Congress Shines Spotlight on Health Insurance Companies' Squeeze on Patients

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

The CEOs of four major insurance companies—UnitedHealth Group, CVS Health, Elevance Health, and Cigna—testified before the House Committees on Energy and Commerce and Ways and Means on Thursday, January 22nd, 2026. It went poorly for them.

Photo Source: Kent Nishumara | Bloomberg | Getty Images

It is rare in the Year of Our Lord Two-Thousand, and Twenty-Six, for congressional enemies to join the same team when questioning witnesses, but health insurance companies seem to be one of the few industries left where bipartisan enmity is shared. And with good reason.

UnitedHealth Group, CVS Health, Elevance Health, and Cigna’s most recent financial reports indicate annual revenue growth ranging from 7.8% (CVS) to 12% (UnitedHealth & Elevance), continuing the pattern of insurers delivering for shareholders, but failing to deliver for patients.

In a statement issued after the two hearings concluded, Brandon M. Macsata, CEO of ADAP Advocacy, stated:

Patients in America are facing unprecedented increases in premiums, deductibles, and co-payments, while insurance giants make out like bandits. After Congress allowed the enhanced premium subsidies enacted during the COVID-19 pandemic to expire, marketplace benchmark premiums increased by an average of 21.7%, compared with the 2% annual increases seen from 2020 through 2025. Meanwhile, premiums increased between 6% to 7% in the employer-sponsored insurance market. These marketplace premium increases are both unconscionable and discriminatory, as they specifically target the patients who most need insurance.

These premium hikes are likely to have an outsized effect on People Living with HIV/AIDS, as most state AIDS Drug Assistance Programs assist enrollees through insurance continuation and premium and co-pay assistance.

But the issue runs deeper than premiums—one of the key moments from these hearings included an exchange between Representative Alexandria Ocasio-Cortez (D-NY-14) and CVS Health CEO, David Joyner:

Rep. Ocasio-Cortez correctly identified, explained, and excoriated Joyner for what CVS Health Group refers to as their “captive strategy.”

Photo Source: Rep. Alexandria Ocasio-Cortez | YouTube

CVS Health Group not only owns CVS pharmacies, but also owns:

• Aetna
• The health insurance company providing insurance to over 36 million Americans (Aetna, 2026)
• Oak Street Health
• A system of primary care clinics serving over 350,000 people across 27 states (Oak St. Health, 2025)
• CVS Caremark
• A Pharmacy Benefit Manager (PBM) that negotiates prices for prescription medications, processing nearly 30% of all prescriptions in a given year for more than 110 million plan members in the United States (CVS Caremark, 2026); and,
• Cordavis
• A Dublin, Ireland-based drug maker that works with existing drug manufacturers to commercialize and/or co-produce biosimilar medications for the U.S. (CVS Health, 2023)

When asked whether this collection of companies constituted “market concentration,” Joyner responded:

No, I wouldn't agree that it's market concentration. I would suggest it's a model that works really well for the consumer” (Rep. AOC, 2026).

This response, so glibly delivered, is not unique; rather, it is typical of major corporations like Microsoft, Google, Meta (formerly Facebook), and Amazon, which control multiple companies within the same sector.

It all boils down to this argument:

“This isn’t a monopoly! No! It’s just…vertical integration! It’s what’s best for consumers!”

What they’re really saying is, “It’s what’s best for shareholders and my bank account.”

Over in the House Ways and Means Committee, Representative Greg Murphy (R-NC-03) stated unequivocally:

You have put profits above patients. And you have put profits above those who care for patients. You have squarely abused your position of authority to deliver healthcare to patients in this country (Parduhn, 2026).

Photo Source: WalletInvestor.com

Paul Markovich, CEO of the non-profit parent company that owns California Blues’ largest plan, was also present for these hearings, and spared no words in criticizing the American healthcare system:

Our healthcare system is bankrupting and failing us. I’ve come to the conclusion that the system will not fix itself. The healthcare system needs some tough love and clear direction, and the American government is in the best position to provide both (Parduhn, 2026).

Markovich truly hit the nail on the head here. The American healthcare system isn’t so much a system as it is a patchwork collection of profit-driven corporations, all of whom know that they have a captive market:

• Drug manufacturers actively navigate the U.S. patent system to extend patents beyond their initial time period, secure numerous patents to cover the same product, use secondary patents to cover dosage changes, formulation changes (e.g., capsule to tablet), and even delivery methods (e.g., adding dosage counters to inhalers; Tu & Rutschman, 2025). Critics argue that these practices allow manufacturers to maintain control over the available treatment market, justify price increases, and maximize profits.
• Health insurance companies actively utilize formulary management to deny access to life-saving medications either by excluding them from their formularies outright, creating labyrinthine prior authorization processes to access them, or forcing patients to switch to medications they deem as being “similar,” but which have not been actively prescribed as they are no longer the standard of care (Giebenhain, 2017).
• PBMs act as intermediaries between individual or group pharmacies, insurance companies, pharmaceutical companies, and drug wholesalers, each of which is attempting to either save money or make a profit by (Mattingly II et al., 2023):
• Designing formularies (i.e., determining which medications are available to patients)
• Managing drug utilization (e.g., creating prior authorization requirements, including step-therapy, supply limits, and/or tiering medications based on their list prices or utilization)
• Negotiating purchasing prices between pharmacies, wholesalers, and drug manufacturers
• Forming pharmacy networks that lock patients into purchasing covered medications at specific locations (e.g., speciality pharmacies)
• Providing mail-order pharmacy services

