February 5, 2026 Washington Wire

Pharmacy benefit manager (PBM) reform included in government funding package

By Wire Reports

Pharmacy benefit manager reform, along with other health care measures, was part of legislation signed by President Donald Trump this week, ending a partial government shutdown.

The funding bill, the Consolidated Appropriations Act 2026, includes transparency requirements for PBMs. Provisions in the bill include:

Prohibit PBM compensation in Medicare Part D from being tied to the manufacturer’s list price of a drug – a policy known as “delinking - in an effort to reduce drug prices and save money for taxpayers. Instead, intermediaries negotiating on behalf of the program would be paid a fee that reflects the fair market value of their services.
Promote price transparency for prescription drugs purchased by employer health plans by ensuring PBMs provide group health plans and issuers with detailed data on prescription drug spending at least semiannually. Such data includes gross and net drug spending, drug rebates, spread pricing arrangements, formulary placement rationale, and information about benefit designs that encourage the use of pharmacies affiliated with PBMs. This also ensures that health plans and individuals can receive a summary document regarding information about the plan’s prescription drug spending.
Require the Centers for Medicare & Medicaid Services to define and enforce “reasonable and relevant” Medicare Part D contract terms, including information about reimbursement and dispensing fees. The bill also establishes an appeals process for pharmacies to dispute terms that do not follow the reasonable and relevant standards. CMS also has enforcement authority to impose monetary penalties, and CMS will receive $188 million for implementation.
Promote transparency by allowing CMS to track payment trends to pharmacies and pharmacy inclusion in PBM networks, including a designation of essential retail pharmacies.

PBMs under scrutiny in Washington

Regulators and lawmakers have increasingly criticized PBMs, arguing that the middlemen drive up the cost of drugs and steer patients toward affiliated pharmacies at the expense of independently owned drugstores.

The three largest PBM companies, owned by insurers, account for 80% of the market. They are Cigna subsidiary Express Scripts, United Health’s Optum Rx and CVS Caremark. Critics argue their effective monopoly discourages inclusion of independent pharmacies as preferred providers.

However, the Pharmaceutical Care Management Association, which represents PBMs, said the reforms won’t lower drug prices and argued lawmakers should now target pharmaceutical manufactures for their role in rising medication costs.

In addition to PBM reform, the bill extends some pandemic-era health care policies. Expanded Medicare reimbursement for telehealth was funded through 2027. In addition, the Acute Hospital Care at Home Program, an initiative that allows approved hospitals to deliver inpatient care in patients’ homes, has been extended through Sept. 30, 2030.