Medicare Launches GLOBE Model to Tame Drug Price Hikes
Published Date: 10/2/2026
Rule
Summary
Starting November 30, 2026, Medicare will use the new GLOBE Model to help lower the cost of certain drugs for people on Original Medicare. This model changes how drug price increases are calculated, aiming to save money for both patients and the Medicare program without cutting care quality. If you’re on Medicare Part B, expect smarter drug pricing that helps keep your healthcare affordable.
Analyzed Economic Effects
5 provisions identified: 4 benefits, 1 costs, 0 mixed.
Selected Medicare beneficiaries pay less coinsurance
About 25 percent of Original Medicare (OM) Part B beneficiaries in randomly selected ZIP Code Tabulation Areas (ZCTAs) will be placed in the GLOBE Model cohort and may pay reduced coinsurance for certain Part B drugs. The model begins collecting data January 1, 2027, performance years run April 1, 2027 through March 31, 2032, and beneficiary coinsurance is computed using the lesser of the GLOBE benchmark amount or the inflation-adjusted payment amount (the rule gives an example where coinsurance could be reduced from 20% to 10%).
Medicare program expects multi-year cost savings
CMS estimates the GLOBE Model will reduce Medicare Part B net spending by $440 million over the 7-year payment period (April 1, 2027 through March 31, 2034), including $298 million in Original Medicare Part B benefit savings, $288 million in Medicare Advantage payment savings, and a $147 million premium offset impact; the rule also estimates $39 million in Medicaid savings over the period.
GLOBE applies only to specific high‑spend Part B drugs
The model will apply to a subset of Part B rebatable single-source drugs and sole-source biological products within specified USP categories (Antigout Agents, Antineoplastics, Blood Products and Modifiers, Central Nervous System Agents, Immunological Agents, Metabolic Bone Disease Agents, and Ophthalmic Agents). To be included, a drug must have OM Part B spending greater than $100 million over a 12-month period ending 6 months before the start of the applicable calendar quarter; the rule also lists explicit exclusions (for example, drugs subject to Medicare Drug Price Negotiation, drugs designated for rare diseases under 21 U.S.C. 360bb, FDA-listed cellular and gene therapy products, and plasma-derived products).
Manufacturers must pay GLOBE rebates; data collection starts January 2027
Manufacturers of Part B rebatable drugs that are GLOBE Model drugs are mandatory model participants and will be required to pay incremental GLOBE Model rebates when the benchmarked amount exceeds the statutory inflation-adjusted payment amount. CMS will begin collecting voluntary manufacturer-submitted international drug net pricing data on January 1, 2027, and the model uses two benchmark methods (Method I using commercial international price sources and Method II using manufacturer-submitted net prices). The set of reference countries includes Australia, Canada, France, Germany, Japan, the United Kingdom, and others listed in the rule.
Providers must reduce beneficiary coinsurance and will receive adjusted payments
Providers and suppliers who furnish GLOBE Model drugs to GLOBE Model beneficiaries will continue to bill and be paid under Medicare Part B, but when reduced beneficiary coinsurance applies the provider must lower the coinsurance charged and Medicare’s program payment to the provider will be adjusted upward accordingly (the rule gives an example where a $100 allowed amount with coinsurance reduced from 20% to 10% yields a Medicare payment of $90 and beneficiary responsibility of $10). Providers are not model participants and beneficiary selection and rebate determinations are not subject to appeal.
Personalized for You
How does this regulation affect your finances?
Personalize government policy and PRIA will tell you what this federal register document means for your household, plus every other regulation we track. PRIA reads each provision against your financial profile to show you exactly what matters to your wallet.
Key Dates
Department and Agencies
Related Federal Register Documents
2026-20131, Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2027 and Updates to the IRF Quality Reporting Program; Correction
This correction fixes some technical mistakes in the Medicare payment rules for inpatient rehab facilities starting October 1, 2026. It mainly affects hospitals and rehab centers by clarifying how wage data and payments are calculated, ensuring fairer payment rates for fiscal year 2027. No big changes in money, but it keeps everything accurate and on track.
