Every PBM contract has a line for what the plan pays the PBM. For most employers, that is the only number they ever see. The PBM gets paid at least five other ways, and until now, none of them had to show up on paper.

That is about to change. On October 29, the Department of Labor finalized a rule that makes pharmacy benefit managers disclose, in dollars, every way a self-funded health plan pays them. Level-funded plans count. The first disclosures reach employers in 2027.

Most coverage of the rule walks through what it requires. This article follows the money instead: the six ways a PBM gets paid, which of them you can see today, and where each one shows up once the rule applies to your plan.

Six Ways a PBM Gets Paid

A PBM sits between your plan, the pharmacies and the drug makers, and money moves in all three directions. (If you want the bigger picture on why pharmacy costs keep climbing, start with The Prescription Drug Machine.) Here is where the PBM's share comes from.

One of six revenue streams visible today. All six once the rule applies to your plan.

The rule also asks for the net price of every drug on the formulary, after rebates. That is the number that tells you what a drug really costs your plan, and it is the one most employers have never seen.

Follow One Prescription

Here is how three of those streams can hide inside a single generic prescription. The numbers are round and illustrative, chosen for clean arithmetic.

The PBM pays the pharmacy $25, keeps a $15 spread, and weeks later claws back $2 of the pharmacy's $25. Illustrative figures, not a benchmark.

On a claims report, that is a $40 generic. Nothing else shows. The PBM earned $17 on it, and the plan had no way to know. Under the rule, each of those three numbers gets its own line. Multiply one prescription by every fill in a plan year and you can see why the disclosure matters more than the headline fee.

Brand drugs work differently. There, the money usually moves through rebates and fees from the drug maker. The rule makes the PBM show, drug by drug, how much of that money came to your plan and how much it kept.

Three Documents, Three Different Jobs

The rule does not hand you one report. It hands you three, each on its own clock.

The report is where the disclosure gets tested. Here is the kind of comparison it makes possible.

Illustrative figures and layout. The rule sets what has to be reported, and the 5% trigger. The shaded row crosses it, so the PBM owes an explanation.

A row like the shaded one is the start of a conversation, not the end of one. Maybe a new drug launched and rebates rose with it. Maybe the PBM kept more of them than it promised. The explanation tells you which, and the audit lets you check it.

Does the Rule Apply to Your Plan?

It depends on two things: how the plan is funded, and how many employees the company has. Employees, not people on the plan. A company with 150 employees and 80 enrolled is in.

That last row matters for a lot of mid-size employers. If you are fully insured with 100 or more employees, the rule is one more input to the funding conversation. A level-funded plan gets the disclosure. A fully insured plan does not.

When Does It Reach Your Desk?

Two dates confuse people. The law took effect in February 2026, so part of this is already owed. The detailed rule starts later, on your plan year.

"About" dates assume the disclosure arrives 90 days before renewal, the timing DOL calls reasonable.

Watch the contract term. Many PBM contracts run three years. One signed this year can run straight into the rule, and its own definitions of "rebate" and "spread" will decide what the plan gets until then.

What the Rule Does Not Do

It does not ban anything. The rule says plainly that it does not prohibit spread pricing. It does not set prices or cap fees. Deciding whether the PBM's pay is reasonable is still the plan fiduciary's job.

Every number in the disclosure also comes from the PBM. That is why the audit right is the most important part of the rule. DOL's own analysis notes the risk that PBMs find new ways to be paid outside what gets disclosed.

Keep the savings in perspective, too. DOL says the rule could lower drug costs by up to $22 billion over 10 years. That is the top of its range. Its primary estimate works out to about $8 billion. The savings go to plans that read the disclosure and act on it.

A disclosure that sits in a drawer does not protect the plan. It only proves the plan had the information.

What to Do With the Disclosure

A disclosure is a document. It does not lower a single claim on its own. The value comes from reading it against the contract and acting on what it shows.

• Ask now. The law already requires a compensation disclosure from your PBM, your administrator and your broker. Ask each one for it in writing. That includes us.
• Count back 90 days. Find your renewal date and put the disclosure date on the calendar. If the contract renews before the rule applies to your plan, write the rule's terms into it now: dollars, drug by drug, quarterly reports, a data file you can analyze, an overage trigger below 5%, and audit rights spelled out.
• Compare promised with paid. When the six-month report arrives, line it up against the renewal disclosure. Any category that ran over needs a reason you can accept.
• Price what the PBM keeps. Retained rebates, spread and clawbacks are compensation. Put them next to the market for the same services before deciding the deal is reasonable.
• Write it down. Record what you reviewed, what you decided and why. That record is what shows the plan was managed in its members' best interest.
• If the disclosure never comes, ask the PBM in writing to fix it. If it has not within 90 days, notify DOL within 30 days after that, then decide whether to keep the PBM and document why.