S. 3345: PBM Price Transparency and Accountability Act

S. 3345, the PBM Price Transparency and Accountability Act, targets the middlemen of the drug supply chain in both Medicaid and Medicare.

Start with spread pricing. That's when a PBM charges a health plan one price for a drug, pays the pharmacy a lower price, and keeps the difference. The bill bans it in Medicaid: for state contracts that take effect 18 months after enactment, PBMs would have to use a pass-through pricing model. Payments would be limited to the drug's ingredient cost plus a dispensing fee, and that money would have to flow through to the pharmacy in full.

To make that enforceable, the bill builds a price-tracking system. HHS would run a monthly survey of retail and certain non-retail pharmacies to set national average drug-cost benchmarks. Pharmacies that take Medicaid drug payments would have to respond — and ignoring the survey, or giving false answers, could draw civil penalties of up to $100,000 per violation.

The Medicare half rewrites Part D's pharmacy rules. Starting with 2028 plan years, drug plans would have to admit any pharmacy that meets their standard contract terms, and those terms would have to be "reasonable and relevant" under standards HHS must write. The bill also defines an "essential retail pharmacy" by distance — the last pharmacy within 10 miles in a rural area, 2 miles in a suburban one, or 1 mile in an urban one — and orders federal reports tracking those pharmacies through 2034.

Finally, the bill tightens what PBMs can earn and what they must disclose. In Part D, PBMs could keep only flat-fee "bona fide service fees" — pay not tied to a drug's price or rebates — and would have to return anything collected outside that. Beginning July 1, 2028, they would file annual reports with drug-level detail on claims, costs, rebates, and how much business they steer to their own affiliated pharmacies. Plan sponsors would get the right to audit them every year.