What just happened with Rx? Key developments employers need to know  

Four major pharmacy developments in the last few weeks have grabbed headlines: Pharmacy Benefit Manager reforms in government funding legislation and a proposed agency rule; a significant settlement agreement between a PBM and the Federal Trade Commission; and the rollout of TrumpRx. The key themes across these moves are greater transparency to employer plan sponsors and fiduciaries, rebate pass-throughs and expanded federal oversight – each of which, over time, should help spur meaningful change in pharmacy benefits contracts. 

1. Consolidated Appropriations Act, 2026 

Two major PBM reforms long sought by employer plan sponsors were signed into law as part of the Consolidated Appropriations Act, 2026 and will take effect in plan years beginning on or after Aug. 3, 2028. 

• Rebate pass-through for ERISA group health plans. Plan service providers contracting with a group health plan for PBM services must agree to remit 100% of the rebates, fees, alternative discounts and other remuneration from drug manufacturers, wholesalers, rebate aggregators and certain other entities to the plan, or to the insurer, if the group health plan is insured.
• PBM reports. The 2026 CAA requires PBMs to report detailed information to health plans about the plan’s drug coverage and utilization. This includes drug-level information about PBM compensation such as spread pricing, dispensing channels, rebates, plan and member spending including out-of-pocket spending, steering to PBM pharmacy affiliates, and formulary structure.

The 2026 CAA also clarifies that the ERISA broker and consultant compensation disclosures required under the Consolidated Appropriations Act, 2021 apply to a broad range of service providers, including PBMs. To learn more about the 2026 CAA, click here.

2. Proposed regulations: Improving transparency into PBM fee disclosure

Days before the 2026 CAA was passed, the Department of Labor proposed a rule to improve transparency into PBM fee disclosures. The rule would require significant disclosures that are not currently provided to fiduciaries and is intended to implement Executive Order 14273, which instructs DOL to propose regulations to improve transparency into the direct and indirect compensation received by PBMs for health plan fiduciaries. 

The rule appears to overlap in many ways with the 2026 CAA. It would require “covered service providers” to disclose extensive compensation information to plan fiduciaries of self-funded, but not insured, group health plans subject to ERISA, including services, direct compensation, manufacturer payments, spread compensation, copay clawbacks, price protections, drug pricing methodology, and more. Covered service providers include providers of PBM services and providers of advice, recommendations, or referrals regarding PBM services who are also providers of PBM services or their affiliates. Non-affiliated brokers and consultants remain subject to current disclosure rules under ERISA. The rule would also allow, but not require, plan fiduciaries to audit the accuracy of disclosures annually, receive other necessary information, and provide some relief for fiduciaries if their PBM or other covered service provider fails to meet its obligation. 

As proposed, the rule would take effect for plan years beginning on or after July 1, 2026. Because of the overlap with PBM reforms in the 2026 CAA, hopefully regulators will rework proposals to take into account provisions under the new law while providing adequate lead time for compliance. 

3. FTC settlement

Another big development was a settlement recently announced between the FTC and one of the major PBMs and its affiliates regarding insulin pricing and more. Notably, FTC enforcement against other major PBMs is ongoing. It is not clear whether those organizations will enter into similar settlement agreements with the FTC. 

The settlement requires the PBM to “re-shore” its group purchasing organization from Switzerland to the US and make changes to their “standard offering” and other contractual provisions. The settlement describes several provisions that must apply to a PBM’s standard offering that the PBM apparently will offer to self-funded plan sponsors. There are also special rules for insured plans. Significantly, the settlement allows self-funded plans to opt out of the standard offering. However, many employers may benefit from the changes that simplify the standard contract offerings.  

The settlement is also intended to increase transparency for plan sponsors. The PBM has agreed to mandatory, drug-level reporting as part of its standard offering, in addition to providing data to permit compliance with the Transparency in Coverage regulations and disclosing payments to brokers and consultants in connection with the provision of pharmacy benefit services to plan sponsors.  

4. TrumpRx launch 

The TrumpRx direct-to-consumer website launched last week. The website is designed to serve as a search portal; it does not sell medications directly but directs consumers to manufacturer direct-to-consumer programs or, in many cases, to coupons to take to their pharmacy to purchase the medication locally. Over time, as online manufacturer direct-to-consumer programs mature, they are likely to replace the coupons currently available on the website. 

TrumpRx is centered on brand name medications. Currently, there are 43 branded drugs represented on the website. Of note, generic versions of these brand medications may be available to consumers for a lower cost. It’s important for patients to shop all options. For those with employment based medical coverage, their employer-sponsored prescription drug plan may still be the least costly for them unless a specific drug is excluded from coverage.  

What’s next? 

Some of the recent developments will likely become table stakes for PBM contracts with self-funded plans going forward, although it may take a number of years. Many PBMs that have been paid based primarily on spread are looking at revised delivery structures to address market demand. In combination with current transparency requirements like RxDC plan level filings, new state laws, and so on, plan fiduciaries will have unprecedented line of sight into PBM arrangements. The mantra of increased visibility into PBM cost structure is not going away and seems to be evolving into a new standard. 

Mercer believes transparency is a good thing. We prioritize our clients and take pride in being their trusted adviser in delivering pharmacy benefits. The 2026 CAA PBM reforms are a constructive step for the market. They validate the steps we’ve taken to create more transparency and accountability and will help us further educate clients on how pharmacy economics work and how to navigate them. We engage clients transparently about our services, fees, and compensation because we believe it leads to better outcomes for them, their employees, and the market.