Purchaser Business Group on Health Remarks
Good morning, everyone.
My name is Caitlin Soto and I am privileged to lead health care policy for the Department of Labor’s Employee Benefits Security Administration (EBSA).
Before I get into my prepared remarks, I want to thank the Purchaser Business Group on Health (PBGH) for inviting me to be here today and for championing the work of the Department.
It’s an honor to speak to a room filled with private employers who spend billions annually providing health care to millions of Americans.
Folks here know better than anyone the challenges employers face when providing health care to their employees: skyrocketing costs, government red tape, and a system that prioritizes profits over people.
Before I joined EBSA, I spent nearly a decade on Capitol Hill digging into the exact issues employers deal with every day.
In 2019, headlines such as, “Why Desperate Americans are Driving to Canada for Insulin,” sparked national debate over U.S. drug pricing.
These stories showcased “caravans” of patients crossing the border, turning a medical need into a desperate, cross-border quest for affordable life-saving medicine.
The public was outraged. I know I was.
So, Congress—which is not always known for acting quickly—stepped up with investigations.
As an attorney on the Senate Finance Committee, I led one of these investigations into how PBMs influence insulin’s price.
We reviewed hundreds of thousands of documents produced by the big three and drafted a 100-page report detailing our findings.
Through this work, my team and I showed the world how direct and indirect fee structures were driving up the price of insulin—and how this impacted employers’ and employees’ ability to pay.
I am proud of that work—it helped spark the PBM reforms we’re seeing today, including the FTC’s big settlement with Cigna and so much more.
So, when I was asked if I wanted to drive real, meaningful change and lead health care policy for the Department—I jumped at the opportunity to serve President Trump and his Administration and to continue the work I started more than seven years ago.
Before talking about EBSA’s regulatory agenda, I first want to start by discussing the state of employer-sponsored health care.
Employers are at an inflection point right now.
Some of you have experienced the highest back-to-back increases in health care costs in decades—increases the Trump administration is working hard to drive down.
If the status quo remains, however, employers are bracing for a median 9 percent rise in health care costs in 2026—brought down to 7.5 percent only after tough changes and plan redesign.
That’s 7.5 percent less for giving raises to American workers.
7.5 percent less for hiring American workers.
And, 7.5 percent less for innovating to better the lives of American workers.
Your own PBGH has called this “unsustainable.”
Pharmacy spending is a large part of this equation, fueled, in large part, by soaring demand for GLP-1 obesity drugs, cancer care, and mental health services.
These costs act as a significant, often hidden, tax on the broader economy—making it hard to start a company, grow one, or hire talent.
I want to share a quick, personal story that hits home for me—and explains the delicate balance that many of you may be struggling with today.
My dad has owned and operated a small law firm in South Florida for over 30 years.
His is a classic American success story: Cuban American, started from scratch, hands-on every day while raising three kids.
He loves what he does—he’s his own boss, takes pride in his work, and has stuck with it through good times and bad because it’s rewarding and put us through college.
(Thanks dad!)
My dad doesn’t have to offer health insurance to his employees—no law requires it for a firm of his size.
But, he does it anyway. To him, it’s the right thing to do.
It helps him attract and keep good people—the kind of reliable, skilled workers who make his firm run smoothly.
But, here’s the hard truth playing out in real life: those rising health care costs have taken a real toll.
The administrative burdens, the premium hikes year after year, the uncertainty—it’s all added up.
What started as a benefit to support his team is becoming a bigger burden on the business each year.
It’s squeezed his margins, limited his ability to expand or hire, and forced tough choices.
In fact, it’s weighed so heavily that it’s influenced his thinking about the future. He’s started talking more seriously about retiring one day and closing shop.
The very thing he offered out of care for his employees has become one of the many barriers to keeping the business going long-term.
He’s not alone in his thinking. Business owners across the country are feeling this squeeze.
For firms like my dad’s, these costs aren’t abstract numbers; they are the difference between growing the business, holding steady, or walking away.
This is an impossible choice.
And, this is exactly why our work at EBSA matters so much.
We’re not just talking about big employers or large plans—we’re fighting for everyone, including the small businesses that form the backbone of our economy.
There are 2.8 million ERISA-covered group health plans covering approximately 135 million Americans.
EBSA plays a pivotal role in protecting the health benefits of the American worker, overseeing compliance, enforcing protections, and promoting transparency to safeguard benefits.
EBSA’s Assistant Secretary Daniel Aronowitz and I—with the support of Secretary Chavez-DeRemer and Deputy Secretary Sonderling—have a vision for transforming employer-sponsored health care in the United States—a vision that puts control back in the hands of employers and employees, drives down costs, and maximizes value.
We do that by leveraging EBSA’s regulatory and enforcement capabilities to foster a more transparent, competitive, and efficient marketplace.
This is aligned with and builds upon President Trump’s vision for health care.
In his Great Health Plan, President Trump laid out a bold, comprehensive framework to tackle the root cause of skyrocketing health care costs—focusing on four key pillars:
- Lowering drug prices,
- Reducing insurance premiums,
- Holding big insurance companies accountable, and
- Maximizing price transparency across the entire system.
A prime example of how EBSA is delivering on President Trump’s plan to maximize transparency across the entire system is the Department’s groundbreaking proposed regulation to improve transparency into PBM fee disclosures.
