To require the Secretary of Labor to conduct a study on the fiduciary duties of pharmacy benefit managers.
Sponsors
Legislative Progress
IntroducedMr. Braun (for himself, Ms. Hassan, Mr. Marshall, Mr. Budd, …
Summary
What This Bill Does
This bill directs the Secretary of Labor to study whether pharmacy benefit managers (PBMs) should be treated as fiduciaries under ERISA (the Employee Retirement Income Security Act). The study, due within 2 years, would examine the impacts of requiring PBMs to act in the best interests of health plan participants rather than their own profit motives. It specifically explores prohibiting PBM compensation models tied to drug prices or manufacturer rebates.
Who Benefits and How
Healthcare consumers and employees enrolled in group health plans would potentially benefit if this study leads to policy changes requiring PBMs to prioritize patient interests. Currently, PBMs often profit from opaque pricing arrangements that can increase drug costs. Group health plans and employers sponsoring these plans would gain transparency into PBM fees and potentially lower costs if fiduciary duties were imposed, as PBMs would need to justify their compensation as "fair market value" for actual services.
Who Bears the Burden and How
Pharmacy benefit managers face the primary burden, as fiduciary designation would subject them to disclosure requirements and restrictions on how they can be compensated. Specifically, fees based on drug prices (like wholesale acquisition cost), rebates, or other drug-linked remuneration would be considered "per se unreasonable," forcing a fundamental change to their business model. The Department of Labor must conduct and report on this complex study within 2 years, requiring resources and expertise to evaluate healthcare economics.
Key Provisions
- Mandates a Department of Labor study on classifying PBMs as ERISA fiduciaries within 2 years
- Examines requiring PBMs to make fiduciary disclosures about their fees and services
- Proposes that "bona fide service fees" must represent fair market value for itemized services actually performed
- Would prohibit PBM compensation based on drug prices, wholesale acquisition cost, average wholesale price, or manufacturer rebates
- Preserves PBM ability to retain legitimate service fees compliant with ERISA Section 408(b)(2)
Evidence Chain:
This summary is derived from the structured analysis below. See "Detailed Analysis" for per-title beneficiaries/burden bearers with clause-level evidence links.
Primary Purpose
This bill requires the Secretary of Labor to conduct a study on the fiduciary duties of pharmacy benefit managers and submit a report to Congress within two years.
Policy Domains
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "the_secretary"
- → Secretary of Labor
Key Definitions
Terms defined in this bill
The cost at which a drug is sold by the manufacturer to wholesalers or direct purchasers.
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology