PBM Compensation Disclosure Regulations Released

By SIIA – On Thursday, Jan. 29th, the Department of Labor (DOL) finally released long-awaited proposed regulations implementing – and clarifying – important aspects of the 408(b)(2)(B) Compensation Disclosure requirements.  In short, these proposed rules clarify – and confirm – that Pharmacy Benefit Managers (PBMs) and any other service provider that furnishes “pharmacy benefit management services” to a self-insured group health plan are subject to the Compensation Disclosure requirements.  The proposed rules further confirm that PBMs and these service providers would be required to furnish specified disclosures to the self-insured plan’s fiduciary, and also to permit the plan’s fiduciary to conduct an audit for accuracy of the Disclosures. Read Full Article...

HVBA Article Summary

1. PBMs Now Explicitly Covered by Disclosure Rules: The Department of Labor's proposed regulations clarify that Pharmacy Benefit Managers (PBMs) and any entity providing pharmacy benefit management services to self-insured group health plans must comply with ERISA’s compensation disclosure requirements. This means PBMs are now explicitly required to disclose both direct and indirect compensation to plan fiduciaries. The rules also mandate that PBMs allow plan fiduciaries to audit these disclosures for accuracy.

2. Comprehensive Disclosure Requirements Detailed: The proposed regulations outline in detail the types of information PBMs and similar service providers must disclose. These include descriptions of services provided, direct and indirect compensation, payments from drug manufacturers, spread pricing, drug pricing methodologies, co-pay clawbacks, price protection agreements, and formulary placement incentives. The disclosures are designed to provide transparency regarding the financial arrangements and incentives that may affect plan costs and participant outcomes.

3. Potential Expansion and Public Input Sought: The Department of Labor is considering whether to extend these compensation disclosure requirements to third-party administrators (TPAs) that provide administrative services beyond pharmacy benefits. The DOL is also seeking public comments on whether additional items, such as claims data and provider payments, should be included in required disclosures. Public comments on the proposed regulations are due by March 31st, indicating an ongoing process that may further broaden the scope of transparency requirements.

Labor Department proposes PBM compensation disclosure rule for self-insured plans

By Elizabeth Casolo – The Labor Department’s Employee Benefits Security Administration proposed regulation Jan. 29 that would require pharmacy benefit managers to disclose their compensation with self-insured group health plans. Under the rule, PBMs would have to share information on their rebates and other manufacturer payments, compensation when plan prices exceed pharmacy reimbursement, and recouped pharmacy payments. Plan fiduciaries would also be able to audit PBM disclosures. The proposal is accepting comments for 60 days, starting Jan. 30. Read Full Article...

HVBA Article Summary

1. Increased Transparency Requirements for PBMs: The proposed regulation would mandate that pharmacy benefit managers (PBMs) provide detailed disclosures about their compensation structures to self-insured group health plans. This includes information on rebates, manufacturer payments, and instances where plan pricing exceeds pharmacy reimbursement. Such transparency aims to give plan fiduciaries greater oversight and the ability to audit PBM financial practices.

2. Regulatory and Legal Context: The move comes amid heightened federal scrutiny of PBMs, including investigations and lawsuits by the Federal Trade Commission (FTC) regarding alleged practices that may contribute to higher drug costs. Recent legal actions have targeted major PBMs for their roles in drug pricing, particularly concerning insulin. The FTC has also paused and resumed cases as it navigates procedural and settlement discussions with PBMs.

3. Momentum for Broader PBM Reform: Legislative efforts to reform PBM practices are gaining traction, with the House passing elements of the PBM Reform Act as part of a larger appropriations package. These reforms have received support from various pharmacy groups, reflecting a broader push for accountability and transparency in the PBM industry. The ongoing regulatory and legislative activity signals continued momentum for changes in how PBMs interact with health plans and manage drug pricing.

PBM transparency mandates in spending bill hit Senate roadblock

By Allison Bell – The Senate is struggling to keep parts of the federal government from shutting down Saturday by passing a $1.2 trillion 'minibus' spending package. The minibus package is moving six big spending bills through Congress. One bill in the package includes $191 million in funding for the U.S. Labor Department's Employee Benefits Security Administration, $3.7 billion in funding for the U.S. Department of Health and Human Services offices that oversee HealthCare.gov and other Affordable Care Act programs, and two employer pharmacy benefit manager transparency provisions. Read Full Article... ^{_{(Subscription required)}}

HVBA Article Summary

1. Disputes Over Budget Structure and Federal Funding
   A key debate in the Senate involves how to handle funding for the Department of Homeland Security (DHS) within a broader government spending plan. To ease negotiations and avoid further delays, Senate leaders and the White House have proposed separating DHS funding into its own bill with a short-term two-week extension. This would allow lawmakers to vote on the rest of the minibus spending package—covering various domestic provisions—without the complications tied to DHS funding.

