PBM Reform Act of 2025

Section 2(a) requires prescription drug plan sponsors to permit any willing pharmacy to participate in their network as long as the pharmacy meets standard, reasonable, and relevant contract terms. This gives everyday people more choices and easier access to local pharmacies they trust.

Section 3(a) restricts pharmacy benefit managers from collecting income other than flat, fair-market bona fide service fees and requires them to fully pass through manufacturer rebates and discounts to plan sponsors. This transparency and restriction on hidden profits can help lower overall drug spending and relieve financial pressure on everyday individuals.

Section 3(a) also requires pharmacy benefit managers to submit detailed annual reports regarding drug utilization, pricing, and costs, which are subject to audits by plan sponsors. Holding these middlemen accountable helps ensure that elected officials and program administrators are keeping costs transparent for the public.

Section 4 and Section 6 add oversight and reporting requirements for group health plans and Medicaid programs, and ban spread pricing in Medicaid. Preventing spread pricing stops middlemen from taking hidden cuts between what plans pay and what pharmacies receive, ensuring taxpayer and beneficiary dollars are spent fairly on actual medical care.

Section 2(f) and Section 3(a) appropriate hundreds of millions of dollars in new government funds—including $188,000,000 for CMS program management, $113,000,000 for subsection implementation, and $20,000,000 for the Inspector General—to carry out these new federal mandates. Taxpayers ultimately bear the burden of funding these administrative costs and government oversight expansions.

Section 2(c) and Section 5(a) establish heavy civil monetary penalties up to $100,000 for pharmacies or plan sponsors that fail to comply with survey reporting or contract standards. While designed to enforce rules, aggressive penalties or compliance burdens could potentially strain smaller, independent operations or limit the resources available for patient care.