On the Hill, I exposed some of the problems with PBM business practices. However, exposing them and correcting them are two very different things.
There have been many attempts at PBM reform over the years, but they have all failed for one reason or another.
I was proud to lead this proposed rule, working with our dedicated regulatory team for ten months to finally get PBM reform right.
Our rule was offered in response to an inspired executive order from President Trump.
Last April, he made clear that we must “promote a more competitive, efficient, transparent, and resilient pharmaceutical value chain that delivers lower drug prices for Americans.”
Our proposed rule requires PBMs and any other provider of pharmacy benefit services to disclose, for the first time, detailed information about their compensation including rebates from drug manufacturers, payments when the pharmacy reimbursements exceed plan costs, price protection arrangements, and any other fees or payments not expressly enumerated.
One of the most powerful aspects of this proposed rule—and what makes it groundbreaking—is that it would require actual dollar amounts to be disclosed, not just vague formularies, percentages, or methodologies.
In the past, plan fiduciaries often received disclosures in the form of complicated formulas: “We charge X percent of claims,” or “manufacturers must pay X percent of list price.”
This might sound reasonable on paper, but it makes it nearly impossible to translate into real money flowing in and out of your plan.
You couldn’t easily add them up, compare them across competitors or other innovative models, or truly assess whether the compensation was reasonable under ERISA.
A shift to actual prices would be a game-changer because it would arm you with the facts you need to do your job as fiduciaries.
When EBSA’s proposal is finalized, employers will receive these initial disclosures before contracts are signed, followed by semiannual reports on the actual compensation received.
And, crucially, it gives you the right to audit these disclosures to verify accuracy, ensuring PBMs can’t hide behind vague contracts anymore.
No more guessing about where your money goes; you will see the full picture, from manufacturer rebates to affiliate incentives.
This transparency will expose inefficiencies, drive competition among PBMs, and ultimately lower drug costs for you and your employees.
This proposed rule also works together with a new law Congress just passed—the Consolidated Appropriations Act of 2026.
The law is a major step forward. It requires PBMs to pass 100 percent of rebates from pharmaceutical manufacturers to health plans.
It sets forth rules so PBMs can get paid only through clear, flat fees.
And, it demands regular reports from PBMs to plans.
Our proposed rule picks up right where the law leaves off.
The new legislation tells PBMs what they must do.
Our rule spells out how you, the plan fiduciary, get the details you need to make sure they follow through.
Put simply, the law sets strong new standards across the board, and our rule gives you the practical, everyday tools to enforce them under ERISA.
We are very proud of this rule and look forward to reading all the thoughtful comments from the regulated public.
The President asked us to protect the American worker, and that’s what our proposed rule does with gusto.
Another big win we are delivering right now is the Transparency in Coverage proposal we put out late last year.
This isn’t some dry regulatory update.
It’s the next big step in making sure you—the employers who pay for this coverage—and your employees can finally see what things really cost before someone walks into a doctor’s office.
Think about it: for years, the prices negotiated between insurers and hospitals have been locked away in secret files that are nearly impossible for everyday Americans—or even most plan sponsors—to use.
Imagine walking into a grocery store and having to guess how much you are going to pay for food when you get to the checkout line?
Or a restaurant, a movie theater, a retail store, or any other market in America for that matter. This only happens in health care.
The current system is unfair to the American worker, and our proposal changes that.
It takes the public machine-readable files we already require and makes them actually useful: cleaner data, better labels, clearer network information, and easier ways to compare one plan or provider to another.
With transparency in place, innovation flows. You can negotiate harder, pursue new innovative health care arrangements, and design benefits that truly meet your workforce’s needs.
EBSA is also taking practical steps right now—steps that cut unnecessary paperwork, reduce hassles, and give everyone more room to try new ideas that help people get better care at lower costs.
A great example is our work on the Independent Dispute Resolution Process.
This is a system that steps in when a patient gets hit with a surprise bill from an out-of-network provider—like in an emergency—and a health plan and a provider can’t agree on payment.
For far too long, that process has been slow, confusing, and full of back-and-forth that wastes time and money.
The goal in finalizing this rule is simple: resolve these billing fights quicker so providers, plans, and employers can spend less time arguing over payment and paperwork and focus on more creative ways to deliver care.
This is just one piece of how we are delivering for the American worker. Our regulatory agenda is full of other smart moves to open the door wider for innovation.
We’re also updating rules around electronic disclosures for health plans—making it safer and simpler to send benefits digitally, through apps or online portals.
That means less printing and billions in savings for employers so they can invest in their workforce and workforce innovations.
None of this work is about adding more red tape. It’s about removing barriers so that the market can do what it does best: compete, innovate, and deliver better value.
By streamlining these processes and providing clear guidance, EBSA is helping create an environment where employers like you can test new benefit designs—without getting stuck in outdated rules.
These are but a few examples of our aggressive agenda—but, there’s more.
A lot more.
Like I said, the Department’s vision for employer-sponsored health care is one of empowerment through EBSA: maximizing value, costs curtailed, and transparency as the norm.
By executing on this vision, we’re not just fixing a broken system; we’re building a better one, and we are delivering on the President’s and the Administration’s promises.
And, we’re doing this with urgency.
Thank you.