2. Objections Over Earmarks and Ongoing Investigations
   Additional obstacles stem from opposition by Republican senators to certain elements of the bill. Senators Mike Lee and Ron Johnson are pushing back against earmarks—provisions that direct federal funds to specific local projects—arguing they lead to wasteful or politically motivated spending. Meanwhile, Sen. Lindsey Graham has placed a procedural hold on the package, citing concerns about compensation for senators whose private records were obtained during a federal investigation led by Special Counsel Jack Smith.

3. Push for PBM Transparency and Legislative Gridlock
   A major feature of the package includes new rules for Pharmacy Benefit Managers (PBMs), aiming to improve transparency in how prescription drug plans are managed. Provisions would require PBMs to disclose detailed data to employers and Medicare plans, and to ensure rebates and discounts benefit consumers and plan sponsors. Despite strong bipartisan support in the House, the Senate rejected a procedural vote to bring the bill forward, increasing the risk of a temporary government shutdown unless a short-term funding measure is enacted soon.

How 17 health plans are shifting priorities in 2026

By Scott King – Becker’s connected with 17 health plan leaders to learn how their organizations are shifting their priorities in response to continued medical cost trends and affordability concerns. Question: How are your 2026 priorities shifting in response to continued medical cost trend and affordability concerns? Read Full Article...

HVBA Article Summary

1. Focus on Preventive and Personalized Care: Many health plan leaders emphasize the importance of preventive services and personalized care to improve health outcomes and reduce costs. Organizations like Humana and Highmark Wholecare are investing in coordinated care models and technologies that empower members to manage their health proactively, aiming to simplify healthcare navigation and close care gaps early.

2. Cost Containment through Innovation and Collaboration: Several plans are shifting from reactive cost management to strategic, structural changes. This includes adopting alternative payment models, leveraging AI for predictive risk management, and fostering strong partnerships with providers to align incentives and improve utilization management. These approaches aim to sustainably reduce healthcare spending while maintaining or improving quality.

3. Administrative Efficiency and Transparency: Health plans are prioritizing modernization of administrative processes to reduce inefficiencies and improve the member experience. Efforts include real-time claim validation, reducing prior authorization requirements, and enhancing transparency around costs and benefits. These initiatives are intended to lower administrative costs and provide clearer, more consumer-friendly healthcare interactions.

Travel insurance emerges as new voluntary benefit add-on

By Paola Peralta – With travel delays and uncertainty dogging employees in both their work and leisure time, travel insurance could be a worthy consideration as part of a voluntary benefit plan. Almost a quarter of all flights were delayed, and 1-3% were cancelled in 2025, due to factors like weather or operational issues, according to data from Flighty, which tracks flight info and airline statistics. To protect their plans, travelers spent $5.56 billion on travel insurance in 2024 — a 46% increase since 2019, according to the U.S. Travel Insurance Association. This surge not only points to a growing importance of travel protection, but a clear opportunity for benefit providers to meet a rising demand among employees. Read Full Article...

HVBA Article Summary

1. Rising Demand for Travel Insurance as a Benefit: The increase in travel disruptions has led to a significant rise in employee interest in travel insurance as a workplace benefit. Employers are recognizing this trend and considering travel insurance as a way to address both work-related and personal travel risks for their staff. This shift reflects a broader move toward benefits that support employee well-being both inside and outside the office.

2. Affordability and Coverage Drive Adoption: Traditional annual travel insurance products have often been too expensive for occasional travelers, but new employer-offered options are more affordable and comprehensive. For example, Crum & Foster’s plan covers trips over 100 miles from home for both work and leisure, with payroll deductions potentially under $5 per month. This makes travel insurance more accessible and attractive to employees, encouraging higher enrollment and renewal rates.

