WASHINGTON (AP) — President Donald Trump has announced plans to sign an executive order on Monday aimed at reducing medication costs by tying what Medicare pays for certain drugs to the lowest prices paid by other countries. This initiative is a revival of a failed effort from his first term that Trump has been advocating for even before becoming president.
In a social media post on Sunday, Trump revealed that the order will implement a “MOST FAVORED NATION’S POLICY,” requiring the United States to pay the same price as the country with the lowest drug prices globally. He emphasized that this policy would lead to significant cost reductions in healthcare for American citizens.
The proposed order is expected to impact specific drugs covered by Medicare that are administered in a doctor’s office, such as cancer treatments and injectables. Although Trump’s claim of saving “TRILLIONS OF DOLLARS” may be an exaggeration, the plan could result in substantial savings for the government.
Medicare, which provides health insurance for about 70 million elderly Americans, has long faced criticism for the high cost of drugs compared to other countries. Trump’s order would link drug prices paid by the federal government to those paid by economically advanced nations, known as the “most favored nation” approach.
However, the pharmaceutical industry is likely to strongly oppose the order, arguing that it could undermine their profits and hinder innovation in developing new medicines. Previous attempts by Trump to implement a similar rule during his presidency were met with legal challenges.
The order is expected to cover only drugs under Medicare Part B, which includes medications administered during doctor’s visits. Traditional Medicare enrollees currently have no annual out-of-pocket cap for these drugs, leading to significant spending. The new order is not expected to affect common prescription drugs filled at pharmacies.
Trump’s announcement comes after he teased a significant policy reveal last week, assuring that it was unrelated to trade or tariffs. His efforts to address high drug prices have been a long-standing focus of his presidency, with the aim of making healthcare more affordable for Americans.
On Sunday, Trump once again criticized the pharmaceutical industry, accusing them of exploiting Americans with high prices. He called out drug companies for shifting the blame onto consumers for their Research and Development costs, stating that these expenses were unjustly burdening the American people. Trump also highlighted the influence of drug companies’ lobbying efforts, asserting that while campaign contributions may have influence, they would not sway him or the Republican Party. He affirmed his commitment to taking the necessary steps to address the issue.
