Trump Admin Tests New Medicare Drug Pricing Pilot Programs

Authored by Jacki Thrapp via The Epoch Times (emphasis ours),

The U.S. Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS) announced two pilot programs on Dec. 19, as the Trump administration tests new ways to lower out-of-pocket drug costs for Americans on Medicare.

The first pilot program, Guarding U.S. Medicare Against Rising Drug Costs (GUARD), would apply an alternative approach to calculating prescription drugs for people on Medicare.

GUARD will examine drug prices in other countries, and if the United States discovers a drugmaker is charging more for the item in America, it may have to pay the government back.

The United States will reference prices in Australia, Austria, Belgium, Canada, the Czech Republic, Denmark, France, Germany, Ireland, Israel, Italy, Japan, the Netherlands, Norway, South Korea, Spain, Sweden, Switzerland, and the United Kingdom.

“Existing research finds that the prices of drugs sold in the United States are much higher than the prices of the same drugs sold in other countries,” the pilot program stated.

“One study finds that overall, the U.S. health care system spends substantially more on outpatient drugs for older adults with complex conditions, such as heart failure, diabetes, and chronic obstructive pulmonary disease (COPD), who are mostly covered by Medicare, than 11 other economically similar countries (including, for example, Australia, France, Germany, Canada, and the United Kingdom).”

The GUARD model would include drugs like antidepressants, antivirals, blood glucose regulators, cardiovascular agents, and gastrointestinal agents.

Spending on Medicare Part D drugs doubled in less than a decade, ballooning from $121 billion in 2014 to $276 billion in 2023, according to the Medicare Payment Advisory Commission (MedPAC).

The GUARD model would begin on Jan. 1, 2027, and end on Dec. 31, 2033. The “payment period” would be extended through December 2035.

The second test program, called Global Benchmark for Efficient Drug Pricing (GLOBE), will examine global price data to set patients’ out-of-pocket costs for certain drugs included in Medicare Part B, which would impact costs for treatments related to cancer, autoimmune diseases, eye disorders, and hormonal conditions.

GLOBE will launch on Oct. 1, 2026, and run through 2031.

The Dec. 19 announcement came as the Trump administration also said nine drugmakers had agreed to lower prescription drug costs in America.

“This represents the greatest victory for patient affordability in the history of American health care, by far, and every single American will benefit,” Trump said alongside health care executives at a ceremony inside the Roosevelt Room on Dec. 19.

“So, this is the biggest thing ever to happen on drug pricing and on health care. This will have a tremendous impact on health care itself.”

Reuters contributed to this report.