3. Family Inclusion and Utilization Trends: Pilot programs have shown that when travel insurance is offered as a voluntary benefit, not only do employees enroll, but there is also substantial interest from spouses and dependents. Enrollment among family members grew by over 200% in one case, and a high percentage of initial enrollees chose to renew their coverage. These trends suggest that travel insurance benefits can enhance employee satisfaction and retention by addressing the needs of the entire family.

Nearly 53M prior auth requests submitted in Medicare Advantage in 2024

By Paige Minemyer – A new study shows that close to 53 million prior authorization requests were sent to Medicare Advantage (MA) plans in 2024, increasing from 2023 and far above the number required in traditional Medicare. Analysts at KFF said that 53 million tally rose from 49.3 million in 2023. However, the report noted that there was an average of 1.7 submissions per enrollee in 2024, down from 2023's average of 1.8 per person as enrollment in MA continues to rise. In addition, just 625,000 prior authorization requests were submitted to the Centers for Medicare & Medicaid Services (CMS) for care provided in the original program. Read Full Article...

HVBA Article Summary

1. Significant Growth in Medicare Advantage Prior Authorization Requests: The number of prior authorization requests in Medicare Advantage (MA) plans has increased notably from the previous year, reaching nearly 53 million in 2024. This growth outpaces the number of requests seen in traditional Medicare, reflecting both rising enrollment in MA and the broader use of prior authorization in these plans. The average number of requests per enrollee has slightly decreased, suggesting that while total requests are up, they are being distributed across a larger member base.

2. Denial and Appeal Rates Highlight Differences Between MA and Traditional Medicare: In 2024, MA payers denied either fully or partially 7.7% of prior authorization requests, while traditional Medicare denied a higher proportion at 22.5%. Despite the higher denial rate in traditional Medicare, the overall volume of requests in that program remains much lower. Of the denied requests in MA, only a small fraction were appealed, but most appeals resulted in the denial being overturned, indicating that the appeals process can be effective for patients who pursue it.

3. Variation Among Insurers in Request and Denial Rates: The report found substantial differences among major insurers in both the number of prior authorization requests per enrollee and the rate of denials. Elevance Health and Centene had the highest average requests per enrollee, while Kaiser Permanente had the lowest. UnitedHealth had the highest denial rate among major MA insurers, whereas Elevance had the lowest, highlighting variability in how different companies manage prior authorization processes.

Drugs for cancer, arthritis and HIV on Medicare’s list for 2028 price cuts

By Jonathan Gardner – The federal government announced the next 15 medicines for which it will seek price reductions with the help of Medicare’s new negotiating power, including the breast cancer drugs Kisqali and Verzenio and the HIV treatment Biktarvy. Those cuts, which are allowed through the Inflation Reduction Act, will go into effect in 2028. Read Full Article...

HVBA Article Summary

1. Medicare Drug Price Negotiations Expand Significantly: The Centers for Medicare and Medicaid Services (CMS) has announced a third round of drug price negotiations under the Inflation Reduction Act (IRA), adding 15 high-expenditure drugs to the list. These include Trulicity (a diabetes medication with $4.9 billion in annual costs), Orencia, Cimzia, Xeljanz, and therapeutic uses of Botox. Together, these drugs represent a combined $27 billion in Medicare spending and are prescribed to around 1.8 million enrollees. The goal is to reduce costs for the Medicare program and its beneficiaries by negotiating fairer prices for the most expensive treatments.

2. First-Time Inclusion of Part B Drugs Alongside Key Exclusions: For the first time, the negotiations cover drugs under Medicare Part B — those administered in healthcare settings such as doctors' offices — marking a notable expansion of the program. Orencia, Cimzia, and Botox fall into this category. However, two widely used and expensive cancer immunotherapies, Keytruda and Opdivo, were unexpectedly left off the list due to legislative delays introduced by the One Big Beautiful Bill Act. Their inclusion has been postponed by at least a year, reflecting ongoing political and regulatory complexities in drug pricing reform.

3. Limited Financial Impact but Ongoing Industry Backlash: While the negotiated price cuts are expected to have only a modest financial effect on most drugmakers — with projected exposure at or below 3% of total revenue — Gilead’s Biktarvy stands out, potentially affecting up to 8% of its 2027 sales. Despite the limited immediate impact, the pharmaceutical industry, represented by the Pharmaceutical Research and Manufacturers of America, has voiced strong opposition. Critics argue the policy could deter investment in innovative treatments, especially small molecule drugs, which are subject to earlier