Hidden Fee Disclosure Act of 2025

Key Points

• This bill requires companies that manage employer health plans, including pharmacy benefit managers and third party administrators, to disclose all compensation they receive, broken down by individual service rather than lumped together.
• Pharmacy benefit managers must reveal hidden revenue streams like rebates from drug makers, spread pricing profits (charging the plan more than they pay the pharmacy), and fees from administering rebates or providing drug data to manufacturers.
• Third party administrators running group health plans must also disclose rebates, discounts, and fees from providers, along with money recovered from overpayments, billing errors, fraud, and subrogation, including how much they keep.
• PBMs and TPAs must provide annual written disclosures to plan fiduciaries within 60 days of each plan year, detailing total gross and net drug spending, fees from all sources, and cost-sharing amounts collected from pharmacies.
• The new disclosure rules apply only to contracts entered into, extended, or renewed on or after January 1, 2026, meaning existing agreements are grandfathered until they come up for renewal.
• The Department of Labor must issue rulemaking within one year of enactment to set standards for how service providers report their expected compensation, while all disclosures must comply with HIPAA privacy rules.