The Centers for Medicare & Medicaid Services (CMS) has introduced a new initiative aimed at lowering prescription drug costs and improving access to critical medications for Medicaid beneficiaries. The GENErating cost Reductions fOr U.S. Medicaid (GENEROUS) Model, set to launch in 2026, will allow participating states to purchase certain drugs at internationally competitive prices to reduce spending and promote affordability.
The model encourages state Medicaid programs and drug manufacturers to collaborate on transparent, uniform pricing and coverage standards, ensuring patients receive consistent access to essential medications. Medicaid drug spending exceeded $100 billion in 2024, highlighting the need for reform and sustainability.
CMS has released a Request for Applications (RFA) for drug manufacturers and will invite state Medicaid agencies to submit letters of intent to participate. Approved states will be eligible to implement the negotiated pricing and model terms beginning in 2026.
Resource: GENEROUS (GENErating cost Reductions fOr U.S. Medicaid) Model