Congress Grills Health Insurance CEOs With Hunterbrook Exposé

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Just weeks after Hunterbrook published a yearlong investigation into PBM GPOs, members of Congress grilled the CEOs of Cigna Group, UnitedHealth Group and CVS Health about our findings that their companies diverted billions of dollars in revenue away from patients and health plans. 

UnitedHealth’s Stephen Hemsley, Cigna’s David Cordani and CVS’ David Joyner were called to Washington Thursday to appear before the House Committees on Energy and Commerce and Ways and Means.  

The hearings covered healthcare affordability, ranging from enhanced Affordable Care Act subsidies to the focus of Hunterbrook’s reporting: so-called Group Purchasing Organizations (GPOs) established under the conglomerates’ Pharmacy Benefit Managers (PBMs). 

During the Energy and Commerce hearing, legislators repeatedly cited Hunterbrook’s findings on the shell subsidiaries created by healthcare giants to get around a crackdown on PBMs pocketing rebates from pharmaceutical companies. 

Cigna created Ascent in Switzerland, CVS created Zinc in Minnesota, and UnitedHealth created Emisar in Ireland. The companies dubbed these entities “GPOs” — group purchasing organizations — but our investigation suggested the new label was just that: a label. 

“The big three health insurance corporations, knowing that PBM reform is around the corner, needed a different way to retain profits while still – on paper – complying with new requirements and the coming requirements of PBM reform,” said Rep. Jake Auchincloss, D-Mass.

Auchincloss asked UnitedHealth CEO Hemsley about his company’s subsidiary Emisar, which Hunterbrook reported to be largely a shell. In response, Hemsley claimed Emisar had “several thousand” employees. 

Did Hemsley lie under oath?  

Our reporter visited the Dublin office of Emisar and found it empty. Only about a dozen cubicles were in the room, tucked inside the Irish headquarters of UnitedHealth’s PBM Optum. 

Hunterbrook also scraped LinkedIn and company databases and identified only 29 possible Emisar employees. Hunterbrook identified LinkedIn profiles of current and former employees for all three PBM GPOs. Ascent has a company page, which facilitated clearer estimates of its workforce, but neither Zinc nor Emisar had websites or LinkedIn pages. Due to these limitations, we used generous criteria in identifying profiles for classification as Emisar and Zinc employees. For example, if a profile had “Optum” as the Company but “Emisar” in their position title, we classified them as an Emisar employee.

Hunterbrook repeatedly sent inquiries to the CEOs companies seeking clarity on their PBM GPOs over several months. None of them have answered questions. If United has evidence of the “several thousand” people purportedly employed by Emisar, Hunterbrook wants to see it. 

Auchincloss was one of several members of Congress to ask about the Hunterbrook report. 

Representative Dr. Mariannette Miller-Meeks, a Republican from Iowa, displayed a flowchart from Hunterbrook’s January 6 article mapping how money moves between entities. She blasted the CEOs for the secretive scheme. 

“So a health plan might be getting 100% of the rebates the PBM received, but the plan has no idea if the rebate got everything the GPO earned or how much money the GPO may have kept,” she said, reiterating a key finding from Hunterbrook’s reporting. “It begs the question, are PBM GPOs just to cover for the Big Three to say in a contract that they pass through 100% of the rebates they get and also a way to keep anyone else from being able to fully access brand drugs?”

Rep. Erin Houchin, R-Ind., also cited Hunterbrook by name. She pressed the executives on the astonishingly lucrative entities — whose tiny headcounts make them look like some of the most profitable companies in human history, at least on paper. 

“How is it so profitable to have a GPO? How are they profiting $50 million in revenue per employee, on the backs of American patients?” 

In response to her questions, the Congresswoman was met with silence. “No answers? Okay.”

Billionaire Mark Cuban, who owns an alternative to PBMs called Cost Plus Drugs, shared a clip of the exchange. “Great question. Easy to answer. No answer given”. 

The hearings added to mounting calls for national leaders to address the skyrocketing costs of American healthcare. 

“What we heard this week was no surprise. Patients are struggling to afford their medications even when they have insurance,” Merith Basey, CEO of the bipartisan patient advocacy group Patients for Affordable Drugs Now (P4AD Now), told Hunterbrook. 

“Any serious effort to lower health care costs must tackle the root causes of high drug prices and savings must actually reach patients, not just move between other actors in the system,” she continued, referencing schemes like PBM GPOs.”

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