September 20, 2026 09:00 AM PST
(PenniesToSave.com) – President Trump used an Oval Office event on September 18 to announce that Medicaid programs in all 50 states, along with Washington, D.C., and Puerto Rico, will receive most favored nation pricing on prescription drugs [4][5]. The move extends to state Medicaid programs the same pricing standard the administration has spent the past year negotiating with pharmaceutical manufacturers [1].
The figures involved are large enough to matter to every taxpayer, not only to the people enrolled. Medicaid covers 66 million Americans, and the program’s net spending on prescription drugs grew 46 percent between 2019 and 2024, reaching $46 billion in that year alone, according to the nonpartisan health policy research group KFF [2]. In most states, Medicaid is the single largest item in the budget after education [2]. Money saved there is money that does not have to come from state taxpayers.
There is a genuine accomplishment in this announcement, and there is also a genuine gap. Federal price data shows prescription drug costs recording their steepest annual decline in more than 60 years, the largest drop since 1963 [1]. At the same time, the agreements with 26 drug manufacturers that produced those results have not been made public, and neither have the lists of which medications state Medicaid programs will actually get at a discount [2][4]. Both of those facts belong in any honest accounting of what households and taxpayers are getting.
Quick Links
- What Did the Administration Announce on September 18?
- How Much Money Is on the Table, and Who Keeps It?
- Why Have the Agreement Terms Stayed Private?
- Which Medications Are Covered, and Which Might Not Be?
- What Changes for States and the People They Cover?
- What Does This Mean for What You Pay at the Pharmacy?
What Did the Administration Announce on September 18?
The program is called GENEROUS, and it is run through the innovation center at the Centers for Medicare and Medicaid Services under Deputy Administrator Abe Sutton [3][4]. Participating drug companies will pay rebates to state Medicaid programs on brand name drugs, structured so that the final price after rebates does not exceed the most favored nation price, according to the White House fact sheet [4].
That mechanism deserves a moment of attention, because it determines who feels the benefit. A rebate is a payment that flows back to the state agency after the fact. It lowers what the taxpayer-funded program spends. It is not the same thing as a lower number printed on a pharmacy shelf tag.
The pricing benchmark itself is indexed to eight other high income nations, among them Canada, Germany, Japan, and the United Kingdom [5]. The administration has described the standard more broadly as matching the lowest price paid by comparable developed nations [1].
Getting here took a year. The first pact, with Pfizer, was announced on September 30, 2025, followed by deals with another 16 manufacturers after the administration sent letters seeking price concessions in lieu of tariffs [4]. On August 31, 2026, nine more companies signed voluntary agreements, including Alcon, Astellas Pharma, BeOne Medicines, BridgeBio, CSL, Kyowa Kirin, Sun Pharma, Teva Pharmaceuticals, and UCB, bringing the total to 26 [4]. Health and Human Services Secretary Robert F. Kennedy Jr., CMS Administrator Mehmet Oz, and the governors of Arkansas, Mississippi, and South Dakota joined the September 18 announcement [3][5].
A rebate paid to a state agency is not the same thing as a lower price at the counter.
How Much Money Is on the Table, and Who Keeps It?
The headline savings figure for Medicaid comes from the White House Council of Economic Advisers, which estimates $64 billion over ten years [3][5]. A White House research page puts the number at nearly $65 billion over the next decade [1][4]. Sutton described the annual figure as $5.2 billion in savings each year [3]. Readers who do the arithmetic will notice that $5.2 billion across ten years arrives at $52 billion rather than $64 billion, and none of the available material explains the difference.
The broader initiative carries the same problem. The White House has estimated savings of $529 billion over a decade [5], while its own September release points to a projection of more than $600 billion [1]. Those are both administration-sourced numbers, published weeks apart, separated by roughly $71 billion.
The underlying pressure on states is not in dispute. Oz said the roughly $50 billion states pay for pharmaceuticals after rebates is crowding out schools, roads, long term care, and rural care [3][5]. We are rescuing state budgets with this program
, he said [5]. Mississippi Governor Tate Reeves offered the sharpest illustration, noting that his state spends almost $700 million a year in state and federal dollars on Medicaid prescriptions against a general fund of roughly $7 billion [3].
