Letter to the Dept. of Labor on improving transparency into pharmacy benefit manager fee disclosure
Employee Benefits Security Administration
U.S. Department of Labor
200 Constitution Avenue NW, Room N
Washington, DC 20210
The HIV+Hepatitis Policy Institute is a national organization promoting quality and affordable healthcare for people living with or at risk of HIV, hepatitis, and other serious and chronic health conditions. We strongly support the Department of Labor’s proposed rule to increase transparency in pharmacy benefit manager (PBM) compensation and financial arrangements. Greater transparency is essential to improving accountability across the prescription drug supply chain and ensuring that plan fiduciaries have the information necessary to assess the reasonableness of PBM contracts and practices. We urge the Department to finalize and implement this rule without delay, with the recommendations outlined in this letter.
The proposed rule includes several important provisions that improve visibility into PBM practices, including requirements to disclose manufacturer payments and rebates, report on PBM fees and spread pricing, and provide regular disclosures to plans. We also support the requirement that compensation be reported in clear dollar amounts rather than formulas or percentages, which will help ensure disclosures are meaningful and comparable. These are important steps toward addressing longstanding concerns about opaque financial arrangements that can influence formulary design, utilization management, and patient cost-sharing. In 2023 alone, manufacturers paid an estimated $334 billion in rebates to PBMs and insurers, underscoring the scale of financial flows that remain difficult for plans and patients to fully understand.[1]
To ensure the rule fully achieves its goals of transparency, accountability, and patient affordability, we offer the following recommendations:
- Require specific reporting on copay assistance-related programs, including accumulator adjustment programs, maximizers, and alternative funding programs
- Ensure disclosure captures all PBM compensation across affiliated entities, including group purchasing organizations and rebate aggregators
- Expand the scope of the rule to include fully insured plans
- Increase public transparency by making aggregated, appropriately structured data available to researchers and policymakers
- Align the final rule with applicable statutory requirements enacted by Congress, including provisions in the Consolidated Appropriations Act of 2026
Transparency on Copay Assistance and Related Programs
The final rule should adequately address the growing use of copay assistance-related programs, including accumulator adjustment programs, maximizers, and alternative funding programs (AFPs), which can significantly affect patient affordability while generating revenue for PBMs and their partners. We described the mechanics of these programs in greater detail in our comments on the 2025 Notice of Benefit and Payment Parameters. As of late 2024, more than 40 percent of commercially insured lives were in plans that utilize a copay accumulator or a maximizer and 5 percent were using AFPs.[2],[3]
PBMs and affiliated entities increasingly derive value from manufacturer copay assistance without allowing that assistance to count toward a patient’s deductible or out-of-pocket maximum. As a result, patients may face higher out-of-pocket costs over the course of the year, even when manufacturer assistance is available. These practices undermine the intended purpose of copay assistance, which is to reduce financial barriers to accessing needed medications. According to IQVIA, copay accumulator and maximizer programs accounted for $7 billion of copay assistance in 2024.[4]
While the proposed rule references indirect compensation and related financial arrangements, it does not require sufficient, specific reporting on revenue associated with these programs. Without clear disclosure requirements, these practices will remain obscured within broader categories of indirect compensation, limiting the ability of plan fiduciaries to fully assess their impact.
To address this gap, the Department should require PBMs to disclose all compensation and revenue associated with copay assistance-related programs. This should include specific reporting on accumulator adjustment programs, maximizers, and alternative funding programs, as well as any arrangements involving third-party vendors or affiliated entities that administer or benefit from these programs. These disclosures should include total revenue generated from these programs and their impact on patient out-of-pocket costs.
Enhanced transparency in this area is critical to understanding how these practices affect patient affordability and access. Patients managing chronic and serious conditions, including HIV and hepatitis, rely on consistent access to medications and often depend on copay assistance to afford their treatment. When that assistance does not reduce a patient’s cost-sharing obligations as intended, it creates financial barriers that jeopardize adherence and health outcomes. Evidence consistently shows that higher out-of-pocket costs are associated with lower medication adherence and increased rates of prescription abandonment. According to an IQVIA analysis, an estimated 96 million prescriptions were abandoned at the pharmacy in 2024, with an abandonment rate of one in four for prescriptions with out-of-pocket costs above $75. For prescriptions with a final out-of-pocket cost above $250, 54 percent are not picked up by patients, as compared with 7 percent of patients who do not fill when the cost to them is less than $10.[5]
We also encourage the administration to pursue additional rulemaking to address the underlying use of these programs, including ensuring that manufacturer assistance counts toward patient cost-sharing, clarifying that all covered prescription drugs are treated as essential health benefits for purposes of cost-sharing protections, and prohibiting the use of alternative funding programs that shift costs onto patients and recklessly disrupt continuity of care.
Expand Transparency to Capture All PBM Revenue Streams
In addition to copay assistance-related programs, the rule should ensure that all forms of PBM compensation are fully captured and disclosed. PBMs operate through complex networks of affiliated entities, group purchasing organizations, rebate aggregators, and third-party vendors, which can obscure the full scope of financial arrangements associated with pharmacy benefit management.