PBMs have come under consistent criticism over the past twenty years for creating market conditions that have limited competition. By 2023, 3 PBMs accounted for 79% of prescription drug claims in the U.S., and just 6 PBMs handle 96%. CVS Caremark accounted for 33% of all prescription drug claims, followed by Express Scripts (24%) and OptumRx (22%; Mattingly II et al., 2023).

Corporate profits soar; shareholders get paid; patients suffer.

This is the plight of the American Patient: getting left behind with more and more medical debt. Meanwhile, American life expectancy lags behind that of comparable nations (Sharfstein et al., 2024), even as we’re told we have “the best healthcare system in the world.”

Paul Markovich was right: the U.S. government is in the best position to fix the U.S. healthcare system. In all likelihood, however, it lacks the political will.

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association, but rather they provide a neutral platform whereby the author serves to promote open, honest discussion about public health-related issues and updates.

References:

[1] Aetna. (2026). About Us. Hartford, CT: CVS Health Group: Aetna: About Us. https://www.aetna.com/medicare/footers/about-us.html

[2] CVS Caremark. (2026). About Us. Woonsocket, RI: CVS Health Group: CVS Caremark: About Us. https://business.caremark.com/about-us.html

[3] CVS Health. (2023, August 23). CVS Health launches Cordavis. Woonsocket, RI: CVS Health Group: New: PBM. https://www.cvshealth.com/news/pbm/cvs-health-launches-cordavis.html

[4] Giebenhain, K. (2017, June). Dirty Laundry: Drug Formulary Exclusions. AMA Journal of Ethics, 19(6): 629-630. https://doi.org/10.1001/journalofethics.2017.19.6.imhl1-1706

[5] Mattingly II, T. J., Hyman, D. A., & Bai, G. (2023, November 03). Pharmacy Benefit Managers: History, Business Practices, Economics, and Policy. JAMA Health Forum, 4(11): e233804. https://doi.org/10.1001/jamahealthforum.2023.3804

[6] Oak Street Health. (2025, May). The Gold Standard of Advanced Primary Care for Medicare Beneficiaries. Chicago, IL: CVS Health Group: Oak Street Health. https://www.cvshealth.com/content/dam/enterprise/cvs-enterprise/pdfs/2025/Oak-Street-White-Paper-2025-v2.pdf

[7] Parduhn, R. P. (2026, January 23). Insurance CEOs’ no good, very bad day on the Hill. Newton, MA: Informa TechTarget: Industry Dive: Healthcare Dive: News. https://www.healthcaredive.com/news/health-insurance-ceos-house-hearings-affordability/810269/

[8] Representative Alexandria Ocasio-Cortez [RepAOC]. (2026, January 22). Rep. AOC Calls Out CVS Health’s Corporate Strategy to Monopolize Patient Care  [Video]. YouTube. https://www.youtube.com/watch?v=ayNKCNhoD7w

[9] Sharfstein, J., Gemmill, A., Appel, L., Angell, S., Saloner, B., Horwitz, J., Villareal, S., Alvarez, K., & Ehsant, J. (2024, December). A Tale of Two Countries: The Life Expectancy Gap Between the United States and the United Kingdom. Baltimore, MD: Johns Hopkins University: Johns Hopkins Bloomberg School of Public Health. https://americanhealth.jhu.edu/sites/default/files/2025-02/2024 Life Expectancy Report.pdf

[10] Tu, S. S. & Rutschman, A. S. (2025, November 14). Mapping Intellectual Property Abuses in the Pharmaceutical Field. JAMA Health Forum, 6(11): e254938. http://doi.org/10.1001/jamahealthforum.2025.4938

Trump Administration Applauds Itself for Rx Access Agreements, But Will They Help Patients?

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

In May 2025, President Donald J. Trump signed an executive order requiring, among other things, that pharmaceutical companies lower the prices of certain drugs to align with those charged in other comparably developed nations (e.g., most of Europe; Simons & Hopkins, 2025). Those companies that failed to comply with this order would be subject to administrative retaliation that imposes what the Trump Administration is calling “Most-Favored Nation” (MFN) pricing.

Photo Source: The White House

ADAP Advocacy covered this executive order last May, bringing several questions to the fore:

1. How will the U.S. Department of Health and Human Services (HHS) determine what the MFN price is for medications?
2. Which classes of medications and how many will be included in this pricing scheme?
3. Will these pricing agreements apply only to drugs purchased through public insurance programs, such as Medicaid, Medicare, and the Veterans Affairs (VA), or will these pricing agreements apply to drugs purchased using commercial insurance? (Franco, 2025)

In 2026, the Trump Administration’s "negotiations-at-gunpoint" approach has borne some fruit. The Trump Administration released a fact sheet late last year indicating that pricing and manufacturing agreements had been reached with 9 drug manufacturers (The White House, 2025). The details are available in the list below, which outlines each manufacturer’s agreement.

