Trump Program Would Expand GLP-1 Coverage in Medicare, Medicaid

The Trump administration introduced Tuesday a new drug pricing model that seeks to allow Medicare Part D plans and state Medicaid agencies to cover GLP-1s, potentially expanding coverage for the medications treating obesity and diabetes.

The voluntary model, launched by the Centers for Medicare & Medicaid Services, would allow the agency to negotiate directly with pharmaceutical manufacturers of GLP-1 drugs for lower net prices and standardized coverage terms.

The negotiation areas include guaranteed net pricing and potential out-of-pocket limits for beneficiaries, standardized coverage criteria, and evidence-based lifestyle support offerings, according to a press release from the CMS.

The announcement builds upon President Donald Trump’s most-favored-nation plan that seeks to lower US drug prices by matching them to lower ones abroad, according to a statement from CMS Administrator Mehmet Oz.

“These actions further the administration’s bold plan to reform our country’s health systems and Make America Healthy Again,” Oz said. “With the BALANCE Model, we’re pairing breakthrough science with healthy living to cut costs while empowering Americans to take control of their health.”

Participation will be voluntary for manufacturers, states, and plans. The model will launch in Medicaid as early as May 2026 and in Medicare Part D in January 2027, according to the CMS.

The agency said it issued a request for applications to manufacturers, which are due Jan. 8, 2026.

Medicare in specific cases covers popular GLP-1s like Novo Nordisk A/S’ Ozempic and Wegovy, but only when they’re prescribed primarily for diabetes.

The model comes after the CMS introduced other proposals seeking to lower drug prices under government health plans.

The agency proposed two models on Dec. 19 seeking to cut Medicare spending. One would assess rebates for Medicare Part D drugs and the other for Part B drugs, if the prices exceed those paid in economically comparable countries.

The CMS in November also introduced a voluntary model that seeks to slash costs in Medicaid.

Trump has also been moving to lower the costs of GLP-1s in his most-favored-nation deals with drugmakers. He announced in November that Novo Nordisk’s drugs and Eli Lilly & Co.‘s Zepbound and Mounjaro will be priced at $245 for Medicare and Medicaid patients, which will launch in 2026.