NCPA Shaping Regulatory Language Around PBM Reform Law

ALEXANDRIA, Va. (July 23, 2026) – The National Community Pharmacists Association (NCPA) this week sent a letter to the Centers for Medicare & Medicaid Services (CMS) responding to the agency’s request for information as it starts to write rules implementing the landmark pharmacy benefit manager reform passed earlier this year.

“The rulemaking process is critical because that’s where the rubber meets the road,” said NCPA CEO B. Douglas Hoey. “CMS is writing the rules that will implement what Congress intended when it passed PBM reform. We know the PBMs will try to have loopholes inserted into the rules, so we are working with CMS to ensure the rules are clear and tight.”

CMS published a request for information asking interested parties to comment on PBM compensation, a focus of the new law. In its letter, NCPA focused on three key questions: what is a PBM and a PBM affiliate, how should PBMs be paid, and how should independent community and long-term care pharmacies be reimbursed.

A PBM should be defined by its behavior, not by its own corporate jargon, according to NCPA. That way, PBMs can’t escape regulation by hiring their own subsidiaries or affiliates to perform what are essentially PBM services. In other words, if it looks like a PBM and acts like a PBM, it’s a PBM.

NCPA strongly supports the new law that PBMs should be paid based on a simple administrative fee in Medicare Part D. Their compensation should not be tied to giant rebates they get from drugmakers or the list price of drugs. That arrangement creates a massive conflict of interest and an incentive to inflate the price of drugs.

NCPA also urged CMS to clarify that PBMs must reimburse independent pharmacies for their cost of acquiring the drugs, plus a dispensing fee based on objective data, plus a fee for pharmacist-provided professional services. Pharmacy reimbursements are currently based on whatever PBMs claim they should be, based on criteria the PBMs do their best to hide or obscure.

“This is a chance to restore PBMs to their original purpose, which is to help make the prescription payments easier for employers, unions, and patients,” said Hoey. “They were never intended to control every aspect of patient care, including overruling the medical decisions of doctors and pharmacists. But vertical integration has allowed them to grow into monopolies with massive power. As their market share has grown through consolidation and by suffocating smaller competitors, they’ve abused their market power to increase their profits at the expense of taxpayers, employers, and health care providers.”

CMS will publish multiple requests for information during this process, including one that focuses on Congress’ mandate that CMS shall develop and enforce a definition for reasonable and relevant contract terms.

“We look forward to working with CMS as this process advances, and we are grateful for the opportunity to comment during this initial stage,” said Hoey.