As with the executive order itself, the majority of the details of each manufacturer’s agreement with the Trump Administration are proprietary. What is striking about many of these deals is that the drugs sold direct-to-consumer are already off-patent, have cheaper biosimilars, or are no longer actively prescribed.

The latter is true for many of the medications used to treat HIV that will sold directly to patients, including Reyataz (Briston Myers Squibb; atazanavir), an oral protease inhibitor medication that was commonly used in combination with other medications, including Norvir (ritonavir; used to slow down the breakdown of Reyataz) and a nucleoside/nucleotide reverse transcriptase inhibitor (NRTI), such as Truvada (emtricitabine/tenofovir disoproxil fumarate).

Other drugs, such as Humira (Amgen), have multiple biosimilar options available at lower prices than Amgen's direct-to-patient pricing. Of greater concern is the possibility that these lower prices are merely stopgap measures that will remain in place only as long as the Trump Administration remains in office.

Photo Source: Houston Public Media | Win McNamee | Getty Images

While the optics of lower drug prices through forced “voluntary” negotiations look great on paper, most of these agreements come with three-year exemptions from tariffs imposed by the Trump Administration, which are currently facing a pending Supreme Court ruling on the legality of those tariffs under the International Emergency Economic Powers Act (IEEPA; Chung, 2026).

Should those tariffs be overturned by the Supreme Court or by a future president, drug manufacturers will have little incentive to honor many of the provisions of their respective deals, particularly U.S.-based manufacturing and research and development investments.

Further still, the opacity of these agreements, as well as HHS's determination of what “MFN” pricing is for individual drugs, means there remains little transparency into the drug pricing process. What’s to stop manufacturers from drastically increasing list prices to offset the “discounts” offered (Buntz, 2026)?

Finally, how many Americans will actually be able to access and afford these medications hinges on whether they have public (e.g., Medicaid, Medicare, VA) or commercial insurance (e.g., employer-sponsored, marketplace). While each manufacturer was voluntarily forced to sell medications on TrumpRx.gov, there is still no “TrumpRx”—the website is a placeholder site that promises “the lowest prescription drug prices in America,” but no details or actual drugs are listed. Instead, visitors are “graced” with a scowling (and AI-edited) photo of the president.

Photo Source: TrumpRx

The reality, here, is that Trump’s increasingly unpopular brand, as well as his long-documented failures to make good on the vast majority of his promises, are likely to drive away consumers, rather than convincing them to put their faith in anything with his name on it. But that’s the way of the day in our Trumpian dystopia: a power-hungry madman obsessed with branding everything with his name, like some heifer at the O.K. Corral.

In the short term, state Medicaid programs are the likeliest to benefit, as nearly every manufacturer has agreed to sell their medications to those programs at prices comparable to other developed nations (Lim, 2026). That will save states money, but most Medicaid patients already pay very low prices for most medications, meaning that the savings here are mostly to state governments rather than patients.

For direct-to-patient purchasing, while many patients may choose this route rather than enrolling in commercial insurance, for those who receive federal subsidies to offset monthly premiums, the complexity and secrecy of the U.S. healthcare system make it virtually impossible to determine whether patients will actually save money by skipping the middlemen.

ADAP Advocacy will continue to monitor MFN pricing and how that might impact people living with HIV/AIDS.

Drug Manufacturer MFN Agreement Outlines:

