States target pharmacy benefit managers in effort to lower prescription drug prices

Jun 27, 2026

As U.S. consumers struggle with medication costs, states are passing laws to rein in pharmacy benefit managers (PBMs). Measures in Kansas, Louisiana, and Tennessee aim to set minimum dispensing fees and restrict PBM-owned retail pharmacies. CVS Health Corp. and industry allies are fighting back, spending over $24 million on advertising and filing federal lawsuits to block these state-level restrictions.

State PBM regulation efforts

▪Lawmakers in at least 26 states introduced more than 120 bills targeting pharmacy benefit managers in 2026, with about a quarter of those bills clearing at least one legislative chamber.
▪A Tennessee law will bar pharmacy benefit managers from operating retail pharmacies as of July 1, 2028.
▪Legislators in at least a dozen states passed laws in 2026 to limit compensation to pharmacy benefit managers, set minimum payments to pharmacists, and require more information disclosure.

Prescription drug affordability concerns

▪A poll by the healthcare research nonprofit KFF found that about 4 in 10 U.S. adults did not take medications as prescribed within the previous year due to costs.
▪A poll by the healthcare research nonprofit KFF found that about 6 in 10 U.S. adults were at least somewhat worried about being able to afford their prescriptions.

CVS legal challenges

▪CVS Health Corp. filed a federal lawsuit in Tennessee to avoid closing its 136 pharmacies in the state under a law taking effect on July 1, 2028.
▪CVS Health Corp. settled three lawsuits in Louisiana accusing the company of unfair trade and deceptive practices in lobbying, agreeing to pay $45 million without acknowledging wrongdoing.
▪CVS Health Corp. sued Arkansas in 2025 after the state enacted legislation targeting pharmacy benefit managers, and a federal judge subsequently blocked the law.

Independent pharmacy financial pressures

▪A Louisiana law imposes an $11.81 dispensing fee on pharmacy benefit managers and mandates that they operate for the benefit of health-insurer clients and plan enrollees.
▪A Kansas law will require pharmacy benefit managers to pay a $10.50 dispensing fee per prescription to help offset low reimbursements to independent pharmacies.

PBM industry defense

▪Drug companies, pharmacy benefit managers, and their allies spent at least $24 million on opposing broadcast and digital advertising since the start of 2025.
▪Pharmacy benefit managers claim credit for an increased use of less-expensive generic drugs, which now make up 90% of U.S. prescriptions.

Federal PBM regulations

▪Congress passed regulations in February 2026 preventing pharmacy benefit managers from keeping negotiated rebates on drug prices for health plans supplementing federal Medicare coverage.