Pharmacy benefit managers are suing Illinois to strike down a new drug-pricing law, arguing federal rules override it.
The Pharmaceutical Care Management Association, the national trade group for PBMs, filed suit on June 16, 2026, against the director of the Illinois Department of Insurance and the department itself. The complaint takes aim at the Illinois Prescription Drug Affordability Act, signed into law on July 1, 2025, which PCMA says stretches past what a state can regulate.
The argument rests on ERISA, the federal law covering employee benefit plans. PCMA alleges the Illinois law is "preempted" - meaning federal rules override state ones where they clash. According to the complaint, ERISA has for more than fifty years overridden state laws that "relate to" employer and union benefit plans.
PCMA is challenging two pieces of the law.
The first is reporting. The complaint says PBMs must file a detailed annual report with the state, the first due September 1, 2026, covering claim-by-claim data such as "total out-of-pocket spending" by individual per drug and "average wholesale acquisition cost per drug." Miss it, and the filing says PBMs "face fines of up to $10,000 per day."
The second is network design. The law bans "steering." The complaint says "steer" covers requiring a patient to use an affiliated pharmacy, or offering a plan design that "encourages" use of an affiliated pharmacy "if the plan design increases costs" for the patient. PCMA claims that kills the preferred pharmacy networks plans use to push patients toward cheaper drugstores.
Precedent drives the case. PCMA points to the 2016 Supreme Court ruling in Gobeille v. Liberty Mutual Insurance Co., which voided a Vermont reporting law, and argues the Illinois rule is "precisely like the Vermont statute invalidated by the Supreme Court." It also cites Rutledge v. PCMA and recent appeals-court decisions on pharmacy networks.
For insurers and claims professionals, the fight is about plan administration. The complaint says about two-thirds of employer- and union-sponsored plans are "self-funded" ERISA plans that pay claims from their own funds. PCMA argues that state-by-state rules force PBMs into "state-specific plan designs" - the patchwork ERISA was built to stop.
PCMA wants both provisions - the reporting rule at 215 ILCS 5/513b1.1 and the anti-steering rule at 215 ILCS 5/513b1 - declared invalid for ERISA-covered plans and permanently blocked from enforcement. It also seeks attorneys' fees and costs.
These are allegations. The defendants have not yet responded, and no court has ruled.
