Last month, Arkansas Gov. Sarah Huckabee Sanders signed legislation that bans Pharmacy Benefit Managers (PBMs) from owning or operating pharmacies, effective Jan. 1, 2026.

HB1150 is the first state law to impose this level of restriction and signals growing bipartisan pressure for PBM reform.

Even if your organization operates outside Arkansas, this law marks a broader shift in pharmacy benefit regulation. For HR leaders managing healthcare strategy, it introduces new considerations for vendor accountability, fiduciary oversight and cost containment.

Why PBM Reform Matters to HR

For HR leaders, PBM reform is about reducing fiduciary risk and regaining control over pharmacy spend. As pharmacy costs continue to rise, so do the financial and compliance implications of opaque vendor contracts.

Stronger regulation and oversight can help HR:

• Eliminate hidden fees and spread pricing that inflate employer costs
• Ensure rebates flow directly to the employer rather than being retained by PBMs
• Improve transparency, so employees better understand and trust their benefit options, and
• Strengthen compliance with ERISA by demonstrating clear fiduciary oversight.

These changes are more urgent given recent findings. In early 2025, the Federal Trade Commission reported that “the Big 3 PBMs” – CVS Caremark, Express Scripts and OptumRx – made more than $7.3 billion in excess revenue by marking up specialty generics at their affiliated pharmacies between 2017 and 2022.

Lack of transparency...

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