If no action is taken, the enhanced Affordable Care Act (“ACA”) premium tax credits (“PTCs”) that were created in response to the COVID-19 pandemic will expire at the end of 2025. As background, the ACA created and implemented PTCs, which are subsidies offered to individuals to help lower the cost of their premiums for healthcare on ACA Exchange plans. During the COVID-19 pandemic, the PTCs were enhanced by Congress through the elimination of an income cap that had been used to disqualify higher-earners from receiving the PTCs, and through an increase in the subsidy amount available for all income brackets. These enhancements are set to expire at the end of 2025, impacting the qualification criteria for receiving the PTC subsidy and lowering the amount of PTC subsidy that is available to those who still qualify. Reverting to these unenhanced PTCs will significantly increase the premium cost for Exchange plans, which may push many employees back into employer-sponsored health plans if such plans are available to them. Additionally, since fewer employees will qualify for PTCs, this could decrease the risk of penalties for employers under the Employer Shared Responsibility Provisions (“Employer Mandate”) of the ACA since qualifying for PTCs is a necessary precursor for assessment of Employer Mandate penalties.

On December 19, 2025, the Centers for Medicare & Medicaid Services, Department of Labor and Treasury (“Agencies”) issued new proposed regulations (“Proposed Rules”) updating the transparency requirements issued under the Consolidated Appropriations Act of 2021 (“CAA”) in response to President Trump’s Executive Order 14221, entitled “Making America Healthy Again by Empowering Patients with Clear, Accurate, and Actionable Healthcare Pricing Information.” The Proposed Rules aim to update the CAA’s machine readable file (“MRF”) disclosure requirement by consolidating the MRF’s required files, cleaning the form and number of files and ensuring that the MRF is easy to find by specifying where the MRF should be housed on the plan sponsor’s website. Specifically, the Proposed Rules propose that group health plans and health insurance issuers will need to add a link in the footer of the home page of the plan’s or issuer’s website entitled “Price Transparency” or “Transparency in Coverage” that routes to the web page that hosts the MRF to allow for a simple and consistent path for users to find the MRF. Further, the Proposed Rules would require that the price transparency information that was previously available through both phone and the internet self-service tool would only need to be available over the phone upon request. If finalized as proposed, these Proposed Rules would take effect 12 months after the final regulation is published.

On December 5, 2025, the Internal Revenue Service (“IRS”) issued IRS Notice 2026-05 which contains guidance that clarifies the changes put in place by the One Big Beautiful Bill Act (“OBBBA”) on Health Savings Accounts (“HSAs”). The OBBBA allowed for high-deductible health plans (“HDHPs”) to cover telehealth or remote care prior to the annual deductible being fulfilled, for bronze and catastrophic individual plans to qualify as HDHPs for HSA eligibility and for direct primary care arrangements to be utilized without impacting HSA eligibility.

On December 2, 2025, the Department of the Treasury and the IRS issued guidance in Notice 2025-68 (“Notice”) to clarify rules relating to Trump Accounts. Trump Accounts, created under the One Big Beautiful Bill Act (OBBBA), and scheduled to be released to the public in 2026, are investment vehicles similar to individual retirement accounts for children under age 18. The Notice sets out initial general requirements for creating, funding and administering Trump Accounts, including the option for employers to set up a contribution program for Trump Accounts via salary reductions under a Section 125 cafeteria plan. Specifically, the Notice permits an employer to establish a Trump Account contribution program via salary reduction under a cafeteria plan to allow employees to contribute to Trump Accounts for their dependents. However, to avoid deferred compensation, the Notice explicitly prohibits using a cafeteria plan to fund contributions to an employee’s Trump Account. The Treasury Department and the IRS are expected to issue additional guidance related to the coordination of Trump Account contribution programs with Section 125 cafeteria plans in the near future.

On November 28, 2025, the Centers for Medicare and Medicaid Services (CMS) issued a proposed regulation (“Proposed Rule”) that would exempt health reimbursement arrangements (“HRAs”), including individual coverage HRAs (“ICHRAs”), from the Medicare Part D creditable coverage disclosure requirements. As background, plan sponsors providing prescription drug coverage are required to disclose whether the coverage is creditable, which generally means that the value of the prescription drug coverage provided is as good or better than the actuarial value of the prescription drug coverage under Medicare Part D. Currently, account-based plans, such as HRAs, are included in this disclosure requirement, but as explained in the Proposed Rule, account-based plans are often designed to supplement other coverage, rather than offering prescription drug coverage. Additionally, the design of account-based plans makes the disclosure of creditable coverage burdensome.  Further, because these account-based designs are often supplemental to primary coverage, participants receiving two different notices (one from the plan and one from the HRA) are often confused regarding the creditability of the coverage offered. The comment period for the Proposed Rule will be open until January 26, 2026.

On November 26, 2025, Judge Ouraishi of the U.S. District Court for the District of New Jersey ruled in favor of the defendant, Johnson & Johnson, in dismissing Lewandowski v. Johnson and Johnson, a lawsuit where the plaintiff alleged that mismanagement of the Johnson & Johnson health plan led to increased costs for the participants (see our eAlert, here). In his order, Judge Ouraishi wrote that it was too speculative to conclude that Johnson & Johnson’s alleged mishandling of plan funds and overpaying of certain plan vendors directly impacted the costs to the plan participants, and found the plaintiff’s attempts at establishing a direct connection unconvincing. He also found that the claims for damages were too speculative, and dismissed the case. It should be noted that Judge Ouraishi’s ruling was based on the plaintiff’s failure to demonstrate that they had suffered an injury that would give them standing to sue. However, the judge allowed the plaintiffs 30 days to file an amended complaint. Additionally, even though this case was dismissed, there are other similar cases (Navarro v. Wells Fargo and Stern v. JPMorgan Chase) that are still pending and could still have an impact on ERISA fiduciary compliance for health and welfare plan sponsors.

