This bill amends federal pension and benefits law under the Employee Retirement Income Security Act (ERISA) to crack down on kickbacks involving pharmacy benefit managers (PBMs), the companies that negotiate drug prices and manage prescription drug benefits for employer-sponsored health plans. Specifically, it prohibits PBMs from paying compensation to brokers, consultants, or other entities in exchange for winning, keeping, or expanding business with a health plan, or for influencing the design of contracts, proposals, or evaluations related to that business. The bill requires that any compensation paid by a PBM to such intermediaries be judged by its real economic substance rather than how it is labeled on paper, closing a loophole that has allowed disguised kickbacks. It also creates a legal presumption that such payments are improper unless the parties can prove, with contemporaneous written records, that the payments reflect fair market value for genuine services and are unrelated to steering business. This mainly affects employers offering health plans, insurance brokers and consultants, and PBMs, and the new rules would take effect for plan years beginning after the law is enacted.
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