Employees in self-funded health plans are filing ERISA suits — ERISA is the federal law governing employer-run health and retirement plans — over prescription-drug costs handled by pharmacy benefit managers, called PBMs. No settlement or claim form exists now, and early rulings focus on whether workers can show personal financial harm.
The core dispute is fiduciary care. Workers say plan officials paid too much for drugs and let PBM middlemen keep the difference. Courts are testing what proof gives employees standing to sue.
Official resources:
- Read the official notice from Nfp — Use this primary source to verify the official announcement.
- Read the official notice from Chambers — Use this primary source to verify the official announcement.
Table of Contents
- What are workers alleging about PBM deals?
- Why are many cases dismissed early?
- What survived in the JPMorgan lawsuit?
- What new transparency rules are coming?
- What should employees do now?
What are workers alleging about PBM deals?
In February 2024 employee Ann Lewandowski sued Johnson & Johnson over its self-funded plans and their use of Express Scripts, as Frier Levitt reports in its case analysis. The suit alleged spread pricing, rebate retention and inflated generic prices breached fiduciary duties. The complaint used a stark price comparison. It cited generic Imatinib at $16,398.17 through the plan versus $94.10 at Cost Plus Drugs.
That gap illustrates the claim that prudence required shopping, auditing or renegotiating the PBM contract. A second suit followed a similar theory. On March 13, 2025 current and former JPMorgan employees filed Stern v. JPMorgan Chase over CVS Caremark fees in its self-funded plan. They alleged breach of prudence and loyalty plus prohibited transactions.
Why are many cases dismissed early?
Judges often stop these suits at standing. Standing means the plaintiff shows a concrete injury tied to the challenged conduct. Without it, the court cannot reach mismanagement claims. On Nov. 26, 2025 the District of New Jersey dismissed Lewandowski's second amended complaint, as BenefitsPro explains in its dismissal report.
The court found alleged PBM overcharges had no proven effect on plaintiffs' premiums or benefits. It granted leave to file a third amended complaint. That hurdle is not unique. On March 24, 2025 the District of Minnesota dismissed Navarro v. Wells Fargo, another employee suit over drug-plan management. The pattern warns workers that plan-level overspending alone rarely supports a federal case.
What survived in the JPMorgan lawsuit?
On March 9, 2026 Judge Jennifer Rochon partly dismissed Stern but let part move forward, as Chambers and Partners describes in its Stern case update. Fiduciary-breach claims failed because they challenged settlor plan-design functions. The CVS Caremark contract still stated a plausible prohibited transaction. Standing turned on out-of-pocket harm.
Higher premiums alone were too speculative because participant contributions stayed stable despite swings in plan spending. Inflated copays and coinsurance tied to alleged 211.1% average markups on 366 generics sufficed. The lesson is narrow but practical. Design choices about what a plan covers get strong deference. Concrete drug-level overcharges paid directly by the worker carry more weight than broad claims of waste.
What new transparency rules are coming?
On Jan. 30, 2026 the Labor Department proposed requiring PBMs and affiliates to disclose all compensation to fiduciaries of self-funded ERISA plans, as Sequoia summarizes in its PBM reform summary. The proposal covers rebates, spread pricing and fees, plus audit rights. It would apply to plan years starting July 1, 2026. Congress then added statutory duties. The Consolidated Appropriations Act of 2026, enacted Feb.
3, 2026, mandates 100% rebate pass-through and semiannual drug-level reporting for large self-funded plans. Most provisions take effect for plan years starting Aug. 3, 2028. These dates matter for evidence. Later plan years should produce clearer records of rebates, markups and fees. Earlier periods may remain hard to prove without internal plan documents.
What should employees do now?
There is no filing to join today. Watch for an amended complaint, a class-certification order or an approved settlement notice from a court.
Those events create eligibility rules and deadlines. Use this time to preserve your own proof: Direct harm controls your options. Save pharmacy receipts and plan notices now; they matter more than signing up for a settlement list.
- save pharmacy receipts, explanations of benefits and copay records for generics
- keep annual enrollment notices showing premiums, deductibles and drug tiers
- note any switch to cash-pay or discount-drug options because plan prices were higher
- keep employer notices about the PBM, formulary changes or rebate use