• Amgen
• Amgen will expand its direct-to-patient program, AmgenNow™, to include Aimovig® (migraine treatment) and Amjevita® (biosimilar to Humira to treat autoimmune conditions), at a discounted monthly price of $299. This expands the available drugs, which also includes Repatha® (cholesterol-lowering medication) at a monthly price of $239 (Amgen, 2025).
• Bristol Myers Squibb (BMS)
• BMS agreed to make Eliquis® (blood thinning medication) available to Medicare for free starting January 1st, 2026.
• Agreed to donate 7 tons of Eliquis to fill the U.S. Strategic Active Pharmaceutical Ingredient Reserve (SAPIR).
• Agreed to launch new medications with “…a more balanced pricing approach across developed nations”.
• Agreed to enable direct-to-patient access for cash-paying patients for Sotyktu® (plaque psoriasis), Zeposia® (relapsing multiple sclerosis and ulcerative colitis), Reyataz® (HIV), Baraclude® (Hepatitis B), Orencia® SC (autoimmune conditions).
• Each of these drugs will be sold at approximately 80% off the current list price through TrumpRx.gov (BMS, 2025).
• Boehringer Ingelheim
• Boehringer will offer medications directly to consumers through TrumpRx.gov
• Will sell Jentadueto (Type-2 Diabetes) for $55.
• Will invest $10 billion through 2028 to expand pharmaceutical research and development (R&D) and manufacturing operations in the U.S.
• Includes $1b specifically earmarked for capital expenditures (Boehringer Ingelheim, 2025).
• Genentech
• Genentech will provide medications to state Medicaid programs at prices comparable to other developed nations.
• Will allow certain drugs, including Xofluza (inflluenza) through TrumpRx.gov and through its recently established direct-to-patient program.
• Commits to increasing U.S. manufacturing, infrastructure, and R&D (Genentech, 2025).
• Gilead Sciences
• Gilead will offer discounts on certain existing medications, including those used to treat HIV, Hepatitis C, Hepatitis B, and COVID-19, for state Medicaid programs.
• Agreed to price future medications “…at parity” with other key developed nations.
• Will launch a direct-to-patient program for Epclusa® (Hepatitis C) at a discounted cash price that can be accessed through TrumpRx.gov (Gilead Sciences, 2025).
• GSK (formerly GlaxoSmithKline) / ViiV
• GSK will lower the prices of certain medications to state Medicaid programs, including most of its respiratory drug portfolio.
• GSK will also make most of its inhaled medications and other products available through a direct-to-patient program (TrumpRx.gov) at savings up to 66%.
• Will provide SAPIR with a reserve of albuterol (active ingredient in many inhalers used to treat asthma and chronic obstructive pulmonary disorder [COPD]; GSK, 2025).
• Merck
• Merck will provide direct-to-patient access to Januvia (Type-2 Diabetes), Janumet (Type-2 Diabetes), and Janumet XR through TrumpRx.gov.
• This will be expanded to include enlicitide decanoate, an investigational drug currently being developed to lower cholesterol, once it has received approval from the U.S. Food and Drug Administration (FDA; Merck, 2025).
• Novartis
• Novartis agreed to launch future medications at prices comparable with other developed nations.
• Will build direct-to-patient platforms for Mayzent (multiple sclerosis), Rydapt (acute myeloid leukemia and rare blood disorders), and Tabrecta (metastatic non-small cell lung cancer) through TrumpRx.gov.
• Will apply to participate in the GENEROUS (GENErating cost Reductions fOr U.S. Medicaid) model announced by the Trump Administration in November 2025 (HHS, 2025) aimed at improving access to medications through state Medicaid programs.
• Will support efforts to “…address the global imbalance in investment in pharmaceutical innovation” (Novartis, 2025).
• Sanofi
• Sanofi agreed to ensure that state Medicaid programs can access Sanofi medications at the same prices as other developed nations.
• Will reduce prices by an average of 61% for certain medications used to treat diabetes, cardiovascular and neurological conditions, and cancer.
• Will offer direct-to-patient access for certain drugs through TrumpRx.gov.
• Will implement a “…more balanced approach” on pricing in other nations.
• Agreed to increase investments in upgrading existing manufacturing facilities and expand manufacturing partnerships (Sanofi, 2025).

In addition to these companies, the Administration has entered into pricing and manufacturing agreements with:

• AbbVie
• AbbVie agreed to spending $100 billion in U.S. R&D and other capital investments over the next decade.
• Will provide “low prices” to state Medicaid programs.
• Will provide direct-to-consumer access to Humira (rheumatoid arthritis), Alphagan (glaucoma or ocular hypertension), Combigan (glaucoma or ocular hypertension), and Synthroid (hyperthyroidism) through TrumpRx.gov (Fidler, 2026).
• AstraZeneca
• AstraZeneca will provide direct-to-consumer sales to eligible patients with chronic diseases at a discount of up to 80% off list prices through TrumpRx.gov.
• Will invest $50 billion in manufacturing and R&D through 2030, 50% of which is expected to be generated in the U.S. (AstraZeneca, 2025).
• .ohnson & Johnson (J&J)
• J&J will provide direct-to-patient access through TrumpRx.gov.
• Will “…[enable] American patients to access medicines at comparable prices to other developed countries”.
• Will provide state Medicaid programs with access to medications at prices comparable to other developed nations.
• Announced two new U.S. manufacturing facilities in Pennsylvania and North Carolina (J&J, 2026).
• Eli Lilly
• Eli Lilly and Company will provide Medicare beneficiaries with Zepbound (weight management GLP-1 medication) and orforglipron, an investigational oral GLP-1 drug awaiting FDA approval, for no more than $50/month.
• State Medicaid programs will also be able to access these medications at reduced prices (prices not stated).
• Will enable self-paying (cash-paying) patients to access Zepbound at its lowest dose for $299, with additional doses up to $449 through direct-to-patient access, representing a $50 savings.
• Patients refilling their multi-dose pens will pay no more than $449.
• Will provide direct-to-patient orforglipron at the lowest dose for $149, with additional doses up to $399.
• Nota bene – the scope of this agreement DOES NOT include commercial pricing.
• Will add Emgality (migraines and cluster headaches), Trulicity (Type-2 Diabetes), and Mounjaro (specific to Type-2 Diabetes) to direct-to-patient channels at 50-60% off current list prices.
• Will continue to offer insulin to patients for no more than $35/month, whether a patient is commercially insured or uninsured (Eli Lilly, 2025).
• Pfizer
• Pfizer agreed to implement measures to ensure Americans receive “…comparable drug prices to those available in other developed countries,” and will price new medications at parity with other developed markets.
• Will participate in direct-to-patient sales through TrumpRx.gov, allowing Americans to purchase primary care treatments and specialty drugs at an average discount of 50% and at discounts of up to 85%.
• Committed to investing an additional $70 billion in the U.S. for R&D and capital projects over the next few years (Pfizer, 2025).

