DOL’s Caitlin Soto Outlines Strategy to Lower Healthcare Costs for Employers

Caitlin Soto, Senior Policy Advisor at the Department of Labor’s Employee Benefits Security Administration (EBSA), recently detailed the agency’s vision for transforming employer-sponsored healthcare, focusing on cost reduction, transparency, and increased value. Speaking at the Purchaser Business Group on Health (PBGH) Health Policy Summit on March 10, 2026, Soto highlighted the challenges employers face – rising costs, regulatory burdens, and a system often prioritizing profits over people – and outlined key initiatives to address these issues.

The State of Employer-Sponsored Healthcare

Soto emphasized that employers are at a critical juncture, experiencing significant increases in healthcare costs. Without changes, employers are bracing for a median 9 percent rise in healthcare costs in 2026, reduced to 7.5 percent only after plan redesigns and adjustments. This impacts employers’ ability to invest in their workforce through raises, hiring, and innovation. The PBGH has described the current trajectory as “unsustainable.”

A significant driver of these costs is pharmacy spending, particularly for GLP-1 obesity drugs, cancer care, and mental health services. These costs create a broader economic burden, hindering business growth and talent acquisition.

EBSA’s Regulatory Agenda: Transparency and Accountability

Soto outlined several key initiatives led by herself and Assistant Secretary Daniel Aronowitz, with the support of Secretary Chavez-DeRemer and Deputy Secretary Sonderling, designed to empower employers and employees and foster a more competitive healthcare marketplace. These initiatives align with President Trump’s vision for healthcare, focusing on lowering drug prices, reducing insurance premiums, holding insurance companies accountable, and maximizing price transparency.

PBM Fee Disclosure Rule

A cornerstone of EBSA’s efforts is a proposed regulation to improve transparency into Pharmacy Benefit Manager (PBM) fee disclosures. Soto, who previously led an investigation into PBM practices whereas on the Senate Finance Committee, emphasized the difficulty of correcting problems once exposed. The proposed rule, inspired by an executive order from President Trump, requires PBMs to disclose detailed information about their compensation, including rebates from drug manufacturers, payments related to pharmacy reimbursements, and other fees.

This rule represents a significant shift from past disclosures, which often relied on complex formulas. The new rule requires the disclosure of actual dollar amounts, enabling employers to assess the reasonableness of PBM compensation under the Employee Retirement Income Security Act (ERISA). The rule also grants employers the right to audit these disclosures for accuracy.

This initiative complements the Consolidated Appropriations Act of 2026, which requires PBMs to pass 100 percent of rebates to health plans and mandates clear, flat fees for PBM services. EBSA’s proposed rule provides the practical tools for plan fiduciaries to enforce these new standards.

Transparency in Coverage Proposal

EBSA is also advancing the Transparency in Coverage proposal, aiming to provide employers and employees with access to real-time pricing information before receiving care. Currently, negotiated prices between insurers and hospitals are often inaccessible. The proposal seeks to make existing machine-readable files more useful by improving data clarity, labeling, and network information, facilitating easier comparison of plans and providers.

Streamlining Processes and Reducing Burdens

Beyond these key regulations, EBSA is working to streamline processes and reduce administrative burdens for employers. This includes updates to rules around electronic disclosures for health plans, simplifying digital benefits delivery and potentially saving billions of dollars.

Looking Ahead

Soto concluded by reiterating the Department’s commitment to protecting the American worker and building a better healthcare system. EBSA’s agenda focuses on empowering employers, driving down costs, and increasing transparency, ultimately delivering on the President’s and the Administration’s promises.