On January 20, 2025, President Trump rescinded the Biden administration’s Executive Order 14087: Lower Prescription Drug Prices for Americans.
In 2022, the Inflation Reduction Act (IRA) gave Medicare the right – for the first time in its history – to negotiate with pharmaceutical companies over prices the federal government paid for drugs in Medicare Part D (the part of Medicare that provides insurance coverage for prescription drugs). This provision of the IRA was a huge step forward to lowering costs and easing stress on family budgets for working Americans, and it also helped lower government spending and reduce deficits.
EO 14087 directed the Department of Health and Human Services (HHS) to consider additional actions that could reduce prescription drug costs. In response to the EO, the HHS put forward several models of improved affordability and access to prescription drugs that policymakers could implement. It included proposals to institute a $2 co-payment for generic prescription drugs across Medicare Part D, and to help state governments in their own negotiations with drug companies over prices in Medicaid.
If the recommendations of the EO were advanced by the Trump administration rather than rescinded, further progress in reducing working families’ cost-of-living could have been made.