A trio of U.S. Senators—Marsha Blackburn (R-TN), Maggie Hassan (D-NH), and Mark Warner (D-VA)—introduced the Patients Before Middlemen (PBM) Act on Thursday, targeting the opaque practices of pharmacy benefit managers (PBMs) in Medicare Part D.
Joined by co-sponsor Sen. James Lankford (R-OK), the lawmakers aim to slash prescription drug costs for seniors by decoupling PBM pay from drug prices and ensuring all pharmacies get a fair shot at serving patients.
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PBMs, the third-party middlemen managing drug benefits for health plans, have long been criticized for driving up costs. “For too long, middlemen have taken advantage of misaligned incentives in the pharmaceutical supply chain at the expense of taxpayers and seniors,” Blackburn said.
The bill seeks to dismantle a system where PBMs profit more from pricier drugs, a setup Hassan called exploitative. “Seniors shouldn’t have to choose between paying for essential medications and other basic needs,” she said, touting savings for both patients and taxpayers.
Warner zeroed in on the squeeze felt by seniors and local pharmacies. “PBMs continue to contribute to this phenomenon by keeping drug prices high and reimbursements for local pharmacies low,” he said.
The legislation would bar PBM compensation from tying to drug prices, rebates, or utilization—shifting them to flat service fees—and mandate that Medicare Part D plans contract with any willing pharmacy meeting reasonable terms, a boon for independents often sidelined by selective networks.
The PBM Act tackles multiple fronts. It prohibits price-linked PBM pay starting in 2028, forcing transparency with annual reports on drug costs, rebates, and fees. It also designates “essential retail pharmacies” in rural and underserved areas, ensuring their viability, and sets up an enforcement system where PBMs must disgorge excess earnings to the Department of Health and Human Services.
For pharmacies, it guarantees equitable contract terms, with a process to challenge violations and protections against retaliation.
The backdrop is stark: PBMs, meant to curb costs, often steer plans toward expensive drugs to boost their cut—typically a percentage of list prices—while rural pharmacies struggle under low reimbursements.
“Seniors on fixed incomes can’t afford to be taken advantage of by middlemen who don’t contribute to quality of care,” Warner said. The bill’s bipartisan heft signals a rare Senate consensus on reining in a $400 billion industry long accused of opacity.
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Set to amend the Social Security Act, the legislation rolls out over years—key provisions kick in by 2028, with the HHS Secretary tasked to define “reasonable” contract standards by 2027.
It’s a direct shot at reforming Medicare Part D, which serves over 50 million Americans, amid broader drug-price battles. Blackburn framed it as putting “patients before the profits of pharmacy benefit managers,” while Hassan urged swift passage to ease Granite Staters’ burdens.
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