CMS is touting its Most Favored Nation (MFN) proposals as a way to make prescription medicines more affordable for seniors. But a closer look shows the policy is unlikely to lower patients’ out‑of‑pocket costs—and could even leave some seniors and people with disabilities paying more.
The promise—and the problem:
CMS claims its GLOBE and GUARD proposals will cut seniors’ costs by tying Medicare medicine payments to international prices. It would do this by requiring manufacturers to pay rebates to the government whenever Medicare prices are higher than those set by foreign governments.
One key problem: these proposals do almost nothing to reduce what seniors actually pay.
- Nearly all Medicare Fee for Service beneficiaries already have supplemental Part B coverage that limits their out-of-pocket costs. As a result, this policy would not meaningfully change what many seniors pay.
- Under Medicare Part D, the gap between promise and reality is even clearer. CMS has acknowledged that the collected rebates would not be shared with patients at the pharmacy counter. More troubling, the government’s own projections suggest patients could actually see higher costs under this policy.
That directly contradicts the policy’s stated goal. An affordability fix shouldn’t risk higher costs or added uncertainty for seniors, especially those living on fixed incomes.
The bottom line
These MFN proposals may reshuffle payments in Washington, but they don’t fix what seniors actually pay at the pharmacy or the doctor’s office. To meaningfully lower costs for Americans, policymakers need to address the real drivers of high health care spending—insurers and middlemen, abuses in the 340B hospital markup program, and the fact that foreign governments underpay for medicines. Focusing on these issues is how the country can deliver real, lasting reductions in patients’ out-of-pocket costs.
Brianna Allen
Brianna is a Senior Director on PhRMA’s Public Affairs team focusing on communications strategies and activities around Medicare, Medicaid and access to medicines. Prior to joining PhRMA, she served as a strategic communications advisor at the FDA’s Center for Devices and Radiological Health and worked as a director of strategic communications on FGS Global’s health care team. She started her career in journalism and spent nearly a decade covering domestic policy issues, including federal health policy for POLITICO. She enjoys spending time outdoors exploring Northern Virginia with her husband, two toddlers and corgi puppy.
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