A Delaware state senator is accusing the board that manages health benefits for more than 135,000 public employees of dragging its feet on drug-pricing reform - a dispute playing out as Congress rolls out similar transparency requirements for employer health plans nationwide.
Sen. Ray Seigfried, a Democrat from Claymont and former ChristianaCare executive, sponsored a 2025 resolution ordering Delaware's State Employee Benefits Committee to find ways to make pharmacy benefit manager negotiations more transparent. The state's Group Health Insurance Plan covers state employees, educators, law enforcement officers, retirees and their families, and was projected to cost nearly $1.6 billion for fiscal year 2027, according to a budget presentation.
Seigfried noted the state could save tens of millions of dollars by addressing hidden costs built into the health care supply chain - the same costs large self-funded employer plans will soon be entitled to see in detail under federal law.
The SEBC's response said it had built many of the resolution's ideas into its current bid process for a new PBM, but warned that bolder transparency moves risked raising prices or jeopardising existing rebates. Surgeon General Neil Hockstein, who chairs the SEBC, said in an email to WHYY News: "The report identifies limitations in the current PBM marketplace, including proprietary systems, confidentiality provisions, manufacturer agreements, and restrictions on the use and disclosure of certain pricing information. Those are issues the state must address to achieve greater data transparency."
Seigfried called the report a blueprint for "bureaucratic inertia." He said: "I want us to own the information. I want us to understand the information. I want us to be able to do an analysis of that data and negotiate appropriately to keep the price down." His framing maps almost exactly onto the core provision of the new federal law: giving plan sponsors direct access to PBM pricing data they have historically been unable to obtain.
Congress passed the Consolidated Appropriations Act of 2026 on February 3, requiring PBMs to provide large self-funded employer plans - generally those with 100 or more participants - with detailed, semiannual drug-pricing and rebate reports, plus a 100% rebate pass-through. Large fully insured plans are not covered automatically; they must opt in each year to receive the same reports, according to benefits firm NFP. Most of these requirements take effect for plan years beginning 30 months after enactment - January 1, 2029, for calendar-year plans, according to benefits consultancy Segal. A narrower Department of Labor rule proposed January 30, 2026, would apply only to self-funded ERISA plans and, if finalised, could take effect as early as mid-2026, but it remains a proposal.
Jeffrey Hogan, managing director and co-founder of benefits consultancy Judi Group, called the CAA 2026 reforms "by far the most sweeping PBM reform in ERISA history" at an ERISA industry panel in 2026 - an assessment made against a law that will phase in gradually rather than take hold at once.
Two state-level models offer context for what federal reform may encounter. New Jersey passed legislation in 2016 letting the state share bid information to spur more competitive PBM offers, while Montana's insurance department took on responsibility for overseeing PBM rebate distribution to insurers, aiming to lower consumer costs. Delaware's SEBC report cited proprietary PBM data and confidentiality provisions as market barriers it has not yet overcome - precisely the barriers the CAA 2026 is designed to remove at the federal level for qualifying employer plans.
The CAA 2026's automatic reporting threshold - 100 or more participants for self-funded plans - means the practical effect of the new law will differ across client books before it takes full effect in 2029. Brokers should be identifying now which self-funded clients cross that threshold and beginning PBM contract reviews ahead of the 2029 effective date. Building the data infrastructure to actually use new disclosure rights - claims-level reporting, rebate reconciliation, semiannual benchmarking - takes time to develop, and plan sponsors who wait for the law to take effect before establishing that infrastructure will be starting from a standing position when the disclosure rights finally arrive.
The Delaware dispute illustrates what that infrastructure gap looks like in practice. The SEBC has had a legislative mandate for transparency since 2025 and is still working through how to exercise it against PBM confidentiality provisions. Employer plans with 100 or more participants will face the same structural resistance when the CAA 2026 comes into force. The broker who helps a client build the data readiness before 2029 is the one whose value is visible when the law finally delivers the leverage it promises.
