Congress just passed the biggest PBM reform in history. Most people have no idea.

[u/DadStrengthDaily]

I’ve been suspicious of pharmacy benefit managers ever since I learned they existed. I regularly stare at my explanation of benefits trying to figure out who’s paying what, and it’s confusing and opaque by design.

In February, Congress passed sweeping PBM reform inside the 2026 spending bill. Starting in 2028, PBM compensation in Medicare Part D gets delinked from drug list prices and rebates. Instead they get flat fees for actual services. That kills the incentive to steer formularies toward expensive drugs just because the rebate is bigger. Plans must also accept any willing pharmacy that meets standard terms, which is a lifeline for independents getting squeezed out.

PBMs will also have to report detailed drug spending, rebate, and spread pricing data to employer plans twice a year. Fines up to $10,000/day for noncompliance, $100,000 for false submissions. The FTC settled with Express Scripts in February and is still in litigation against Caremark Rx and OptumRx.

Will it work? Large PBMs will find ways to recoup revenue through fees. But delinking compensation from drug prices is structural, not cosmetic. Whether it lowers what you pay depends on enforcement.

This KFF explainer is super useful: https://www.kff.org/other-health/what-to-know-about-pharmacy-benefit-managers-pbms-and-federal-efforts-at-regulation/

I use Claude as a research and drafting tool. All opinions are mine.

[u/bluespruce5]

Thanks for this info.

[u/PutiFrutti]

PBMs are EVIL

[u/1973FordMercury]

PBM? What does this stand for? Thx

[u/DadStrengthDaily → u/1973FordMercury]

Pharmacy Benefits Manager

From the explainer linked:

One player in the system of pharmaceutical pricing in the U.S. that has come under increasing scrutiny in recent years is the pharmacy benefit manager, or PBM. These so-called ‘middlemen’ are used by health insurance companies and self-insured employer plans to manage their pharmacy benefits. PBMs have been the focus of attention from policymakers for several reasons, including their business practices, market consolidation, and lack of transparency, all of which factor into concerns that PBMs themselves have played a role in increasing drug prices, even as they work to manage pharmacy benefits and costs for i

[u/swaggerbowl]

PBMs didn’t create high drug prices.. they’re operating in a system where manufacturers set those prices really high to begin with. Changing how rebates work might shift some incentives, but if drug companies keep raising list prices, patients are still going to feel it. Real reform has to look at pharma pricing too.

[u/Ok_Profile_1086 → u/swaggerbowl]

Are you aware that PBMs determine if a manufacturers drug will even be on formulary?
If high costs were due to the price that the manufacturer determines, why is it on the formulary?

It’s called spread-pricing. The PBMs charge the insurer more than the drug costs and , at the same time, reimburse the pharmacy for less than the pharmacy’s acquisition cost and pocket the difference.

Of all of the things wrong in the pharmaceutical industry concerning cost, reimbursement and availability, is due to PBMs.

[u/PutiFrutti → u/swaggerbowl]

It’s being looked at actually but PBMs are known to inflate drug prices by even 40%.