ICYMI: “BULLSHIT” — THE NEW WAY HEALTH GIANTS HIDE BILLIONS
- mdrabczyk1
- Jan 14
- 1 min read
A new investigation by Hunterbrook takes a closer look at little-known subsidiaries, known as group purchasing organizations (GPOs), in the U.S. prescription drug market.
As the PBM Accountability Project has previously called out since the first GPO was established in 2020, these shell companies were created by major health insurers and affiliated PBMs, allowing these conglomerates to quietly keep billions meant to lower employers’ and patients’ drug costs, even while publicly promising “100% rebate pass-through.”
The money largely stays “in the family”:
Drugmakers pay large sums to the PBM’s GPO in the form of “rebates” and arbitrary fees.
The GPO sends some of that money to the PBM, which can then argue it passes rebates to the health plan, while the GPO quietly keeps a slice that never shows up on the plan’s rebate statement.
Because the GPOs are controlled by the same parent companies as the PBMs, this structure lets these entities retain hidden revenue.
As the report reiterates, these “Middlemen’s Middlemen” have reported billions of dollars in revenue, while patients continue to face rising out of pocket drug costs. GPOs – many of which are based overseas – often skirt U.S. regulations and severely limit public access to records related to these payments, raising concerns about transparency.