Medicare's New Trick: Benchmarking Drugs Against Global Prices
Published Date: 12/23/2025
Proposed Rule
Summary
The GLOBE Model is a new plan to help Medicare pay less for certain medicines by using a global price benchmark. This change affects Medicare patients and drug makers, aiming to save money while keeping care quality high. Comments on this plan are open until February 23, 2026, so everyone has a chance to weigh in before it moves forward.
Analyzed Economic Effects
4 provisions identified: 2 benefits, 1 costs, 1 mixed.
Manufacturers must pay GLOBE rebates based on global prices
CMS proposes mandatory participation for all manufacturers of Part B rebatable drugs that are designated as GLOBE Model drugs; those manufacturers would pay GLOBE Model rebates into the Medicare Part B account when the specified amount exceeds a benchmark based on international drug pricing. CMS states the benchmark-based GLOBE Model rebate would not be less than any rebates owed under the existing Medicare Part B Drug Inflation Rebate Program, and manufacturers may submit a Suggestion of Error only for mathematical errors.
CMS estimates multi-billion dollar Medicare savings
CMS estimates the GLOBE Model would reduce overall Medicare Part B net spending by $11.9 billion over the 7-year model period, including about $8.4 billion in Medicare Part B FFS savings, $7.5 billion in Medicare Advantage savings, and about $4.0 billion in premium offset impacts; CMS also estimates about $1.0 billion in Medicaid savings (roughly $0.7 billion federal and $0.3 billion state). When annualized, CMS estimates approximately $2.3 billion in Medicare Part B FFS savings over the 7-year period.
Selected Medicare patients get lower coinsurance
About 25 percent of traditional Medicare Part B fee-for-service beneficiaries in selected geographic areas would be placed in the GLOBE Model cohort. When those beneficiaries receive an included GLOBE Model drug on an applicable date of service, their coinsurance would be reduced (for example, CMS gives an example where a $100 Medicare allowed amount with a reduced coinsurance of 10 percent results in $10 owed by the beneficiary and $90 paid by Medicare, instead of the usual $20/$80 split).
CMS selects cohort; beneficiaries cannot appeal selection
CMS would select which beneficiaries are in the GLOBE Model cohort (based on a beneficiary's address of record in selected geographic areas) and selection would not be subject to appeal; beneficiaries must have traditional Medicare Part B FFS as their primary payer and must not be enrolled in Medicare Advantage, a section 1876 cost plan, or certain prepayment plans to be eligible for cohort inclusion. Providers and suppliers would continue to buy and bill for GLOBE Model drugs as usual, but providers must reduce beneficiary coinsurance when the GLOBE Model reduced coinsurance applies.
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Key Dates
Department and Agencies
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