Democratic Health Leaders Urge EBSA to Go Further to Increase Transparency for Health Care Middlemen

Democratic Health Leaders Urge EBSA to Go Further to Increase Transparency for Health Care Middlemen

WASHINGTON - Today, Democratic House health leaders urged the Employee Benefits Security Administration (EBSA) to further strengthen its proposed rule regarding pharmacy benefit managers (PBMs). PBMs are middlemen who manage prescription drug benefits on behalf of health plans. The proposed rule partially implements longstanding recommendations of Committee Democrats to require middlemen disclose their direct and indirect compensation.

The letter was sent by Ranking Member Robert C. "Bobby" Scott (VA-03), House Committee on Education and Workforce, and Ranking Member Mark DeSaulnier (CA-10), House Subcommittee on Health, Employment, Labor, and Pensions.

The members emphasized that while the proposed rule is a meaningful step forward, it does not address a vast array of middlemen and service providers whose hidden fees and conflicts of interests raise costs for workers and their families. The members argued that the rule should be expanded to include fully insured plans and to require transparency from other service providers, such as third party administrators. The members also insisted that the Department take into consideration privacy protections in the final rule.

"The Proposed Rule is a significant step forward that incorporates several ideas to increase transparency that were previously included in legislation supported by Democrats on the Committee on Education and Workforce," wrote the members. "We encourage the Department to move forward with these aspects of the Proposed Rule, while taking additional action to further strengthen its provisions to lower costs for workers and their families."

The proposed rule is another step in efforts to improve PBM transparency and lower drug prices. In 2022, Representatives Scott (VA-03) and Foxx (NC-05), sent a letter urging the Employee Benefits Security Administration (EBSA) to issue guidance to ensure PBMs and other service providers disclose their compensation and potential conflicts of interest.

And last year, Representatives Courtney (CT-02) and Houchin (IN-09) reintroduced the Hidden Fee Disclosure Act to shine a light on the opaque prescription drug pricing system and the fees charged by health plan service providers to ensure patients get a fair deal. In 2023, the House passed a previous version of this bill (320-71) as part of the Lower Cost, More Transparency Act.

To read the full letter, click here.

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