Drug prices & Part D
CMS Finalizes Mandatory Model to Tie Medicare Part B Drug Prices to International Benchmarks
A five-year payment test launching January 1, 2027, will require drug manufacturers to pay rebates when what they charge Medicare exceeds prices paid in 19 other countries, affecting about one quarter of Original Medicare enrollees.
By the Goodsurance editorial teamOctober 1, 2026
The Centers for Medicare and Medicaid Services finalized the Global Benchmark for Efficient Drug Pricing model, known as GLOBE, on September 30, 2026. The model is mandatory for manufacturers of eligible Part B drugs and will run from January 1, 2027, through March 31, 2032.
Under GLOBE, CMS will compare what Medicare pays for certain physician-administered drugs to net prices paid for the same medicines in 19 reference countries, including Canada, Germany, Japan, and the United Kingdom. When the international benchmark is lower, manufacturers must pay a rebate that reduces net Medicare spending on those drugs.
CMS just finalized a program tying certain Medicare Part B drug prices to what 19 other countries pay. It covers about 1 in 4 Original Medicare enrollees and starts January 2027.
The model applies to a randomly selected group of ZIP code tabulation areas representing about 25 percent of Original Medicare Part B enrollees. Eligible drugs are single-source medicines and sole-source biologicals from oncology, rheumatology, immunology, ophthalmology, and endocrinology, each with at least 100 million dollars in annual Original Medicare spending. Biosimilars, orphan-only drugs, plasma-derived products, and certain cell and gene therapies are excluded.
CMS projects the model will produce 440 million dollars in net Medicare Part B spending savings over the seven-year payment period. For beneficiaries in participating areas, the practical effect would be a reduction in their 20 percent Part B drug coinsurance, since that share is calculated as a percentage of a lower effective price. CMS expects those savings to begin reaching enrollees starting April 1, 2027.
The GLOBE model is the latest step CMS has taken to narrow the gap between what Medicare pays for certain drugs and what other high-income countries pay for the same treatments.
In plain words
The federal government just finalized a new Medicare program called GLOBE. Starting January 1, 2027, it applies to some Medicare Part B drugs. Those are medicines given in a doctor's office or clinic, not picked up at a pharmacy. The program compares what Medicare pays for a drug to what 19 other countries pay for the same drug. If Medicare pays more, the drug company must pay Medicare a rebate. About 1 in 4 people on Original Medicare live in areas covered by this program. The program is expected to save Medicare 440 million dollars over seven years. People in those areas could pay a little less out of pocket for certain drugs starting April 1, 2027.
Understand the basics first
Source: CMS
Read at the source →