10 Things To Know About the Proposed Federal PBM Transparency Rule (2026-01907)

At KneeTie Go Run Go, we closely monitor regulatory developments that influence healthcare affordability, employer-sponsored health plan sustainability, and patient access to medications. A newly proposed federal rule seeks to significantly increase transparency and accountability among Pharmacy Benefit Managers (PBMs). Below are key insights healthcare leaders, employers, and policy stakeholders should understand

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1️⃣ PBMs Must Disclose How They Get Paid: PBMs would be required to fully disclose all direct and indirect compensation received from drug manufacturers, pharmacies, brokers, and third parties.👉 Enables employers to assess fee reasonableness and identify potential conflicts of interest.

2️⃣ Disclosures Must Be Provided BEFORE Contracts Are Signed: PBMs must provide compensation transparency before entering or renewing employer health plan agreements.👉 Allows employers to compare vendors and negotiate stronger, data-driven contracts.

3️⃣ Applies Primarily to Self-Insured Employer Health Plans: The rule focuses on ERISA-covered self-insured employer plans covering more than 100 million Americans.👉 Reinforces fiduciary responsibility to control healthcare spending responsibly.

4️⃣ Brokers and Consultants Must Also Disclose Payments: Disclosure includes referral fees, commissions, shared rebates, and per-prescription payments.👉 Helps eliminate hidden financial steering incentives.

5️⃣ Future Compensation Must Be Disclosed: PBMs must report reasonably expected future compensation, not just historical payments.👉 Prevents undisclosed revenue streams from emerging after contracts are finalized.

6️⃣ Employers Gain Expanded Audit Rights: The rule proposes mechanisms allowing fiduciaries to verify disclosures, audit payment accuracy, and monitor compliance.👉 Strengthens employer oversight and transparency enforcement.

7️⃣ Enhanced Spread Pricing Transparency PBMs frequently generate revenue through spread pricing — charging employers more than pharmacies are reimbursed.👉 The rule aims to expose these pricing differentials and clarify drug cost drivers.

8️⃣ Manufacturer Rebates and Incentives Must Be Disclosed Includes rebates, administrative fees, price-protection payments, and other manufacturer incentives.👉 Addresses concerns that rebates may influence drug selection and pricing strategies.

9️⃣ Addresses Conflicts in Formulary DesignPBMs influence drug coverage decisions, step therapy protocols, prior authorization requirements, and substitution strategies.👉 Employers gain visibility into whether clinical decisions may be financially influenced.

🔟 Part of Broader Federal Drug Pricing Reform EffortsThis proposal aligns with national initiatives focused on lowering prescription drug costs, improving competition, and increasing healthcare transparency.

Healthcare transparency is foundational to improving affordability, strengthening employer-sponsored coverage, and ensuring patient-centered care delivery. KneeTie Go Run Go remains committed to supporting policy awareness, innovation, and solutions that enhance healthcare system accountability.

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