Lowering Prescription Drug Costs for Americans
Executive Order 14087, titled Lowering Prescription Drug Costs for Americans, directs the Secretary of Health and Human Services (HHS) to expand and test new health care payment and delivery models via the Center for Medicare and Medicaid Innovation (Innovation Center). The goal is to reduce prescription drug costs for beneficiaries enrolled in Medicare and Medicaid by exploring models that may lower drug costs and share the benefits of improved care. The order frames this as a continuation of prior anti-drug-cost efforts (including the Inflation Reduction Act) and signals that HHS should identify and test models, with a concrete 90-day reporting deadline and subsequent actions to implement testing. In short, this executive order acts as a push to accelerate experimentation with payment and delivery approaches that could reduce drug costs for government programs and their beneficiaries, while staying within existing law and budget constraints. It does not itself impose new law or create individual rights, but it directs federal agencies to pursue specific testing and reporting steps.
Key Points
- 1Policy focus and rationale: Acknowledges high prescription drug costs in America and references prior actions (Executive Order 14036 and the Inflation Reduction Act) as a foundation for further steps to lower costs, including through testing new models.
- 2HHS actions and Innovation Center role: Requires the Secretary to consider selecting new health care payment and delivery models for testing that could lower drug costs and promote access to innovative therapies for Medicare and Medicaid beneficiaries, including potential reductions in cost-sharing and support for value-based payment.
- 390-day reporting requirement: The Secretary must, within 90 days, submit to the Assistant to the President for Domestic Policy a report enumerating any selected models and detailing a plan and timeline to test them; subsequent actions to test these models must follow.
- 4Relationship to existing laws: The order is designed to complement the Inflation Reduction Act and other ongoing efforts, leveraging existing authorities and programs rather than creating new entitlements or rights.
- 5General provisions and limits: Reaffirms that the order does not override statutory authorities, is to be implemented consistent with law and appropriations, and does not create enforceable rights or benefits in litigation.