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association, but rather they provide a neutral platform whereby the author serves to promote open, honest discussion about public health-related issues and updates.

References:

[1] Amgen. (2025, December 19). Amgen takes action with the U.S. government to lower the cost of medicines for American patients. Thousand Oaks, CA: Amgen: Newsroom: Press Releases. https://www.amgen.com/newsroom/press-releases/2025/12/amgen-takes-action-with-the-u-s--government-to-lower-the-cost-of-medicines-for-american-patients

[2] AstraZeneca. (2025, October 10). AstraZeneca announces historic agreement with US Government to lower the cost of medicines for American patients. Cambridge, UK: AstraZeneca: Media Centre: Press Releases. https://www.astrazeneca.com/media-centre/press-releases/2025/astrazeneca-announces-historic-agreement-with-us-government-to-lower-the-cost-of-medicines-for-american-patients.html

[3] Boehringer Ingelheim. (2025, December 19). Boehringer Ingelheim announces broad agreement with the U.S. Government to lower the cost of medicines for American patients and expand its U.S. footprint. Ridgefield, CT: Boehringer Ingelheim: US: Media: Press Releases. https://www.boehringer-ingelheim.com/us/media/press-releases/boehringer-ingelheim-announces-agreement-us-government

[4] Bristol Myers Squibb. (2025, December 19). Bristol Myers Squibb Announces Agreement with U.S. Government to Improve Affordability and Access to Critical Medicines for Americans. Princeton, NJ: Bristol Myers Squibb: News: Corporate/Financial News. https://news.bms.com/news/corporate-financial/2025/Bristol-Myers-Squibb-Announces-Agreement-with-U-S--Government-to-Improve-Affordability-and-Access-to-Critical-Medicines-for-Americans/default.aspx

[5] Buntz, B. (2026, January 02). Drug companies sign “Most Favored Nation” deals, then raise prices anyway. Cleveland, OH: WTWH Media LLC: Drug Discovery & Development. https://www.drugdiscoverytrends.com/drug-companies-sign-most-favored-nation-deals-then-raise-prices-anyway/

[6] Chung, A. (2026, January 09). Supreme Court plans rulings for January 14 as Trump's tariffs remain undecided. London, UK: Reuters: Legal: Government. https://www.reuters.com/legal/government/supreme-court-set-issue-rulings-trump-awaits-fate-tariffs-2026-01-09/

[7] Eli Lilly and Company. (2025, November 06). Lilly and U.S. government agree to expand access to obesity medicines to millions of Americans. Indianapolis, IN: Eli Lilly and Company: News Releases. News Release Details. https://investor.lilly.com/news-releases/news-release-details/lilly-and-us-government-agree-expand-access-obesity-medicines

[8] Fidler, B. (2026, January 13). AbbVie pledges $100B to US production in drug pricing deal with Trump. Newton, MA: Industry Dive: Biopharma Dive: News. https://www.biopharmadive.com/news/abbvie-drug-price-deal-trump-most-favored-nation/809441/

[9] Franco, M. A. (2025, May 14). Trump Administration Revives Most-Favored-Nation Drug Pricing: Here's What to Know. Holland & Knight: Insights. Retrieved from https://www.hklaw.com/en/insights/publications/2025/05/trump-administration-revives-most-favored-nation-drug-pricing

[10] Genentech. (2025, December 19). Genentech Announces Agreement With U.S. Government. South San Francisco, CA: Genentech: Media: Press Releases. https://www.gene.com/media/press-releases/15094/2025-12-19/genentech-announces-agreement-with-us-go

[11] Gilead Sciences. (2025, December 19). Gilead and U.S. Government Enter Agreement to Lower Costs of Medicines for Americans. Foster City, CA: Gilead Sciences: News: News Releases. https://www.gilead.com/news/news-details/2025/gilead-and-u-s--government-enter-agreement-to-lower-costs-of-medicines-for-americans

[12] GSK. (2025, December 19). GSK enters agreement with U.S. government to lower drug prices and expand access to respiratory medicines for millions of Americans. London, UK: GSK: Media: Press Release Archive. https://www.gsk.com/en-gb/media/press-releases/gsk-enters-agreement-with-us-government-to-lower-drug-prices-and-expand-access-to-respiratory-medicines-for-millions-of-americans/

[13] Johnson & Johnson. (2026, January 08). Johnson & Johnson Reaches Agreement with U.S. Government to Improve Access to Medicines and Lower Costs for Millions of Americans; Delivers on U.S. Manufacturing and Innovation Investments. New Brunswick, NJ: Johnson & Johnson: Media Center: Press Releases. https://www.jnj.com/media-center/press-releases/johnson-johnson-reaches-agreement-with-u-s-government-to-improve-access-to-medicines-and-lower-costs-for-millions-of-americans-delivers-on-u-s-manufacturing-and-innovation-investments

