Trump Signs First Major PBM Reform in Decades

New law aims to protect patients and pharmacies from PBM practices

Feb. 3, 2026 at 6:23pm

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President Donald Trump has signed into law the first meaningful federal reforms to pharmacy benefit manager (PBM) practices in decades. The new law requires the Centers for Medicare & Medicaid Services to define and enforce 'reasonable and relevant' Medicare Part D contract terms, promotes transparency by allowing CMS to track payment trends to pharmacies and pharmacy inclusion in PBM networks, and prohibits PBM compensation in Medicare Part D from being tied to the manufacturer's list price of a drug.

Why it matters

Community pharmacies have long warned about the negative impacts of PBM-insurer conglomerates, including rising drug costs, the closure of small-business pharmacies, and reduced patient access to care. This new law aims to address these issues and help reverse these trends.

The details

The new law contains several key provisions, including requiring CMS to define and enforce 'reasonable and relevant' Medicare Part D contract terms, promoting transparency by allowing CMS to track payment trends to pharmacies and pharmacy inclusion in PBM networks, and prohibiting PBM compensation in Medicare Part D from being tied to the manufacturer's list price of a drug.

  • The new law was signed by President Donald Trump on February 3, 2026.

The players

National Community Pharmacists Association (NCPA)

A trade association representing independent community pharmacies.

B. Douglas Hoey

CEO of the National Community Pharmacists Association.

President Donald Trump

The President of the United States who signed the new law.

Centers for Medicare & Medicaid Services (CMS)

The federal agency that will be responsible for defining and enforcing the new 'reasonable and relevant' Medicare Part D contract terms.

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What they’re saying

“Community pharmacy owners are the canary in the coal mine when it comes to federal or state prescription programs. For years, our members and we have been telling anyone who will listen — and worked to convince others who wouldn't listen — about the PBM-insurer conglomerates gobbling up market share, driving up drug costs, crushing small-business pharmacies, and making it more difficult for patients to receive the care they need.”

— B. Douglas Hoey, CEO, National Community Pharmacists Association

“We're grateful to our champions in Congress and to the president for seeing these provisions across the finish line in the face of tremendous pressure by PBM-insurers to maintain the status quo. The pharmacy payment model is changing, and we'll keep fighting to secure the best possible outcomes for independent community and long-term care pharmacies and their patients.”

— B. Douglas Hoey, CEO, National Community Pharmacists Association

What’s next

The Centers for Medicare & Medicaid Services will now be responsible for defining and enforcing the new 'reasonable and relevant' Medicare Part D contract terms, as well as tracking payment trends to pharmacies and pharmacy inclusion in PBM networks.

The takeaway

This new law represents a significant victory for independent community pharmacies, who have long advocated for reforms to address the negative impacts of PBM-insurer conglomerates. By promoting transparency and prohibiting certain PBM practices, the law aims to protect patients, pharmacies, and the overall healthcare system.