GAO Finds Vertically Integrated Medicare Part D Sponsors Use Own Pharmacies for 24% of Prescriptions

The Government Accountability Office identified four large Medicare Part D plan sponsors that are vertically integrated with pharmacy benefit managers and pharmacies. For these sponsors, pharmacies they owned accounted for about 24 percent of Part D drug utilization and about 28 percent of total payments to pharmacies in 2023.

When the sponsors paid for a 30-day supply of the 100 most commonly used prescription drugs, payments and cost sharing were lower at owned pharmacies for at least 94 percent of those drugs. The drugs were primarily generic, and average payments for a 30-day supply at both owned and non-owned pharmacies were $10 or less. Owned pharmacies were primarily mail-order locations, whereas non-owned pharmacies were mainly retail.

For the 100 drugs with the highest total payments in 2023 - primarily brand-name drugs - payments were generally lower at owned pharmacies as well. However, for about half of the 20 drugs with the highest payments per 30-day supply, cost sharing at owned pharmacies was up to about $340 higher than at non-owned pharmacies.

Medicare Part D spent $150 billion on prescription drug coverage for 54 million beneficiaries in 2025. The four selected sponsors represented over 40 percent of total Part D enrollment in 2023. GAO notes that the results for these sponsors in 2023 are not generalizable to other sponsors or years.

The report was prepared at the request of the agency overseeing Medicare Part D and can be obtained from GAO contact John Dicken at dickenj@gao.gov.