[14] Lim, D. (2026, January 04). Trump’s drug-pricing deals won’t benefit most Americans today. They could over time. Politico: News. https://www.politico.com/news/2026/01/04/trumps-drug-pricing-deals-wont-benefit-most-americans-today-that-could-over-time-00706529?cid=Connatix

[15] Merck. (2025, December 19). Merck Reaches Agreement With U.S. Government to Expand Access to Medicines and Lower Costs for Americans. Rahway, NJ: Merck: Media: News Releases. https://www.merck.com/news/merck-reaches-agreement-with-u-s-government-to-expand-access-to-medicines-and-lower-costs-for-americans/

[16] Novartis. (2025, December 19). Novartis and US government reach agreement on lowering drug prices in the US. Basel, CH: News. https://www.novartis.com/news/media-releases/novartis-and-us-government-reach-agreement-lowering-drug-prices-us

[17] Pfizer. (2025, September 30). Pfizer Reaches Landmark Agreement with U.S. Government to Lower Drug Costs for American Patients. New York, NY: News: Press Release. Press Release Details. https://www.pfizer.com/news/press-release/press-release-detail/pfizer-reaches-landmark-agreement-us-government-lower-drug

[18] Sanofi. (2025, December 19). Press Release: Sanofi reaches agreement with the US government to lower medicine costs while strengthening innovation. Paris, FR: Sanofi: English: Media Room: Press Releases. https://www.sanofi.com/en/media-room/press-releases/2025/2025-12-19-19-21-43-3208697

[19] Simons, R. & Hopkins, M. J. (2025, May 22). Is Trump's executive order on Most Favored Nations drug pricing a wet noodle? Nags Head, NC: ADAP Advocacy. https://adapadvocacyassociation.blogspot.com/2025/05/is-trumps-executive-order-on-most.html

[20] United States Department of Health and Human Services. (2025, November 06). CMS Announces New Drug Payment Model to Strengthen Medicaid and Better Serve Vulnerable Americans. Washington, DC: United States Department of Health and Human Services: Press Room. https://www.hhs.gov/press-room/cms-announces-new-drug-payment-model-to-better-serve-vulnerable-americans.html

[21] White House, The. (2025, December 19). Fact Sheet: President Donald J. Trump Announces Largest Developments to Date in Bringing Most-Favored-Nation Pricing to American Patients. Washington, DC: The White House: Fact Sheets. https://www.whitehouse.gov/fact-sheets/2025/12/fact-sheet-president-donald-j-trump-announces-largest-developments-to-date-in-bringing-most-favored-nation-pricing-to-american-patients/

Trump Administration Pushes Two New Rebate Models, But Will They Help Patients?

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

The Centers for Medicare and Medicaid Services (CMS) has released information about a new proposed mandatory pricing model—the Guarding U.S. Medicare Against Rising Drug Costs (GUARD) Model—that would assess the inflation rebate amounts paid for certain medications covered under Medicare Part D using a benchmark derived from international pricing information rather than using current domestic benchmarks (CMS, 2025).

Photo Source: CMS

The GUARD model is one of two pricing models being proposed by the Trump Administration—the other being the Global Benchmark for Efficient Drug Pricing (GLOBE), which would assess inflation rebates for drugs covered under Medicare Part B.

In both models, the Trump Administration plans to use modeling to employ drug “rebate models,” which are payment models ostensibly intended to lower the cost of medications by having drug manufacturers return a percentage of the purchase price to the buyers. These rebates are generally negotiated behind closed doors between payors, including pharmacy benefit managers (PBMs), insurers, and government programs, with drug manufacturers. Once those rebate amounts are set, drug manufacturers remit rebate payments to payors only after the drugs have been purchased and dispensed (SmithRx, 2025).

CMS's GUARD Model would attempt to reduce Medicare drug spending by tying prices to international benchmarks and collecting rebates from manufacturers when prices exceed those. 

Rebates, such as the proposed 340B Drug Pricing Program rebate model, can be an effective means of introducing cost savings into health care systems and indirectly helping patients, because they bring added transparency. In the case of the GUARD Model, they can also disadvantage patients. That is because the rebated price is not known at the time that the patient is dispensed the medication. Accordingly, out-of-pocket costs are calculated based on the higher "list" prices of drugs, forcing patients to pay more in deductibles, coinsurance, and copayments at the pharmacy counter.

In essence, the wider health care system may benefit from a rebate, but the patient may see no reduction in their costs. The 340B rebates differ from GUARD/GLOBE in that 340B rebates are specifically designed to be passed onto the consumer in the form of increased investment in/access to/savings for healthcare services. GUARD/GLOBE rebates are specifically designed to go to payors, with no requirements whatsoever that those revenues be reinvested or savings passed on.

