In a move aimed at easing the financial burden of prescription medications for older and disabled Americans, the U.S. Centers for Medicare & Medicaid Services (CMS) announced two new pilot programs on December 19, 2025. These initiatives, named GLOBE and GUARD, are designed to test whether applying international pricing benchmarks to drugs covered under Medicare can reduce out-of-pocket costs for beneficiaries while keeping access to treatments intact. The effort marks one of the most ambitious attempts yet by the federal government to directly confront the issue of high drug prices in the United States.
The Global Benchmark for Efficient Drug Pricing Model, or GLOBE, will focus on medications reimbursed under Medicare Part B, which covers drugs administered in clinical settings such as outpatient clinics and physician offices. These include some of the most expensive treatments in the healthcare system, including injectable cancer therapies, biologics for autoimmune diseases, and drugs for rare conditions. Starting in October 2026, GLOBE will tie the amount Medicare pays for these drugs to prices paid in other developed nations, many of which already use centralized price negotiation or regulation to keep pharmaceutical costs in check.
Under the GLOBE model, drug manufacturers will be required to offer rebates if the prices of their medications in the U.S. exceed the international benchmarks. The idea is to bring U.S. costs closer in line with global norms and reduce the share of expenses that patients are responsible for. While beneficiaries typically pay 20% coinsurance for Part B drugs, that amount can be substantial when the total drug price runs into the thousands of dollars per dose. CMS hopes the pilot will demonstrate that linking prices to international comparisons can generate savings without limiting access to innovative therapies.
The second initiative, GUARD, short for Guarding U.S. Medicare Against Rising Drug Costs, targets outpatient prescription medications covered under Medicare Part D. This program will begin in January 2027 and apply similar benchmarking strategies to retail drugs, including those used to treat chronic conditions such as diabetes, heart disease, and high blood pressure. GUARD aims to test whether adjustments to how rebates and discounts are structured can translate into lower costs for consumers at the pharmacy counter.
Together, the GLOBE and GUARD programs represent a significant policy shift in how the U.S. government approaches drug pricing, especially in the Medicare system. For decades, Medicare was largely restricted from negotiating drug prices directly, a constraint that critics argue has contributed to Americans paying more for medications than residents of any other high-income country. In recent years, political momentum has grown in favor of reform, driven by public frustration and the financial strain placed on seniors, many of whom rely on multiple medications.
Officials at CMS described the two pilots as part of a broader strategy to address systemic affordability challenges in the healthcare system. The launch of these programs builds on provisions of the Inflation Reduction Act of 2022, which gave Medicare new authority to negotiate prices for a limited number of high-cost drugs and capped annual out-of-pocket spending for Part D enrollees beginning in 2025. While those changes were hailed as landmark reforms, GLOBE and GUARD seek to expand the scope of pricing reform and test more comprehensive strategies.
The announcement of the programs came in the form of proposed rules, meaning CMS will accept public comments before finalizing implementation details. Stakeholders including pharmaceutical manufacturers, insurance providers, patient advocacy organizations, and healthcare economists are expected to submit input. How CMS chooses to respond to that feedback could shape the final structure of the programs and determine their long-term viability.
Predictably, reactions to the proposals have been mixed. Advocates for patients and consumer groups praised the initiative, calling it a necessary step to rein in drug prices that have become unsustainable for many families. Some pointed to the fact that drugs costing thousands of dollars in the U.S. can be found for a fraction of the price abroad, despite being produced by the same companies. They argue that aligning U.S. prices with international norms is both fair and overdue.
On the other hand, representatives from the pharmaceutical industry warned that such pricing models could stifle innovation by reducing revenue streams that fund research and development. Drugmakers contend that the U.S. market plays a key role in financing global pharmaceutical innovation and that adopting foreign price references could result in fewer new treatments coming to market. Industry trade groups are likely to challenge the pilot programs, possibly through legal action, depending on how CMS proceeds after the comment period.
Regardless of the debate, the stakes are high for the millions of Medicare beneficiaries who routinely face difficult choices between medication adherence and financial strain. Prescription costs remain a top concern among older Americans, many of whom live on fixed incomes and rely on Medicare to meet their healthcare needs. If GLOBE and GUARD prove effective, they could pave the way for more sweeping reforms that transform how drug pricing is handled across the U.S. healthcare system.
The pilot programs are scheduled to run through 2031, with ongoing evaluations and data collection to assess their impact. CMS officials say that the long timeline allows for careful measurement of the models’ effects on costs, access, and health outcomes. If successful, these models could eventually become permanent components of Medicare policy and influence broader drug pricing reform efforts at the federal level.
In launching GLOBE and GUARD, CMS is making a clear statement: the status quo in drug pricing is no longer acceptable. By leveraging international comparisons and testing new rebate structures, the agency hopes to deliver tangible savings to Medicare enrollees while maintaining the integrity of the healthcare system. The coming years will reveal whether these bold experiments can achieve the balance of affordability, access, and innovation that American patients have long been promised.
