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Pharmacy benefits managers “contribute to the skyrocketing cost of healthcare” … which is a top challenge for manufacturers, especially for small and medium-sized firms, the NAM told the House Education and Workforce Subcommittee on Health, Employment, Labor and Pensions ahead of a recent hearing examining PBMs’ business models. 

What’s going on: PBMs are underregulated middlemen that design, negotiate and administer prescription drug benefits for employers. But “instead of helping manufacturers’ health plans manage costs, there is growing evidence that PBM business practices actually increase them.”

• Instead of managing costs for manufacturing employers, PBMs “contribute to the skyrocketing cost of healthcare by pocketing [drug] manufacturer rebates, tying patient cost-sharing to list prices, using spread pricing structures and obfuscating their questionable business models,” the NAM told the subcommittee. 

Why it’s important:  “[Health] benefits are an effective tool to attract and retain employees and to maintain a healthy and productive workforce,” the NAM noted. Further, “[m]anufacturers know that keeping employees and their families healthy is the right thing to do for the workers who keep America and its economy strong.

• Even with ever increasing healthcare costs, “95% of manufacturing employees are eligible for health insurance benefits … which underscores the urgent need for action to reduce healthcare costs for manufacturers and manufacturing workers alike,” the NAM continued. 

Progress made: Recently, and with the NAM’s strong support and continued advocacy , policymakers in Washington took two monumental steps forward: Congress passed PBM reforms, included in the Consolidated Appropriations Act of 2026, and the Department of Labor released a draft rule to require robust disclosures to health plan sponsors.  

More to do: Manufacturers know all too well that “PBMs are adept at changing their business practices to avoid oversight of their concerning models … [and will likely] attempt to evade the scope of the CAA and the DOL rule,” the NAM told the subcommittee.

• In addition to targeted reforms including “delink[ing] PBMs’ compensation from drug list prices in the commercial market,” Congress and the administration should therefore keep monitoring PBM business practices and activities “to determine if laws or regulations need to be updated or if additional laws and regulations are needed,” the NAM concluded.