President Donald Trump issued a flurry of executive orders during the first day of his second term, including a single sweeping order revoking dozens of executive orders issued by the Biden administration.
Viral socialmedia posts claim that one of the orders revoked was one that lowered prescription drug costs for people on Medicare and Medicaid. Several VERIFY readers asked us if these posts are true.
THE QUESTION
Did Trump rescind a Biden order to lower prescription costs for people on Medicare and Medicaid?
THE SOURCES
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Trump executive order “Initial Rescissions of Harmful Executive Orders and Actions”
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Biden executive order 14087 “Lowering Prescription Drug Costs for Americans”
THE ANSWER
Yes, Trump did rescind a Biden order to lower prescription costs for people on Medicare and Medicaid.
WHAT WE FOUND
Trump rescinded an executive order that required the Center for Medicare and Medicaid Services (CMS) to develop and test ways to lower drug prices for people on Medicare and Medicaid.
Since former-President Joe Biden’s 2022 order, CMS had been planning out and preparing to test three models to lower prices. None of them had fully gone into effect. Therefore, current Medicare and Medicaid enrollees will not see their drug prices go up. They will also not see some of the proposed price cuts scheduled to go into effect in the future.
Among the executive orders Trump rescinded during his first day of office is Executive Order 14087, which was an October 2022 order by Biden on “Lowering Prescription Drug Costs for Americans.”
That executive order directed the Secretary for the Department of Health and Human Services (HHS) to consider and test “new health care payment and delivery models that would lower drug costs and promote access to innovative drug therapies for beneficiaries enrolled in the Medicare and Medicaid programs.”
CMS ultimately selected to test three models with the goal of improving prescription drug affordability and access for beneficiaries.
The first proposed model encouraged sponsors of Medicare Part D, which provides prescription coverage to Medicare enrollees, to offer generic drugs for a $2 monthly copay, with a focus on generics targeting common chronic conditions among Medicare beneficiaries. CMS said this pricing was scheduled to begin as early as January 2027.
The second proposed model created a voluntary pricing agreement between drug manufacturers and state Medicaid agencies designed to increase access to and the affordability of cell and gene therapies, which can be highly effective but also expensive. States were scheduled to begin participation this month and throughout the year.
The final proposed model would have had Medicare pay less for drugs that receive accelerated approvals from the Food and Drug Administration (FDA). The FDA grants accelerated approvals to promising drugs to make them available for patients sooner, before they’ve completed final trials to confirm the drugs work. CMS says its goal would be to encourage drugmakers to complete these trials by paying less for drugs that haven’t completed the trials. This proposal did not have a scheduled start date.
With Trump’s rescinding of Biden’s order, the fate of these three models is unclear. CMS did not respond to VERIFY’s request for clarification prior to publishing.
Trump also revoked multiple Biden executive orders designed to expand affordable health coverage, particularly through the Affordable Care Act and Medicaid.
Other affordable drug policies, such as the $35 per month cap on insulin costs, were not affected by Trump’s executive order.