The Trump administration continues to shape federal policy through executive orders, and several 2025 executive actions set the stage for future rulemaking for employee benefit plans. Four 2025 executive orders to watch would impact prescription drug pricing, pharmacy benefit manager (PBM) transparency, wellness programs, and reproductive health benefits.
Executive orders are not law—but they matter
It’s important to understand that executive orders generally are directives to federal agencies, and they are not binding regulations. However, they often initiate the regulatory process that leads to enforceable rules. For plan sponsors, this means that while no immediate action may be required, these orders provide a roadmap of what’s likely to come—and where compliance and strategy may need to shift.
“Most Favored Nation” executive order and drug pricing
One high-profile executive order issued in May 2025 is titled “Delivering Most Favored Nation Prescription Drug Pricing to American Patients.” This order directs the Department of Health and Human Services (HHS) to ensure that Americans pay no more for prescription drugs than the lowest price paid in comparable foreign markets.
Key elements of this order include:
- Mandating international price benchmarking for US drug purchases
- Facilitating direct-to-consumer drug purchasing from manufacturers
- Empowering federal agencies to investigate anti-competitive practices in global pharmaceutical pricing
While this order does not impose new obligations on employer-sponsored health plans, it could influence prescription drug plan designs and pricing in the future, including formulary design, drug pricing structures, cost-sharing strategies, and rebate arrangements.
Targeting PBM transparency and compensation
A second executive order, “Lowering Drug Prices by Once Again Putting Americans First,” instructs the Department of Labor (DOL) to propose regulations under ERISA Section 408(b)(2) by October 12, 2025, that increase transparency into PBM compensation and rebate practices.
The Trump administration has expressed concern that some PBMs may not be passing negotiated discounts to consumers or employer plans. If new rules are issued, plan sponsors may be required to:
- Disclose PBM compensation structures
- Justify rebate arrangements
- Demonstrate fiduciary oversight of PBM contracts
This aligns with the broader trend of fiduciary litigation targeting PBM arrangements (discussed in our upcoming article on PBM fiduciary risk). This development is a good reminder for employers to review their PBM contracts and fee disclosures to understand how their PBM addresses these topics. It is also important to note that the order does limit proposed regulations to only PBMs. Thus, other ERISA Section 408(b)(2) changes are also possible.
Wellness program flexibility
Another executive order establishes a task force to explore expanded flexibility for employer-sponsored wellness programs. The goal is to encourage benefits that support “beneficial lifestyle changes,” potentially easing restrictions imposed by tax laws, the EEOC, and HIPAA.
This could open the door for:
- Broader use of incentives in wellness programs
- Greater integration of financial wellness and behavioral health initiatives
- Reduced compliance burdens for certain wellness-related benefits
The wellness rules under EEOC and HIPAA are ripe for change and have not been updated in over a decade. Changes to the EEOC and HIPAA rules to align them with current trends and plan designs would be welcome news for plan sponsors. Such changes may also reduce the rash of lawsuits against employer plan sponsors in the wellness area.
IVF and reproductive health benefits
The administration has also signaled interest in reducing the cost of in vitro fertilization (IVF) and expanding access to fertility treatments. While this remains a policy goal rather than a regulatory mandate, it reflects growing public and political interest in reproductive health benefits.
Plan sponsors may want to:
- Evaluate current fertility benefit offerings under your medical plan
- Consider add-on fertility and related service offerings
- Assess employee demand and conduct competitive benchmarking
What plan sponsors should do now
Although these executive orders do not yet impose new compliance obligations, they are clear indicators of where federal policy is headed. It’s an important time to stay informed of on employee benefits law guidance from legal counsel and the latest industry developments. One particularly relevant action item is reviewing PBM contracts and rebate arrangements for transparency and fiduciary oversight. Today’s executive orders may be tomorrow’s proposed regulations.