Employers are heading into a year in which drug costs are set to outpace every other line of health spending, and a new scoring framework gives benefits brokers a specific set of questions to run through before recommending a pharmacy benefit manager.
Business Group on Health projects a 12% rise in drug costs for 2026, against 8.5% for healthcare costs overall, with pharmacy already making up roughly a quarter of employer health spending.
A previous Business Group on Health survey found that 41% of employers were either switching pharmacy benefit managers or running a request for proposals.
The framework, called Contract X-Ray, scores a PBM contract against 10 provisions grouped into fiduciary conduct, financial integrity, and oversight and control, giving brokers a checklist to run against a client's contract rather than a PBM's own description of its model.
Fiduciary conduct asks whether the contract records the plan sponsor's own responsibilities, and whether the PBM avoids steering prescriptions toward pharmacies it owns for its own gain.
Financial integrity asks whether manufacturer payments and other value flow through to the plan, whether rebates are fully disclosed, and whether administrative fees are itemized rather than lumped together.
Oversight and control asks who owns the plan's data, what audit rights exist, whether the employer can bring in outside pharmacy or clinical vendors without penalty, whether formulary decisions are built around the lowest net cost among appropriate therapies, and whether a plan can exit the contract without running into contractual barriers.
What happens when a contract skips most of those questions has already shown up in one review, where a PBM contract scored through the framework came back with an overall score of 29 out of 100, with all 10 provisions rated fail or concern.
"In one recent contract reviewed through the third-party framework, 10 of 10 measures were rated fail or concern with an overall score of 29 out of 100," said Renzo Luzzatti, chief executive of US-Rx Care. "The largest gaps involving rebate administration and pharmacy network pricing."
US-Rx Care said its own contract scored close to 100% under the same framework.
Contract X-Ray is built and maintained by Nautilus Health Institute, a nonprofit that scores contract language rather than the PBMs that write it. Nautilus has said its tool has reviewed 37 plan sponsor contracts, and none has reached its "Good" tier. Contracts built around transparent, pass-through pricing average 92 on the same scale, according to Nautilus, while contracts built around spread pricing average 32.
A checklist like that fills a gap brokers have flagged in their own advisory work. Just 12% said they were very confident their clients had adequate fiduciary processes in place, according to the 2026 Phia Group Broker Survey Results & Analysis, based on 124 brokers and advisors.
Rate increases and pharmacy costs dominate what employers raise with their brokers, while fiduciary oversight rarely comes up unprompted, even though 76% said their book of business had shifted toward self-funded plans over the past year.
Asked what would help most, brokers put fiduciary oversight checklists top of the list, chosen by 54%.
Read more: Benefits brokers see fiduciary gaps clients aren't asking about yet, survey finds
The gap those brokers describe has already reached the courts, with mixed results so far.
Johnson & Johnson was sued in 2024 by employees who alleged the company breached its fiduciary duty in choosing and monitoring its PBM, one of the first ERISA fiduciary claims aimed at a health plan rather than a retirement plan.
A New Jersey court dismissed those claims twice, most recently in November 2025, ruling the plaintiffs lacked standing to sue.
A similar case against JPMorgan Chase has gone differently, with a judge denying a motion to dismiss a prohibited-transaction claim over what the plan paid its PBM, letting that claim move forward.
Federal disclosure rules add a timing element. Under the Consolidated Appropriations Act, 2026, PBMs will eventually have to give plan sponsors a fuller accounting of how spread pricing, rebates, and overall cost structures work in practice, though that requirement does not take hold until January 2029.
Bryn White, an employee benefits attorney, has pointed out that the law leaves open who reviews that data once it arrives, since plan sponsors carry the fiduciary duty to interpret it but often lack the background to spot a spread-pricing anomaly on their own.
Because PBM contracts typically run around three years, White has noted that renewals being negotiated now may already fall inside the 2029 deadline, which means terms locked in at this year's renewal could still be in force when the new disclosure rules take effect.
Read next: PBM transparency data is coming, but does anyone read it?
Luzzatti said disclosure and fiduciary alignment should not be treated as interchangeable.
"A label such as transparency is a marketing claim. A contract is an obligation," he said. "Employers should look into the contract to confirm if the PBM accepts full fiduciary responsibility for the services or abdicates any fiduciary responsibility, which should be a red flag for the plan."
