price of a drug and instead require them to be compensated based on a flat fee. It appears to be the first bill approved by state lawmakers that echoes a now-stalled federal “delinking” proposal that drew fierce lobbying efforts. 

The bill, HB-1094, passed the Colorado House via a 48-15 vote on March 17, then cleared the state Senate on May 6 via a 29-6 vote. 

“We expect Governor Jared Polis (D) to sign the bill, though it can become law without his signature,” Laura Hobbs, an analyst at the institutional research firm Washington Analysis, wrote in a May 7 note to clients. “Large, vertically integrated PBMs are unlikely to be meaningfully impacted by a single state law. That said, we are watching developments in other legislatures, where about half remain in session.” 

CVS Health Corp.-owned Caremark on May 1 announced that the PBM would make Wegovy (semaglutide) the preferred GLP-1 for treating obesity on its largest commercial template formularies, effective July 1. Some other payers, including MassHealth and Point32Health, have also chosen a preferred GLP-1 for obesity, although speakers at a recent Institute for Clinical and Economic Review (ICER) webinar suggested that there are potential drawbacks to this approach, such as having people switch drugs after taking another GLP-1 or weight loss medication. 

Prem Shah, a CVS Health executive vice president, told analysts on a May 1 conference call that Caremark’s clients’ “biggest pain point” and “biggest pharmacy trend driver” has shifted from the high cost of specialty medications to the increased demand and cost of GLP-1s. He added that about one-third of Caremark’s customers have chosen not to cover GLP-1s for obesity due to affordability concerns. 

Since 2019, Prime Therapeutics has tapped The Cigna Group’s Express Scripts to handle contracting negotiations with retail pharmacies, utilizing the larger PBM’s market power to get better deals for Blue Cross Blue Shield-owned Prime. But in a new lawsuit — which could be the first of many — Michigan’s attorney general argues that the Prime/Express Scripts arrangement is anticompetitive.  

Prime argues that its network lease agreement is both legal and helps it manage costs for clients and patients. And Express Scripts says it will “vigorously defend” itself against the allegations. 

The first-quarter earnings calls held by the parent companies of the country’s three largest PBMs featured discussion about Arkansas’ new PBM law and developments related to GLP-1 medications, among other topics. Executives at UnitedHealth Group, The Cigna Group and CVS Health Corp. questioned the intent of the Arkansas law and the overall “obsession” with PBMs. 

The law, signed by Gov. Sarah Huckabee Sanders (R) on April 16, bars companies that own PBMs from also owning or operating pharmacies in the state, including retail, mail order and specialty pharmacies. While the law affects all the “Big Three” PBMs — UnitedHealth’s Optum Rx, CVS Caremark and Cigna’s Express Scripts — CVS stands to lose all its retail pharmacy business in the state when the law takes effect on Jan. 1, 2026. 

Removing Medicare Part D copay amounts for low-income beneficiaries significantly enhanced medication adherence, according to a Wakely report. As the CMS Center for Medicare and Medicaid Innovation ends the Value-Based Insurance Design (VBID) model later this year, these findings highlight the “compelling need for both state and federal policymakers to explore new strategies or incentives that enable MAOs to continue offering similar benefits” and improve outcomes to members with specific socioeconomic statuses, Wakely observed.

Beginning in 2021, Medicare Advantage plans were allowed to waive Part D cost-sharing amounts for select members through the VBID model. As of 2025, 62 MA organizations are offering that benefit for their Dual Eligible Special Needs Plan (D-SNP) members. D-SNP members who were eligible for the benefit had $0 copays on all covered drugs, through all phases of coverage.