That is a legitimate win on its own terms. State budgets operate under the same constraint as a well built household budget, where every dollar committed to one obligation is a dollar unavailable for another. The distinction worth holding onto is that these savings land first with state governments and taxpayers, not with individual enrollees.
Why Have the Agreement Terms Stayed Private?
The White House said 26 companies signed agreements, but those agreements have not been made public [2]. USA Today reported the same, noting that the administration has not released the terms of the voluntary pacts and did not immediately release details on which drugs are included or what the final prices will be after rebates are applied [4].
The reporting goes further. NPR contacted Pfizer and 16 other major manufacturers that reached pricing deals with the administration over the past year. None would confirm that all of their drugs would be discounted in Medicaid, and none would say exactly which ones would be [2]. Two companies told NPR the terms of their Medicaid agreements were confidential [2]. CMS, the federal regulator running the program, would not tell NPR how many of each company’s drugs would receive Medicaid discounts either [2].
Confidentiality clauses are ordinary in commercial contracts, and the manufacturers entered these arrangements voluntarily. The administration also points to published federal price data as the verifiable result, arguing that the outcome speaks for itself [1].
Still, taxpayers are funding the program that receives these discounts. When the policy case is this strong, disclosure costs the administration very little and gives the public something it can check independently. Accountability of that kind is not a partisan demand. It is the ordinary expectation attached to public money.
Two savings figures from the same administration, published weeks apart, differ by roughly seventy one billion dollars.
Which Medications Are Covered, and Which Might Not Be?
According to the White House fact sheet, the Medicaid discounts will involve hundreds of drugs across virtually all major drug classes, including medications that treat cancer, diabetes, and asthma [4]. What individual manufacturers told reporters was narrower. Gilead said it is working with states to make selected covered products available, including treatments for hepatitis C, hepatitis B, and HIV [2]. Sanofi pointed to certain wholly owned medicines for diabetes, cardiovascular and neurological conditions, and cancer [2]. Eli Lilly said it did not have a final list but expected many of its medicines to participate, while excluding its GLP-1 drugs tied to a separate Medicare pilot [2]. Genentech said only that certain medicines would be included [2].
Dr. Thomas Hwang of Brigham and Women’s Hospital in Boston told NPR this pattern creates room for gaming, because companies have incentive to select products where Medicaid already receives strong discounts and where international prices are not much lower [2]. In that scenario, a manufacturer could receive public credit for a discount that changes little in practice.
The coverage claims are also stated three different ways. The administration has described 26 companies as covering 90 percent of the branded U.S. market [1], as representing 90 percent of all drugs [3], and as accounting for nearly 90 percent of brand name drugs [4]. Against that, federal price data showing the steepest annual drug price decline since 1963, with prices falling every month of 2026, is a published and independently checkable measure [1]. Officials also announced a donation of one million doses of the blood thinner Eliquis to Medicaid programs [3].
What Changes for States and the People They Cover?
GENEROUS is structured as a voluntary pilot, which means each state decides whether to opt in and then accepts certain conditions [2]. The most consequential condition is that a state agrees to set aside its own coverage criteria and adopt a standardized system in order to receive the negotiated price [2].
Those criteria are the everyday tools state Medicaid programs use to manage costs. Prior authorization requires a doctor to request approval before a high cost drug is covered. Step therapy requires a patient to try a less expensive option first [2]. Ameet Sarpatwari, a professor of population medicine at Harvard, told NPR that states which previously limited access could be required to offer broader access, which might raise total state spending even at lower prices per dose [2].
Jack Rollins of the National Association of Medicaid Directors described the structural constraint that states have to balance their budgets every year, so a drug that saves money over a decade can still break a single year budget [2]. Deadlines for companies and states were originally set for the spring and summer and were pushed back. It’s always a bad sign when you keep pushing back your deadline
, Sarpatwari said [2].