2026-19959, Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities; Updates to the Quality Reporting Program for Federal Fiscal Year 2027; Correction
This correction fixes some technical mistakes in Medicare payment rules for skilled nursing facilities starting October 1, 2026. It mainly affects how hospital data is used to calculate payments, making sure no current hospitals are wrongly excluded. These tweaks help keep Medicare payments fair and accurate for providers and patients.
2026-20067, Medicare Program; FY 2027 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Program Requirements; Correction
This correction fixes some technical mistakes in the FY 2027 hospice payment and wage index rules that were first published in August 2026. It mainly affects hospice providers by updating how their payments are calculated, making sure the numbers are accurate starting October 1, 2026. These changes help ensure hospices get the right payment amounts based on the latest hospital wage data.
2026-19946, Medicare Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals (IPPS) and the Long-Term Care Hospital Prospective Payment System and Policy Changes and Fiscal Year (FY) 2027 Rates; Requirements for Quality Programs; Other Policy Changes; and Adoption of Updated Versions of Certain Health Information Technology Standards; Correction
This update fixes some typos and technical mistakes in the Medicare payment rules for hospitals starting October 1, 2026. It affects hospitals getting paid for patient care, making sure the payment system and quality programs run smoothly. These corrections help hospitals get the right payments and follow updated health tech standards without delays or confusion.
2026-15652, Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2027 and Updates to the IRF Quality Reporting Program
This final rule updates the prospective payment rates for inpatient rehabilitation facilities (IRFs) for Federal fiscal year (FY) 2027. As required by statute, this final rule includes the classification and weighting factors for the IRF prospective payment system's (PPS) case-mix groups and a description of the methodologies and data used in computing the prospective payment rates for FY 2027. It also finalizes the third and final of the 3-year phaseout of the rural adjustment, which began in FY 2025. This final rule includes a solicitation for public comments on alternative data sources for the IRF PPS wage index; requires all therapy treatments and/or therapy evaluations to begin no later than 36 hours from midnight on the day of admission; finalizes requirements for the initial Interdisciplinary Team meeting to occur on or before 4 days from the date the patient is admitted; and summarizes a request for information on potential future IRF PPS payment reform. Additionally, this final rule includes updates to the IRF Quality Reporting Program and changes to the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program.
2026-15686, Medicare Program; FY 2027 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Program Requirements
This final rule updates the hospice wage index, payment rates, and aggregate cap amount for fiscal year 2027. This final rule also includes an analysis of Medicare non-hospice spending, including details regarding a hospice service and spending variation index, and finalizes the requirement that hospices provide the hospice election statement addendum to all Medicare beneficiaries at the time of hospice election. Additionally, this rule finalizes conforming changes to discharge from hospice care regulations and changes to the face-to-face encounter regulations. This final rule also includes a summary of comments received on our requests for information regarding community- based palliative care; the construction of a hospice specific wage index; and the overlap between hospice and medical aid in dying laws. Finally, this rule finalizes changes to the Hospice Quality Reporting Program.
Previous / Next Documents
Previous: 2026-20276, State of Indiana: Discontinuance of Certain Commission Regulatory Authority Within the State, Notice of Agreement Between the Nuclear Regulatory Commission and the State of Indiana
Starting September 30, 2026, Indiana will take over certain nuclear material safety rules from the U.S. Nuclear Regulatory Commission. This means the state now handles the rules for some radioactive materials that aren’t enough to cause a nuclear reaction. This change helps Indiana manage its own safety standards without extra federal oversight.
Next: 2026-20285, Sunshine Act Meetings
The Unified Carrier Registration (UCR) Task Force is holding a public meeting on October 7, 2026, to keep improving the UCR Plan and Agreement. They’ll discuss important topics like conflict of interest forms and subcommittee rules to make sure everything runs smoothly. This affects carriers who register under the UCR system and aims to keep the process fair and transparent without extra costs right now.