Pharmacy benefit managers face increased scrutiny and new transparency rules under a sweeping federal law passed in 2026. The legislation, known as the Consolidated Appropriations Act, 2026, mandates that PBMs disclose drug-level data to large employers and pass through all rebates and discounts. This shift is reshaping how midsize and large self-insured companies negotiate contracts with pharmacy benefit managers.
Under the new rules, employers are no longer required to rely on opaque business practices. Elizabeth Mitchell, president and CEO of the Purchaser Business Group on Health, noted that starting in 2028, PBMs must share detailed drug cost information with the employers they contract with. This requirement clarifies that PBMs are “covered service providers” under the Employee Retirement Income Security Act of 1974, which governs self-insured employers.
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“Employers and public purchasers are really adopting these new standards and expectations,” Mitchell said. “They are changing how they’re contracting and really seeking to be effective fiduciaries. And these new requirements enable that.”
The conversation highlighted a shift in power trends. Robyn S. Crosson, vice president of government relations at Navitus Health Solutions, a midsize PBM that bills itself as a transparent alternative to large PBMs, agreed that the flow of information has changed. Crosson noted that PBMs are being forced to provide the information plan sponsors need to make good judgment in what plans they pick, enabling them to pick a partner instead of just a vendor.
Fiduciary responsibility creates new liability
The law also clarifies the fiduciary responsibility of self-insured employers, making individuals liable if pharmacy benefits are not managed appropriately. Mitchell explained that the Senior Vice President of benefits could be named in a lawsuit, and it is not enough to now say, “Oh, well, my advisor thought this was a good idea or my PBM told me to do this.” Individuals are now being held to an expert standard, creating significant liability and accountability.
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Mitchell noted that even large, sophisticated employers have depended on brokers and consultants to make decisions about PBMs. While these arrangements often work out well, disclosure requirements have shown that in some cases those outside advisors haven’t worked in the best interest of the employer or plan sponsor. “It becomes even more incumbent on the employer to have neutral, unconflicted advice that is truly just in the interest of the plan,” she said.
Transparency is driving a reallocation of business. Mitchell said that 27% of PBGH’s members have moved their PBM business over to smaller transparent PBMs and that another 21% to 22% are putting their PBM business out to bid this year. Crosson said that Navitus has doubled its business in the past five years, noting that the company was the “weird kid in the lunchroom” with its promise of being fully transparent and passing through rebates.
PBM strategies to handle new rules
Both panelists expressed skepticism that PBMs would simply comply without resistance. Kathy W. Oubre, CEO of Pontchartrain Cancer, a community oncology practice outside of New Orleans, expected PBMs to shift to “new administrative fees or newly labeled clinical management charges” that are not explicitly covered by the new reporting requirements. She referenced how one of the large PBMs tried to circumvent reimbursement rules for pharmacies with a bonus pool fee.
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Oubre predicted continued vertical integration and reclassification of specialty drug categories, as well as more step therapy and narrowing of formularies. Mitchell echoed these concerns, noting that statements made in earnings calls about changes to PBM practices while staying whole “makes you wonder where the money is going to come from.” She added that PBMs may rely on administration for revenues as pass-through rules take effect and that certain forms of indirect compensation may not get reported because they were not covered by previous disclosure rules.
While the law aims to force PBMs to show their value, the panelists questioned whether the industry can truly reform itself. Mitchell said the industry is “simply not working for those who pay for and receive care” and that no one gives up wild profits easily. Crosson suggested that PBMs must see employers as partners, not “cash cows,” and that their future success depends on enhancing care and outcomes rather than hiding behind complex fee structures.
