The reforms included in the Act are applauded by pharmacies and pharmacy advocacy groups across the country as this law, if passed by the Senate and signed into law, will have actual practical implications for pharmacies.

The 2026 Consolidated Appropriations Act, HR 7148, was passed by the U.S. House of Representatives on January 22, 2026. It includes several significant provisions impacting pharmacy benefit managers (PBMs), with one of the most consequential changes being Congress’ directive to the Centers for Medicare and Medicaid Services (CMS) to define and enforce what constitutes “reasonable and relevant” contract terms between Medicare Part D plans (and their PBMs) and pharmacies. These changes have particular importance for the operation and enforcement of “any willing pharmacy” (AWP) requirements.

Any Willing Pharmacy Under Medicare Part D

Medicare Part D includes a statutory AWP requirement designed to promote beneficiary access to pharmacy services. In general terms, AWP requires that a Part D plan permit any pharmacy to participate in the network, so long as the pharmacy is willing to accept the plan’s standard terms and conditions. CMS requires such standard terms and conditions to be “reasonable and relevant” to the pharmacy’s services and functions.

Historically, AWP has focused on formal access—whether a pharmacy is offered the same contract terms as other similarly situated pharmacies—rather than on whether those terms are commercially viable and sustainable for participating pharmacies. As a result, PBMs have often defended restrictive reimbursement models by asserting that AWP is satisfied if all pharmacies are offered similar terms, even where those terms effectively prevent meaningful participating in the Part D program by pharmacies experiencing, for example, below-cost reimbursement from PBMs (i.e., being paid for dispensing medications amounts less than the pharmacy pays to acquire the medications). Accordingly, for years, a chief complaint of pharmacies participating in the Medicare Part D program has been the notion that below-cost reimbursement is not a “reasonable and relevant” contract term.

Key Change: “Reasonable and Relevant” Is No Longer Abstract

Historically, Medicare Part D has required that pharmacy contract terms be “reasonable and relevant,” but the statute offered little practical guidance as to what that meant. The Consolidated Appropriations Act moves away from this ambiguity by directing CMS to establish objective standards for determining whether pharmacy reimbursement terms and conditions meet this requirement.

Importantly, the Act instructs CMS to evaluate:

• Reimbursement rates, including ingredient cost methodologies and dispensing fees;
• Contractual terms affecting pharmacy participation, including administrative and operational requirements; and
• Whether contract terms function, in practice, to exclude pharmacies from participation, even if nominal network access is offered.

This language marks a shift from a contractual analysis to a functional access analysis.

Reinforcing Any Willing Pharmacy Protections

The Act’s “reasonable and relevant” framework directly intersects with the Medicare Part D AWP requirement. While AWP has long required PBMs to allow participation by pharmacies willing to accept plan terms, the new language focuses on whether those terms are commercially viable and objectively reasonable, rather than merely uniform.

Under the Act:

• PBMs may no longer rely on the argument that a contract satisfies AWP simply because all pharmacies are offered the same terms.
• CMS is directed to assess whether reimbursement and fee structures are set at levels that effectively discourage or preclude participation, particularly for independent and community pharmacies.
• Contract terms that are technically open, but economically untenable, may be deemed unreasonable and irrelevant, and therefore inconsistent with AWP principles.

Appeals, Oversight and Enforcement

The Act also expands CMS oversight by:

• Requiring CMS to create or strengthen appeals mechanisms for pharmacies challenging contract terms that fail to meet the reasonable and relevant standard;
• Allowing CMS to review reimbursement trends and participation rates to identify de facto network exclusion; and
• Authorizing enforcement actions and penalties, including the implementation of civil monetary penalties, where PBMs or plan sponsors fail to comply.

This increases the likelihood that AWP disputes—traditionally litigated or addressed through state law—will now be actively regulated at the federal level in Medicare Part D.

Practical Implications

The reforms included in the Act are applauded by pharmacies and pharmacy advocacy groups across the country as this law, if passed by the Senate and signed into law, will have actual practical implications for pharmacies. Pharmacies may gain a stronger basis to challenge reimbursement models and participation terms that undermine network access via AWP in practice.

Additionally, this law will likely require PBMs and Part D plan sponsors to reassess network design, reimbursement methodologies and dispensing fee structures in anticipation of CMS rulemaking, which likely will increase reimbursement to participating pharmacies.

Further, plan sponsors should expect increased scrutiny of pharmacy access, particularly in underserved or rural areas.

If the Act becomes law, CMS will be expected to issue guidance or rulemaking to operationalize these standards. How CMS defines “reasonable and relevant”—particularly with respect to minimum reimbursement adequacy and access thresholds—will be critical.

Additionally, should the Act become law in its current form, the above requirements will be effective January 1, 2029.

We are closely monitoring the progression of this Act through the Senate. If it is enacted in its current form, we will also be closely monitoring CMS implementation and expect these provisions to materially affect Part D contracting and AWP enforcement going forward.

For More Information

If you have any questions about this Alert, please contact Jonathan L. Swichar, Bradley A. Wasser, Nikki Baniewicz, any of the attorneys in our Pharmacy Litigation Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.