Drug rebate models have been in place in the U.S. since the 1990s, with the creation of the Medicaid Prescription Drug Rebate Program (MDRP) under the Omnibus Reconciliation Act. They are also actively used in at least 31 European countries, including Italy, Portugal, Spain, France, Germany, and the United Kingdom (Vogler et al., 2012).

Photo Source: ADAP Advocacy | iStock

The primary rationale behind these rebate models is that requiring manufacturers to pay rebates to payors incentivizes drug manufacturers to keep drug prices lower. While this might be true in nations where this is a single payor, such as those listed above, rebate models in the U.S. have objectively poorer outcomes.

Recent research from the Leonard D. Schaeffer Institute for Public Policy & Government Service out of the University of Southern California found that, on average, every $1 increase in rebates was associated with $1.17 increase in list prices, particularly for single-source drugs—a Food and Drug Administration (FDA)-approved medication available from only one manufacturer, often lacking a generic equivalent, and specifically the types of drugs that will be evaluated under both the GUARD and GLOBE models being proposed (Sood et al, 2020).

Another study examined rebates for 444 unique branded medications and found that, while drug manufacturers may increase list prices in order to offer larger rebates to payors, consumers—particularly those lacking health insurance coverage—experienced statistically significant increases in out-of-pocket costs for those medications (Yeung et al., 2021).

Decades of research confirm what people living with HIV/AIDS already know: out-of-pocket costs lead to skipped doses, delayed refills, or complete abandonment of prescriptions. 

Public health data from the Centers for Disease Control show that a significant share of people living with HIV/AIDS (PLWHA) report cost-related non-adherence. A 2019 study found that 7% of PLWHA in the U.S. reported non-adherence to prescribed dosing due to cost-related concerns, with another 4% reporting skipping doses, 4% reporting taking less medicine, and 6% reporting delaying medication purchases (Beer et al., 2019).

Sadly, PLWHA facing affordability challenges may delay or abandon medications because they are unable to afford out-of-pocket costs.  These cost-saving behaviors are directly associated with lower rates of viral suppression, poorer health outcomes, and increased strain on the healthcare system.

Research has also demonstrated that very small cost-sharing amounts can have outsized effects. Studies examining HIV prevention and treatment medications have found that prescription abandonment rates rise sharply when out-of-pocket costs increase from $0 to even $10 (Dean et al., 2024). Persistence on therapy drops as costs rise—a finding that should concern everyone.

Photo Source: ADAP Advocacy | iStock

Put simply, when patients pay more, adherence suffers, and people's health suffers.

In order for rebates to truly result in lower costs for consumers, the U.S. would need to do away entirely with our multi-payor healthcare model, which requires different payors (both for-profit and government-based) each have to enter into pricing and rebate negotiations with drug manufacturers to set prices and rebate amounts.

Pressure campaigns are effective only when pressure is applied from all sides. While drug manufacturers are unlikely to abandon a revenue cash cow like the Medicare program, they still have non-Medicare-enrolled consumers onto whom they can push increased drug prices with few to no negative outcomes. Consumers have come to not only accept but also expect medication price inflation, especially when there are few, if any, viable comparable alternative therapies available to them.

What the GUARD and GLOBE programs are intended to do is force manufacturers to provide higher rebates for medications that CMS deems “too expensive.” This, they posit, will result in lower drug costs for seniors and those non-seniors who rely on Medicare for drug coverage. The reality is that those consumers will likely realize few, if any, net savings from these programs, so long as there are multiple payors willing to pay whatever price is needed to move medications to their customers.

Although the GUARD proposal may seem promising to some, it does not require that these rebates be automatically passed on to patients in the form of lower out-of-pocket costs. That central problem needs to be addressed before the proposal is finalized and implemented.

The proposal states that it hopes that lower GUARD prices will benefit patients. The proposal says that "[i]t is possible that in response to the alternative payments]" GUARD creates manufacturers might "reduce their net price" in an effort to reduce the GUARD Model rebate payments. If so, then there might be some chance that patients would benefit from the GUARD prices. 

But the "possibility" that GUARD "might" help patients at the pharmacy counter just is not good enough. ADAP Advocacy plans to submit public comment in response to these proposals that address the patient perspective.

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association, but rather they provide a neutral platform whereby the author serves to promote open, honest discussion about public health-related issues and updates.

References:

[1] Beer, L., Tie, Y., Weiser, J., & Shouse, R. L. (2019, December 13). Nonadherence to Any Prescribed Medication Due to Costs Among Adults with HIV Infection — United States, 2016–2017. Morbidity and Mortality Weekly Report, 68(49): 1,129-1,133 http://dx.doi.org/10.15585/mmwr.mm6849a1

[2] Centers for Medicare and Medicaid Services. (2025, December 29). GUARD (Guarding U.S. Medicare Against Rising Drug Costs) Model. United States Department of Health and Human Services: Centers for Medicare and Medicaid Services: Priorities: Overview: Innovation Models. https://www.cms.gov/priorities/innovation/innovation-models/guard