The Department should clarify that reporting requirements apply to all direct and indirect compensation received by PBMs and their affiliates, including through group purchasing organizations, rebate aggregators, subsidiary entities, and contractual arrangements with third-party vendors, regardless of how such payments are characterized or labeled. This is particularly important given the magnitude of financial flows across the system, including tens of billions of dollars in administrative fees, retained rebates, and other forms of compensation that may not be readily visible to plans.
Without comprehensive reporting across these entities, disclosures may provide an incomplete picture of PBM revenue streams and limit the ability of plans to evaluate whether compensation is reasonable. Ensuring that all compensation is captured and disclosed is essential to achieving the rule’s core objective of transparency and accountability.
Expand Scope to Fully Insured Plans
The proposed rule is currently limited to self-insured group health plans. While this is an important starting point, it leaves a significant portion of the commercial market outside the scope of the rule.
Patients enrolled in fully insured plans face the same affordability challenges and are similarly affected by PBM practices, including formulary design, utilization management, and cost-sharing structures. Expanding the rule’s requirements to fully insured plans would promote more consistent transparency across the market and help ensure that patients benefit from greater accountability regardless of plan type.
This distinction is difficult to justify in the small group market. While the inclusion of level-funded plans is an important step, it creates a divide between similarly situated employers. A significant share of small firm workers are enrolled in level-funded plans, while a comparable share remain in traditional fully insured arrangements. In practice, these plans often rely on the same PBM services and structures, yet only one group would be subject to enhanced transparency requirements. This inconsistency risks leaving a substantial portion of small employers and their employees without access to the same level of visibility into PBM compensation and practices.
Transparency is particularly important in the fully insured market given the increasing vertical integration between insurers and PBMs. In many cases, carriers contract with affiliated PBMs, creating potential conflicts of interest and limiting the effectiveness of traditional arms-length negotiations. In these arrangements, detailed disclosure of compensation and financial flows may be the only mechanism available for fiduciaries to evaluate whether services are being provided in the best interests of plan participants.
Increase Public Transparency
While we support the proposed requirement for PBMs to disclose compensation and fee structures to plan fiduciaries, the rule could be strengthened by establishing a more centralized approach to reporting and oversight. As currently structured, these disclosures are provided only at the plan level, which may limit the Department’s ability to assess broader patterns across the market.
We encourage the Department to require covered service providers to submit these disclosures directly to the Employee Benefits Security Administration in a standardized, machine-readable format. A centralized reporting framework would support more consistent oversight and enable the Department to better identify trends in PBM compensation and contracting practices across plans and markets.
This approach would be particularly important for understanding how PBM compensation structures affect patient affordability, especially for individuals managing chronic and serious conditions. Without a centralized dataset, it may be difficult to assess the prevalence and impact of practices such as copay accumulator programs, maximizers, and related benefit design features that can increase patient out-of-pocket costs. Direct reporting would provide the Department with a more complete view of how these practices are being used and where additional oversight may be warranted.
We also encourage the Department to consider publishing aggregated, appropriately structured data based on these disclosures. While protecting legitimate proprietary information is important, high-level data on PBM compensation and market practices could provide meaningful insight to policymakers, researchers, and stakeholders. Increased public visibility into these trends would support accountability and help inform future efforts to improve affordability and access to care.
Align Requirements with the Consolidated Appropriations Act of 2026
The Department should ensure that the final rule is aligned with applicable statutory requirements enacted by Congress, including provisions in the Consolidated Appropriations Act of 2026. Consistency across regulatory and statutory requirements will support effective implementation, reduce confusion for plans and service providers, and help ensure that transparency improvements translate into more affordable and accessible care for patients.
Conclusion
We support the Department’s efforts to increase transparency in PBM compensation and urge timely finalization and implementation of this rule. Strengthening requirements around copay
assistance-related programs and ensuring comprehensive disclosure of PBM revenue streams will be critical to improving affordability and access for patients.
We thank you for the opportunity to share these comments and look forward to working with you as you seek to make healthcare, particularly prescription drugs, more affordable and accessible for more Americans. If you have any questions or need any additional information, please do not hesitate to reach out to our Government Affairs Manager, Zach Lynkiewicz, at zlynkiewicz@hivhep.org.
Sincerely,
Carl E. Schmid II
Executive Director
[1] Kristi Martin, “What Pharmacy Benefit Managers Do, and How They Contribute to Drug Spending” (explainer), Commonwealth Fund, Mar. 17, 2025.
[2] Adam J. Fein, “Copay Accumulators and Maximizers in 2025: Popular, Profitable, and Problematic,” Drug Channels, February 10, 2026.
[3] Ashley Gallagher, “Use of Copay Offset Programs Expected to Rise | AMCP Nexus 2024,” Managed Healthcare Executive, October 15, 2024.
[4] IQVIA Market Access Strategy Consulting, analysis of IQVIA LAAD 3.0 claims data and Xponent PlanTrak projected data, Patient Out-of-Pocket Costs and Copay Assistance, 2025.
[5] IQVIA Institute for Human Data Science, Understanding the Use of Medicines in the U.S. 2025 (April 2025).