US Medicaid drug pricing plans will expand nationwide as the Trump administration prepares to extend its most-favored-nation model across the United States.
A White House official said President Donald Trump planned to announce the expansion on Friday. The model will cover all 50 states, the District of Columbia and Puerto Rico.
The plan aims to secure lower prices for some prescription medicines through rates linked to prices paid in other developed countries.
The United States currently pays more for prescription drugs than other countries, according to the administration. Trump has repeatedly called for a reduction in that gap.
Drugmakers agree to lower prices
The administration has already reached agreements with 17 major pharmaceutical companies.
Those companies include Pfizer, Eli Lilly and Novo Nordisk. Under the agreements, drugmakers agreed to offer certain medicines at prices comparable with those in other developed countries.
The administration refers to these arrangements as “most-favored-nation” pricing.
The latest expansion would bring the model to Medicaid programs across the country. Medicaid receives funding from both state and federal governments and provides health coverage for millions of low-income Americans.
Medicaid already receives drug discounts
The new approach would build on discounts that Medicaid already receives under federal law.
Drug manufacturers must provide Medicaid with significant rebates under existing rules. As a result, many Medicaid beneficiaries pay little out of pocket for prescription medicines.
However, the administration is seeking additional savings through agreements that tie prices to those paid in other wealthy nations.
The White House has presented the approach as part of a broader effort to reduce prescription drug costs in the United States.
More pricing agreements announced
The latest Medicaid announcement follows another round of drug-pricing agreements reached by the administration last month.
Those deals involved international pharmaceutical companies as well as some smaller biotechnology firms.
The administration has made prescription drug prices a major policy focus. It has argued that American consumers and government health programs often pay substantially more for medicines than patients in other developed countries.
The nationwide Medicaid model now adds another part to that strategy.
For Medicaid programs, the impact will depend on which medicines qualify and how the new pricing arrangements work alongside existing federal rebate requirements.
For now, the planned expansion covers the entire Medicaid system, including every state, Washington, DC and Puerto Rico.
