The Service Line

Reimbursement: Washington has now written down what a pharmacy benefit manager is allowed to be paid

Pharmacy benefit managers (PBMs) that run Medicare Part D drug plans would be paid only flat, itemized, fair-market-value fees under a proposed rule the Centers for Medicare & Medicaid Services (CMS) released October 16. The CMS fact sheet for the proposal (CMS-4214-P) says it implements Section 6224 of the Consolidated Appropriations Act, 2026, which covers the remuneration PBMs and their affiliates may receive, and it adds PBM reporting to plan sponsors and CMS plus disclosure of certain manufacturer agreement terms. Law firm analysis from Crowell describes the fees as not tied to drug prices, rebates, formulary placement or volume, with manufacturer rebates exempt from that rule only if 100% of their value reaches the plan sponsor, and puts comments due December 15 with the main provisions applying from plan year 2028. The fact sheet itself gives no savings estimate and no comment date, so check the Federal Register notice. For an independent pharmacy, this is the first federal text that defines what a PBM may keep, and it is the standard your contract audit will be measured against. Confidence: High on the release and subject matter (CMS); Medium on the comment date and fee definitions (law firm summary of the rule text).

Reimbursement: The Labor Department’s PBM fee disclosure rule has cleared White House review

A Labor Department rule requiring PBMs to disclose their compensation to employer health plans has finished review at the White House budget office, according to Law360 on October 21. The article does not say whether the rule is final or when it will publish, and the rest is paywalled. The Employee Benefits Security Administration’s proposal would require disclosure to self-insured plan fiduciaries of expected compensation from manufacturers, spread and pharmacy claw-backs, semiannual reports of what was actually received, and audit rights. Employers who hold those audit rights will soon be able to see the gap between what they paid and what the pharmacy was reimbursed. Expect more questions at your next contract renewal. Confidence: Medium, one secondary report on a clearance, no published final text yet.

Enforcement: CVS’s $315 million controlled-substance settlement is a checklist for every dispensing pharmacy

CVS agreed to pay $315 million to resolve Justice Department allegations that its pharmacies filled controlled-substance prescriptions illegally and billed Medicare and other federal programs for them. The Justice Department announcement of October 13 describes filling from October 17, 2013 through December 2, 2025, with excessive opioid quantities, early refills, so-called trinity combinations of an opioid, a benzodiazepine and a muscle relaxant, and fills for suspected pill mill prescribers. It also alleges that pharmacists ignored red flags because of performance metrics, incentive pay and staffing policies. CVS signed a memorandum of agreement with the Drug Enforcement Administration requiring a reporting hotline, proactive monitoring of dispensing patterns and a process for evaluating suspect prescribers. The claims are allegations only, and there was no determination of liability. For any pharmacy, the compliance questions are now concrete: who reviews trinity fills, and does your staffing let them? Confidence: High on the settlement terms (Justice Department).

Who’s Buying: The three big wholesalers have spent more than $20 billion buying into physician practices

Drug Channels Institute projects $933 billion in 2026 revenue for the Big Three drug wholesalers, with growth slowing to mid-single digits. In its trends analysis, published October 14, Adam Fein reports the largest wholesalers have spent more than $20 billion on stakes in physician management services organizations, five customers (CVS Health, Cigna, Walgreens, Walmart, UnitedHealth Group) are projected to account for over 40% of distribution revenue, and the two remaining national drugstore chains have closed more than 3,000 locations since 2018. He also expects Medicare negotiated prices for Part B drugs, starting in 2028, to cut provider reimbursement. Why it matters: the company that sells your specialty drugs may also own the practice across town, and that changes who captures the margin on provider-administered biosimilars. Confidence: High on the figures as published by the institute; Medium on the projections (analyst forecasts, not audited).

Clinical Policy

The scan found no new utilization or staffing policy shift this week that had not already been covered in the October 10 issue.

The Operator Metric: 69%

69% of benefits leaders in a new survey included at least one non-Big Three PBM in their most recent request for proposals, even as satisfaction with those alternatives fell. The Pharmaceutical Strategies Group report, summarized by Drug Channels on October 20, surveyed 250 benefits leaders covering about 144 million lives. Satisfaction among non-Big Three customers fell to 7.3 from 7.9 on a 10-point scale, while Big Three customers rose to 7.1 from 6.8, so the gap has nearly closed. In a separate National Alliance survey cited in the same post, the Big Three share among respondents fell to 54.3% from 63.4%, though the samples differ and these are survey shares, not market shares. The article notes the data do not prove clients were happier after switching. If you sell to employers, ask which PBM sits in their next RFP and what they will audit. Confidence: Medium, survey data with changing samples.