[3] Dean, L. T., Nunn, A. S., Chang, H. Y., Bakre, S., Goedel, W. C., Dawit, R., Saberi, P., Chan, P. A., & Doshi, J. A. (2024). Estimating The Impact Of Out-Of-Pocket Cost Changes On Abandonment Of HIV Pre-Exposure Prophylaxis. Health affairs (Project Hope), 43(1), 36–45. https://doi.org/10.1377/hlthaff.2023.00808

[4] SmithRx. (2025, March 21). How Drug Rebates Influence Prescription Costs for Employers. San Francisco, CA: SmithRx. https://smithrx.com/blog/how-drug-rebates-influence-prescription-costs-for-employers

[5] Sood, N., Ribero, R., Ryan, M., & Van Nuys, K. (2020, February 11). The Association Between Drug Rebates and List Prices. Los Angeles, CA: University of Southern California: Leonard D. Schaeffer Institute for Public Policy & Government Service. https://schaeffer.usc.edu/research/the-association-between-drug-rebates-and-list-prices/ 

In Memoriam: Edward "Rick" Macsata

By: Brandon M. Macsata, CEO, ADAP Advocacy

The ADAP Blog has a longstanding tradition of presenting facts about policy issues, typically in the third person. On a rare occasion, our blog presents "opinion" pieces, and even more rarely, about something personal. I ask that you please indulge me this week to share some personal news about the passing of my father, Edward "Rick" Macsata.

Edward "Rick" Macsata

I do so because my father had a keen interest in ADAP Advocacy, not only because his son was the CEO. Upon learning about my HIV-diagnosis, my father asked me to educate him about the condition. I recall using a diagram shared by Dr. Princy N Kumar, chief of the Division of Infectious Diseases and Travel Medicine at MedStar Georgetown University Hospital, during one of her presentations at an ADAP Conference. When news stories would post about a possible cure, he would ask me if it was real.

My father met and relished in conversation with William "Bill" Arnold, Edward "Eddie" Hamilton, and Brent Shimmin, all of whom he will now join in Heaven. In fact, he met many of the people reading this memorial.

My father and my mother donated financially to the organization annually. He attended a congressional briefing hosted by ADAP Advocacy in Washington, DC, where he met former Senator Richard Burr (R-NC) and former Representative Donna Christensen (D-VI). He attended multiple wine-tasting fundraisers in the early years of our organization. He read nearly every report published by our organization, and most recently, he absolutely loved our 340B commercials, asking me why we couldn't run them in Connecticut so he could see them.

On January 6, 2026, at 10:02 a.m., my father hit the apex of the surly bounds of Earth, most likely straddling his 2006 Harley-Davidson Electra Glide, listening to Waylon Jennings’ "Good Hearted Woman." A lifelong resident of Torrington, Connecticut, he was known to those who knew and loved him as Rick, and they undoubtedly appreciated his unmatched precision with a measuring tape or construction levels. My father had two true loves in his life: my mother and her cooking. God called my father home, waving the checkered flag for the last time. Few could match his grasp and navigational prowess with an old-fashioned Atlas. Yet over the forty years since their mainstreaming in American households, almost anyone could operate a microwave oven better than he could. The stove was his nemesis, but a circular saw sang to him better than any music by the supergroup, The Highwaymen. He was stubborn, yet humble. He was stern, yet a big teddy bear. He was an immovable object, yet light as a feather. He was always right, followed only by admitting he was wrong. His life’s simple pleasures included lemon meringue pie, NASCAR, Kansas City Chiefs’ games on fall Sunday afternoons, Landline truckers’ magazine, Yuengling, Asiago Cheese, Clams Casino, grilled hamburgers, skiing, car roadshow programs, or watching sailboats on the Atlantic Ocean. But few things in his life brought him more joy than my mom’s kisses or his grandson’s intoxicating laughter. My father’s transition to the After Life, though a loss to those close to him, means Heaven has now added a devoted husband, loving father, and grandfather for the ages.

Grandpa with his little guy, Sebastian

No amount of education, career achievements, or lived experience can prepare us for the loss of a parent.

This summer, I gave my father the song by Luke Combs, “My Old Man Was Right,” because I knew in my heart that I was losing him to cancer. It was a painful self-admission, and it made me look inward at my feelings toward him. No words can express the gratitude that I hold in my heart for my father. Sometimes, I’m told that I'm too compassionate with people and that I offer to help too much. But I learned that compassion from my father. As a kid, I remember him helping a woman in need at the market when her car wouldn’t start. I'm often told that I work too hard. But I learned that work ethic from my father. As a kid, I remember how he poured his soul into every project. I also remember him always offering a helping hand to virtually anyone who walked into his life. He fixed my friend’s bike. He fixed our neighbor’s lawnmower. He fixed cars. He fixed faucets. I’m always helping the people in my life because that is all I ever saw my father do. I had the opportunity to share with my father that I am the man that I am today because he helped to shape me. 

Rest in peace, dad.

Edward "Rick" Macsata's Obituary: https://www.cookfuneralhomect.com/obituaries/edward-rick-macsata

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association, but rather they provide a neutral platform whereby the author serves to promote open, honest discussion about public health-related issues and updates.