The pharmaceutical industry is entering a major transformation driven by two federal pricing reforms: the Inflation Reduction Act (IRA) and new Most Favored Nation (MFN) pricing initiatives signed in 2025. These changes will allow Medicare to negotiate lower prices on many high‑cost medications and tie U.S. drug prices more closely to those in other developed countries. As manufacturers face reduced margins and increasing pressure for price transparency, many are turning to a new strategy: selling medications directly to consumers at cash prices. While this trend is largely aimed at patients, it’s poised to have ripple effects on employer-sponsored health plans.

The GLP-1 race is stepping to the next level, and in late December, the FDA approved the first GLP-1 pill from Novo Nordisk for weight loss and maintenance. This Wegovy (semaglutide) pill just recently hit the shelves, with competitor versions, like those from Eli Lilly, soon to follow.

The IRS has released its 2026 benefit updates, bringing several contribution limit increases and compliance considerations for employers. Below is a snapshot of the most important changes HR and benefits teams should review to ensure plans, payroll, and employee communications are aligned for the year.

The Inflation Reduction Act of 2022 (IRA) significantly impacted Medicare Part D prescription drug coverage, and these changes are rippling through employer-sponsored health plans. Employers need to be aware of the new rules to ensure compliance and support their Medicare-eligible employees.

The core of the change: Higher Part D Value

• Increased Out-of-Pocket Cap: Medicare Part D beneficiaries will have their annual out-of-pocket costs capped at $2,100 in 2026 (an increase from the $2,000 cap in 2025).
• Impact on Employer Plans: This increased value of standard Part D benefits means that employer-sponsored prescription drug plans may need to provide richer coverage to be considered "creditable" – meaning the actuarial value of the employer's plan is at least as good as the Part D standard. Some plans that were previously considered creditable may not be in 2026 due to these changes to Medicare Part D.

On July 4, 2025, President Trump signed the One Big Beautiful Bill Act (H.R. 1) into law — a sweeping reconciliation package with far-reaching implications for employer-sponsored health plans. With deep Medicaid cuts, reshaped ACA subsidies, and new tax incentives, employers must act now to shield plan sponsors—and their workforce—from unintended fallout.

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Has Your Company Reached 100 Employees? Are you familiar with your EEO-1 Reporting Responsibilities?The federal government has announced the EEO-1 reporting site has opened for the 2024 reporting cycle. The reporting deadline is unusually short this year, with all reporting due by June 24, 2025.What is this reporting, and who is required to do it?Employers Required to ReportCompanies with 100 employees for at least one week in fourth quarter of 2024, you are required to comply. Federal contractors and first tier subcontractors with 50 or more employees and who have at least $50,000 in contracts with the federal government annually are also required to comply.When counting employees, each employee equals “1,” regardless of the number of hours they work. Related companies in a control group arrangement are counted together when determining the 100 (or 50) employee threshold.State and local governments, public elementary and secondary school districts, and local referral unions are generally exempt from EEO-1 reporting, though they may have other EEO data reporting obligations with the federal government.

In the ever-changing world of the Earned Sick Time Act (ESTA), the State of Michigan has developed FAQ’s and conducted a seminar to further explain the changes to the law. These can be found at the Michigan Labor and Economic Opportunity (LEO) website at:https://www.michigan.gov/leo/bureaus-agencies/ber/wage-and-hour/paid-medical-leave-actBased on the information in the seminar, there are a few changes from our communication sent out on Friday, February 21, that are important to note:

In the late hours of Thursday, February 20, 2025, the Michigan legislature passed two bills that will amend the Earned Sick Time Act (scheduled to be effective Friday, February 21). Some of the more challenging issues for employers related to the law were addressed by these changes, such as the requirement to carry over unused sick time each year (see more below).Per the bills, these changes (unless specifically indicated in the details below) take effective immediately (February 21).