Mark Cuban Says Big Insurance Companies And PBMs Control Healthcare Costs, 'Everyone Has To Kiss Their A-- And Accept The Complications'

Billionaire Mark Cuban has never shied away from speaking out about what's wrong with the U.S. healthcare system. In a recent post on X, Cuban explained that healthcare should be simple, but it's become overly complicated by big insurance companies and pharmacy benefit managers. These groups, he says, act as middlemen, controlling not just the costs but also the accessibility of care.

For Cuban, healthcare should come down to two basic questions:

• What's the cost?
• How can the patient afford it?

But according to him, PBMs and insurance companies add unnecessary complexity, controlling which doctors and medications patients can access. Cuban doesn't mince words when it comes to his frustration with this system, saying, "They are able to do so because they control the flow of patients for hospitals/providers and drug manufacturers. They are the gatekeepers for trillions of dollars of healthcare spending. Everyone has to kiss their a– and accept the complications."

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How PBMs Are Driving Up Drug Prices

Cuban has been particularly vocal about PBMs, which act as go-betweens for drug manufacturers, pharmacies, and insurers. In a post for Drug Channels, he laid out five key ways PBMs are making the healthcare system worse:

1. Lack of Transparency: PBMs often keep their pricing and contracts hidden, making it hard for consumers to shop around and compare prices.
2. Inflated Specialty Drug Prices: PBMs label certain medications as "specialty drugs" and then drastically increase the prices. However, Cuban wrote that there's "nothing special about most of these drugs."
3. Rebate Distortion: PBMs negotiate rebates with drug manufacturers, but the savings don't necessarily reach the consumer. Instead, they can lead to higher costs for patients in need of expensive medications.
4. Formulary Restrictions: PBMs decide which drugs are covered based on their own financial incentives rather than medical necessity, limiting treatment options for patients.
5. "Sh–ing on" Independent Pharmacies: "S———ing is the appropriate word to describe the financial abuse that we've heard about from non-captive pharmacies," Cuban wrote." Small, independent pharmacies often can't compete with PBMs, which charge them unpredictable fees and can conduct audits at will, sometimes driving them out of business.

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Cuban's Solution: Transparency and Direct-to-Consumer Pricing

To address these issues, Cuban co-founded Cost Plus Drug Company. The company cuts out PBMs entirely, offering consumers a chance to buy medications at a transparent price. Cost Plus Drugs charges a fixed 15% markup on the wholesale price, along with a small pharmacy and shipping fee.

In a conversation at the University of Pennsylvania, Cuban pointed out how much trust has been lost in the healthcare system. He says that transparency could be the key to winning that trust back. That's why his company is committed to showing consumers exactly what they're paying for—something that most drug pricing models don't do.

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Can Healthcare Reform Fix the Problem?

Cuban has repeatedly said that removing PBMs from the equation would make healthcare more affordable and clear. He argues that if PBMs were out of the picture, the trillions of dollars saved could go toward helping the patients who can't afford care.

"There is a fix," Cuban wrote. "The federal government, states, and self-insured employers can stop doing business with the big three PBMs…State and federal agencies and big companies could switch out from those big PBMs and use their competitors. This would change an entire industry in less than five years."

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