7 takeaways from the MHE webinar on PBM reform and transparency

Managed Healthcare Executive, along with Pharmacy Times, The American Journal of Managed Care and the Pharmacy Benefit Management Institute, hosted a webinar today titled “A Look at PBM Reform and Transparency: Payer, Provider and Patient Impact." The webinar featured a conversation among three panelists with three different vantage points on pharmacy benefit managers (PBMs): Robyn S. Crosson, vice president of government relations at Navitus Health Solutions, a midsize PBM that bills itself as a transparent alternative to the large PBMs; Elizabeth Mitchell, president and CEO of the Purchaser Business Group on Health (PBGH), a trade group for large, self-insured employers; and Kathy W. Oubre, M.S., CEO of Pontchartrain Cancer, a community oncology practice outside of New Orleans. Ron Lanton III, senior partner and strategist at Lanton, Lanton, and Sosa, moderated the discussion.

With transparency comes leverage, and employers can be pickier

PBMs, especially the “big 3” — CVS Caremark, Express Scripts and Optum Rx — have kept employers at arm’s length, obscured their business practices and built their profit margins on the rebates paid to the PBMs by the drugmakers. Because of PBM reforms dating back to the Consolidated Appropriations Act, 2021, but especially the wide-ranging provisions in the Consolidated Appropriations Act, 2026 (CAA 2026), the panelists agreed it is changing. PBMs are going to be required to disclose much more information about drug costs and their compensation to payers, such as the large “jumbo” employers that Mitchell’s group represents. Mitchell

noted that starting in 2028, PBMs will be required to share drug-level data in regular reports to the employers that they contract with and pass through all rebates and discounts. She said the 2026 law also clarified that the PBMs are “covered service providers” under the Employee Retirement Income Security Act of 1974 that governs self-insured employers. “Employers and public purchasers are really embracing these new standards and expectations,” Mitchell said. “They are changing how they’re contracting and really seeking to be effective fiduciaries. And these new requirements enable that.” Crosson made a similar point. “PBMs, like it or not, they’re being forced now to provide the information that plan sponsors need to actually make good judgment in what plans they pick, and this enables them to really pick a partner instead of just a vendor.” Crosson said later power has shifted to the plan sponsors and employers. “the people cutting the check.” Oubre said the self-insured employers are asking more questions because of the PBM reforms.

With fiduciary responsibility comes liability

Under ERISA, self-insured employers have always been fiduciaries, Mitchell noted, but tweaks in the law have underscored the responsibility and made individuals liable if pharmacy benefits are not managed appropriately. “The SVP [senior vice president] of benefits could be named in a lawsuit, and it’s not enough to now say, ‘Oh, well, my advisor thought this was a good idea or my PBM told me to do this. Individuals are now being held to an expert standard, so there are liability and accountability.” Mitchell noted that even large, sophisticated employers have depended on brokers and consultants to make decisions about PBMs and that while in many cases those arrangements work out well, disclosure requirements have shown that in some cases those outside advisors haven’t worked in the best interest of the employer or plan sponsor. “It becomes even more incumbent on the employer to have neutral, unconflicted advice that is truly just in the interest of the plan,” Mitchell said during the webinar.

Transparent PBMs are catching on

Mitchell said that 27% of PBGH’s members have moved their PBM business over to smaller transparent PBMs and that another 21% to 22% are putting their PBM business out to bid this year. Crosson said that Navitus has been in business for 24 years and that it was the “weird kid in the lunchroom” with its promise of being fully transparent and passing through rebates. Crosson said that Navitus has doubled its business in the past five years.

Expect some PBM maneuvers around the new requirements

Both Oubre and Mitchell had some heightened suspicion of PBMs and how they might maneuver around the new reporting and transparency requirements in the CAA, 2026. Oubre said she expected PBMs to shift to “new administrative fees or newly labeled clinical management charges” that are not explicitly covered by the new reporting requirements. She referenced how one of the large PBMs — she didn’t name it — had tried to circumvent reimbursement rules for pharmacies with a bonus pool fee. “I expect more continued vertical integration and also reclassification of specialty drug categories and even more step therapy and narrowing of formularies,” Oubre said. “I know I am the little black cloud right now.” Mitchell said statements made in earnings calls about changes to PBM practices while staying whole “makes you wonder where the money is going to come from.” Mitchell echoed Oubre’s statements that PBMs may start to

rely on administration for revenues as pass-through rules take effect. She also said certain forms of indirect compensation may not get reported “because we saw that certainly with brokers and consultants” when they were hit with disclosure rules. Crosson noted that definitions of fees are getting broader. She said that plan sponsors can limit abuse of the rules by being vocal and asking questions.

Direct-to-consumer sales have some benefit, but…

The panelists expressed mixed feelings about DTC sales. Oubre said the direct-to-consumer (DTC) sales would “route patients around the PBM,” but that patients may not realize that the sales are not covered by their insurers. She said DTC sales may help people afford some drugs but that they aren’t meaningful when it comes to the “specialty oncolytics and biologics that drive financial toxicity in cancer care.” Crosson said that DTC sales at lower prices have benefits, and she specifically mentioned fertility drugs that are often not covered by plan sponsors. But she also had reservations about patients buying and taking drugs without management by a doctor, insurer, or PBM. Mitchell said that her organization is “supportive of any innovation that enhances access to needed drugs,” noting that one of her members (she didn’t identify the company by name) had a DTC program for glucagon-like peptide 1 (GLP-1) drugs prescribed for obesity.

Next up, 340B

PBM regulation and reform were talked about for years in Congress, and after several near misses, it finally made its way into the CAA,2026, and the law in February 2026. Oubre suggested that the 340B Drug Pricing Program may be the next line for reform that will affect payers, health systems and, ultimately, patients. She mentioned several bills. “Everyone talks about Congress kind of being that slow-moving ship, but once they set their sights on you, you’re in their sights.” Mitchell said employers favor greater transparency, especially as it relates to their spending. She noted that data available on hospital pricing and insurance payment transparency rules have shown large variations in prices paid for the same drug. Mitchell said 340B has become distorted beyond its original purpose and is “driving up costs in a way that was never intended." Crosson noted that 340B can work to the disadvantage of employers because drugmakers don’t pay rebates on drugs paid for through the 340B program.

PBMs, show me your value

“The industry is simply not working for those who pay for and receive care,” said Mitchell about PBMs. “No one gives up wild profits easily. And it is now so consolidated, vertically and horizontally, that making change is not for the faint of heart.” Still, in response to Lanton’s question whether reform was

happening too late, Mitchell said it wasn’t. Oubre said she was hopeful that PBMs would become “less like an opaque, vertically integrated profit center and more like a transparent claims administrator.” Mitchell quipped. “I want to sign up for Kathy’s future because I couldn’t agree more.” Crosson was not completely on board with that slimmed-down version of PBM activity. Crosson said it was best for PBMs to see employers as partners, not as “cash cows.” PBMs are going to have to “show their value and defend their worth,” she said. “I think the way they stand out is clinical,” said Crosson. “It’s by enhancing the care, by enhancing the outcomes and serving as a partner. I think that has to be the PBM of the future.”