H.R. 7895

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7895 Reported in House (RH)]

<DOC>

Union Calendar No. 634
119th CONGRESS
2d Session
H. R. 7895

[Report No. 119-729]

To amend section 408 of the Employee Retirement Income Security Act of 
1974 to prohibit kickbacks to pharmacy benefit managers.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

March 12, 2026

Mr. Allen introduced the following bill; which was referred to the 
Committee on Education and Workforce

July 2, 2026

Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed 
in italic]
[For text of introduced bill, see copy of bill as introduced on March 
12, 2026]

_______________________________________________________________________

A BILL

To amend section 408 of the Employee Retirement Income Security Act of 
1974 to prohibit kickbacks to pharmacy benefit managers.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``PBM Kickback Prohibition Act''.

SEC. 2. PROHIBITION ON PHARMACY BENEFIT MANAGER KICKBACKS.

(a) In General.--Section 408(b)(2)(B) of the Employee Retirement 
Income Security Act (29 U.S.C. 1108(b)(2)(B)) is amended by adding at 
the end the following:
``(xi)(I) In the case of a contract or arrangement between 
a covered plan and a covered service provider for pharmacy 
benefit management services, no amount of compensation (whether 
direct compensation or indirect compensation) may be paid by 
such service provider to any individual or entity for--
``(aa) the referral, recommendation, placement, 
retention, or renewal of, or access to, the business of 
the covered plan or the health insurance issuer 
offering health insurance coverage for the covered 
plan;
``(bb) inclusion in, participation in, or the 
design of--
``(AA) a request for proposal;
``(BB) a market check;
``(CC) an evaluation;
``(DD) the volume, value, or use of covered 
plan business; or
``(EE) any other contracting process.
``(II) For the purposes of this clause, the 
characterization of compensation shall be based on the economic 
substance and practical operation of the contract or 
arrangement, without regard to the characterization or labeling 
of the compensation by the covered service provider.
``(III) Any compensation paid by a covered service provider 
to a brokerage firm, broker, consultant, advisor, or related 
entity shall be presumed to be related to an activity described 
in item (aa) or (bb) of subclause (I) unless the parties 
demonstrate through contemporaneous written documentation that 
such compensation--
``(aa) reflects fair market value for bona fide 
services actually rendered; and
``(bb) is not related, directly or indirectly, to 
any activity described in such items.''.
(b) Effective Date.--The amendment made by this section shall apply 
for plan years beginning after the date of enactment of this Act.
Union Calendar No. 634

119th CONGRESS

2d Session

H. R. 7895

[Report No. 119-729]

_______________________________________________________________________

A BILL

To amend section 408 of the Employee Retirement Income Security Act of 
1974 to prohibit kickbacks to pharmacy benefit managers.

_______________________________________________________________________

July 2, 2026

Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed