PBM Reforms in Appropriations Bill Crack Down

Published: February 5, 2026

A Historic Win for Independent Pharmacies: Federal PBM Reform Becomes Law

For independent pharmacies across the country, this week marks an important moment. After years of tireless advocacy by thousands of community pharmacists, the president has officially signed into law the first meaningful federal reforms to pharmacy benefit manager (PBM) practices in both the federally covered commercial and Medicare Part D prescription drug benefits.

Thank you to our champions in Congress including Representatives Carter, Dingell, Guthrie and Senators Crapo and Wyden; along with all the independent pharmacy owners and staff who fought for this law! Your steadfast support was essential in getting this historic PBM reform across the finish line. This victory is a testament to what we can achieve for independent pharmacy when we work together. We are grateful for your partnership in this long fight and for standing with America’s independent pharmacies.

Thank you to our champions in Congress including Representatives Carter, Dingell, Guthrie and Senators Crapo and Wyden; along with all the independent pharmacy owners and staff who fought for this law! Your steadfast support was essential in getting this historic PBM reform across the finish line. This victory is a testament to what we can achieve for independent pharmacy when we work together. We are grateful for your partnership in this long fight and for standing with America’s independent pharmacies.

This legislation, included as part of the Department of Health and Human Services and Department of Labor funding bill, brings long-overdue fairness, transparency, and accountability to the PBM system that has burdened independent pharmacies for decades. It also represents the first major change to the Medicare Part D program in more than twenty years; a testament to the perseverance and unity of our industry.

“When PBMs can profit more as drug prices climb, patients and taxpayers always lose. This law begins to realign incentives so that doing right by patients and communities is no longer at odds with staying in business as an independent pharmacy.”

“IPC has been proud to stand shoulder-to-shoulder with NCPA, our members, and our partners across the country to push for these reforms. This win proves what’s possible when independent pharmacies speak with one powerful, unified voice.”

Marc Essensa
President and CEO
IPC

What the Reform Achieves

The PBM reform provisions are a direct result of sustained grassroots advocacy and consistent pressure on lawmakers to protect patient access and ensure fair pharmacy reimbursement. Specifically, the new law:

  • Requires CMS to define and enforce “reasonable and relevant” Medicare Part D contract terms. This will help stop PBMs from imposing one-sided or vague contract conditions that leave independent pharmacies vulnerable to retroactive payment cuts or complex clawbacks.
  • Allows CMS to track payment trends and pharmacy participation in PBM networks. For the first time, CMS will monitor how PBMs pay pharmacies, including tracking whether independent and community pharmacies are being fairly included in networks.
  • Creates a new designation for “essential retail pharmacies.” This encourages broader recognition of the role community pharmacies play—especially in underserved and rural areas—in maintaining patient care access.
  • Prohibits PBM compensation from being tied to a drug’s manufacturer list price. This critical reform removes the perverse incentive that drove PBMs to favor higher-priced drugs, helping reduce prescription costs for patients and taxpayers alike.
  • Requires all private sector self-funded PBM contracts, including ERISA and Labor plans to have:
    • PBM Full rebate pass through to health plans
    • Mandatory PBM reporting to plans and insurers on drug spending
    • Group health plan notice requirements of PBM information to participants and their right to detailed information (including spread pricing)
    • Penalties for violations

Together, these changes crack open the PBM black box that’s long hidden behind complex contracts and opaque pricing models. For years, independent pharmacies have called for exactly this type of accountability, and now, it’s finally law. IPC would like to extend our deepest thanks to those champions in Congress and the President for pushing these provisions forward!

“This is the turning point independent pharmacy has been fighting for. For too long, PBM practices have undermined the sustainability of neighborhood pharmacies and put patient access at risk. These reforms are a critical first step toward a payment model that recognizes the value of the care our members provide every day.”

Mark Kinney
Executive Vice President of Government Relations
IPC

Why It Matters for Independent Pharmacies

For IPC members and independent pharmacists nationwide, the passage of this legislation is more than policy, it’s personal. Every pharmacy owner who took time to contact their legislator, share their story, or engage their patients made a difference.

This reform lays the groundwork for a more balanced future where independent pharmacies can compete fairly, continue providing high-quality care, and stay viable in communities that depend on them. While much work remains to ensure these reforms are properly implemented and enforced, this milestone proves what can be achieved when the independent pharmacy industry speaks with one voice.

What Comes Next

As the Centers for Medicare & Medicaid Services (CMS) develops and enforces these new provisions, IPC will continue tracking implementation details and providing members with updates, resources, and advocacy tools.

We encourage all members to stay engaged, continue sharing your experiences with lawmakers, stay connected through IPC communications, and support ongoing advocacy to strengthen and expand these reforms beyond Medicare Part D.

For the self-funded PBM mandates, the US Department of Labor has proposed regulations to implement these provisions and other accountability standards on PBM’s.

This victory belongs to every pharmacy and every patient who refused to accept the status quo. Together, we’ve proven that persistence, partnership, and purpose can deliver real change.