New federal PBM transparency mandates include $10K-per-day fines for employers

The new laws say nothing about which entity will actually pay the fines.

"It's possible that PBMs will insert new indemnification provisions shifting any penalties imposed on PBMs to plan sponsors," Bibb wrote in her analysis.

What it means: Bibb recommended that employers have PBM service contracts checked carefully, to see whether PBMs have included indemnification provisions requiring the employers to pay any fines related to the new transparency mandates that the PBMs have incurred.

Employers will also have to verify whether the PBMs will take responsibility for any penalties the employers end up owing because of the PBMs' failures to provide the information that the employers need to comply with the rules, Bibb said.

The backdrop: PBMs help employers manage prescription drug benefits for self-insured health plans, and they help insurers manage the prescription benefits included with fully insured group health insurance coverage.

Congress put the PBM laws in the new Consolidated Appropriations Act 2026 spending package.

Related: PBM transparency mandates come to life in $1.2T House spending package

The package included $1.2 trillion in federal agency and program funding, ended a partial shutdown of federal government operations, and included two PBM provisions long sought by pharmacies and drug manufacturers.

PBM law basics: One employer plan provision in the CAA 2026 packages requires PBMs to pass all rebates and other discounts they get when negotiating prescription drug prices through to the employer plan sponsors and employer plan participants.

Another employer plan provision requires the PBMs to send detailed prescription benefits reports to the employer plan sponsors. The provision also requires employer plan sponsors to make prescription benefits plan summary data available to the plan participants and to send the participants a notice informing them about the availability of the plan-level summary information.

An employer plan, insurance carrier or PBM could owe the $10,000-per-day "civil monetary penalty" if it fails to provide the required information, Bibb wrote.

A plan, insurance carrier or PBM would owe the $100,000-per-item penalty if it knowingly provides false information.

Fines and civil monetary penalties: The federal government uses the word "fine" to refer to the amount a criminal defendant pays in connection with a conviction for a violation of a federal law. The government uses the term "civil monetary penalty" to refer to the amount that a defendant in a civil suit filed by the federal government ends up paying.

From the perspective of the employer or defendant owing a big civil monetary penalty, the penalty is a painful fine.

"Good faith efforts": The new CAA 2026 transparency requirements for employers include a provision that will let an employer avoid paying a fine if it can show that it made a "good faith effort" to comply with the requirements.

"Plan sponsors will want to ensure they document their good-faith efforts to provide the required notice and plan-level summary information," Bibb wrote.