On November 21, 2025, Eli Lilly, the maker of popular glucagon-like peptide-1 (“GLP-1”) medications such as Zepbound, announced that they will be producing a new employer-focused model designed to expand access to these GLP-1 medications through employer plan sponsors. This model will provide flexibility for employers to design an obesity management program for their workforce. Combined with two holistic obesity management programs through independent third parties, the employer plan model will utilize a specific network of pharmacies to deliver this care.

The holistic obesity management program is in partnership with Waltz Health, a health tech company that provides marketplaces aimed at lowering drug costs, and 9amHealth, a virtual cardiometabolic care provider. Waltz Health will provide a platform that combines pricing for obesity drugs with eligibility determinations, prescription routing and continuing care management, while 9amHealth will provide an obesity care platform to go alongside access to Eli Lilly’s GLP-1 medications. More details, including pricing, will be released when this employer-focused model is released in early 2026.

On November 17, 2025, in Pritchard v. Blue Cross Blue Shield of Illinois, the U.S. Court of Appeals for the 9^th Circuit ordered a trial court to reconsider its ruling that an insurer, acting as a Third-Party Administrator (“TPA”) for a self-insured health plan, violated Section 1557 of the Affordable Care Act (“ACA”) by excluding coverage for gender affirming care.
As background, Section 1557 of the ACA prohibits certain health programs and activities that receive federal funds from discriminating on the basis of race, color, national origin, sex, age, or disability. According to the 2020 Section 1557 Final Rule, entities which are not “principally engaged in the business of providing healthcare” are regulated by Section 1557 to the extent that they receive federal financial assistance. The insurer in the case, Blue Cross Blue Shield of Illinois (“BCBSIL”), argued that the requirements of Section 1557 did not apply because it received such funding only in connection with their offerings such as Medicare supplemental coverage, and not through their operations as a TPA for self-insured health plans. The trial court rejected this reasoning as well as the insurer’s other arguments and awarded class-wide relief, including reprocessing of affected claims and a permanent injunction prohibiting the TPA from applying the gender-affirming care exclusions. The 9^th Circuit agreed with the trial court that the TPA’s provision of health insurance allows for the TPA to be liable for violating Section 1557. However, the 9^th Circuit ordered the trial court to reconsider its ruling that the gender-affirming care exclusions were discriminatory in light of the U.S. Supreme Court’s decision in U.S. v. Skrmetti, which upheld a state’s ban on gender-affirming care for transgender teenagers. The 9^th Circuit reasoned that the ban did not draw classifications based on sex, but instead  prohibited such treatments for certain medical uses with respect to all minors, regardless of sex or gender.

The Trump Administration recently announced that, effective January 1, 2026, it will be launching a new online prescription drug program called “TrumpRx,” which will attempt to lower the cost of prescription drugs for Americans. TrumpRx is a website that functions similarly to a search engine for purchasing prescription drugs where Americans will be able to purchase their prescriptions directly from manufacturers at discounted rates that are closer to “most-favored nation” (MFN) prices. As background, President Trump’s MFN drug pricing policy aims to lower U.S. prescription drug costs by tying them to the lowest prices paid by other comparable developed nations. It pressures pharmaceutical companies to match these international benchmarks through voluntary agreements or regulatory action. TrumpRx will provide individuals the opportunity to purchase these discounted medications without insurance or Pharmacy Benefit Manager involvement. The prescriptions available through TrumpRx will be from manufacturers who have struck deals with the administration to lower their prices for this program, including AstraZeneca and Pfizer.

On November 6, 2025, the Trump Administration announced via White House live stream, along with an accompanying Fact Sheet, a new set of deals with drug manufacturers Eli Lilly and Novo Nordisk to reduce the price of their popular GLP-1 drugs. When purchased through TrumpRx, Ozempic and Wegovy will cost $350 per month, down from their current price of $1,000 and $1,350 per month respectively. The price through TrumpRx of Zepbound and Orforglipron (if approved) will fall from $1,086 per month to an average of $346. Additionally, if the U.S. Food and Drug Administration approves an oral GLP-1 tablet produced by either of these companies, the price will be $150 for the initial dose through TrumpRx. Further, the deal will lower prices for Medicare and state Medicaid programs for each of the previously listed drugs. Additionally, Eli Lilly and Novo Nordisk will provide discounts on their other popular drugs such as Emgality, Trulicity, NovoLog and Tresiba. Eli Lilly and Novo Nordisk have each pledged further investment in American drug manufacturing and research as a part of the deal.

On November 3, 2025, the Internal Revenue Service (IRS) released updated Patient Centered Outcome Research Institute (PCORI) fee amounts. As background, the PCORI fee has been in place since September 30, 2012, and is paid annually by self-insured health plan sponsors on a “per covered life” basis. For plan and policy years ending on or after October 1, 2025, and before October 1, 2026, the new PCORI fee amount is $3.84 per covered life, which is an increase from the previous amount of $3.47 per covered life. The fee is due annually on July 31.