Participation counts differ depending on the source. The White House says all 50 states, the District of Columbia, and Puerto Rico are in [1][3][4][5]. NPR reported on September 17 that all 50 states had applied by the September 10 deadline, and that according to CMS, 40 of them plus Puerto Rico had signed binding agreements, with states having until September 30 to finalize [2]. California officials told NPR they applied in part to see more details before committing [2].
What Does This Mean for What You Pay at the Pharmacy?
For most households, the honest answer is that this particular program does not change your price. GENEROUS moves money between manufacturers and state Medicaid agencies. If you carry employer coverage, a marketplace plan, or Medicare, your copay is set by your plan, not by this pilot.
The administration reports that its direct to consumer site, TrumpRx, has delivered more than $700 million in savings across more than 1,000 branded and generic medicines, with GLP-1 drugs that once cost over $1,000 a month starting as low as $149, eligible Medicare seniors paying $50 a month, and more than 500,000 seniors saving $216 million [1]. Two independent accounts add important context. The site directs cash paying consumers to manufacturer websites or to coupons usable at pharmacies, and it does not process insurance claims [4]. NPR reported that the available drugs are limited and that most consumers will do better using their insurance and paying the copay [2].
That points to a small habit worth adopting. Before filling a brand name prescription, ask the pharmacist for the cash price and compare it against your copay, because on specific drugs the cash price occasionally wins. It belongs on the same list as other practical ways to cut back on recurring expenses. If you or a family member is covered by Medicaid, watch your state’s prior authorization and step therapy rules over the coming months, since that is where the practical effect will appear first [2].
Longer term, the 26 manufacturers also committed roughly $170 billion to U.S. manufacturing and research, along with stocking the Strategic Active Pharmaceutical Ingredients Reserve, which the administration frames as reducing dependence on foreign supply chains for essential medicines [1].
Final Thoughts
Two things are true at the same time. Federal price data confirms the largest annual decline in prescription drug prices in more than 60 years [1], and the contracts that would let taxpayers audit the savings claims remain unpublished [2][4]. Acknowledging the first does not require ignoring the second.
For households, the most useful framing is this. Relief for state budgets is real and worth crediting, and it is a different thing from a lower price at the pharmacy counter. Mistaking one for the other leads to disappointment when the receipt looks the same as it did last month.
There is a date worth marking. Binding state agreements are due September 30, and the drug lists that follow will tell the real story about how much of this reaches patients [2]. Until those lists and the underlying agreements are public, the savings estimates remain estimates.
In the meantime, prescription costs remain one of the most common sources of household financial strain, and families carrying balances from past care may find it useful to review how to prioritize paying off medical and other debt while these policy changes work their way through the system.
Works Cited
[1] “President Trump Extends Most Favored Nation Drug Pricing to Every Medicaid Program in America.” The White House, 18 Sept. 2026, www.whitehouse.gov/releases/2026/09/president-trump-extends-most-favored-nation-pricing-to-every-medicaid-program-in-america/.
[2] Lupkin, Sydney. “A Year Ago, President Trump Pledged to Lower Medicaid Drug Prices. Has That Happened?” NPR, 17 Sept. 2026, www.npr.org/2026/09/17/nx-s1-5971066/trump-rx-medicaid-generous-drug-prices-pfizer-favored-nation.
[3] “President Trump Announces Medicaid Drug Price Discounts.” C-SPAN, 18 Sept. 2026, www.c-span.org/program/white-house-event/president-trump-announces-medicaid-drug-price-discounts/685416.
[4] Alltucker, Ken. “Trump: Medicaid Drug Pricing Deals Reached for All 50 States.” USA Today, 18 Sept. 2026, www.usatoday.com/story/money/personal-finance/healthcare/2026/09/18/trump-announced-medicaid-drug-pricing-deals-for-50-states/91829280007/.
[5] Nelson, Steven. “Trump’s ‘Favored Nations’ Drug Discount Gets Buy-in from All 50 States and Will Save Billions for Medicaid.” New York Post, 18 Sept. 2026, nypost.com/2026/09/18/us-news/all-50-states-opt-into-trumps-favored-nations-drug-pricing-for-medicaid/.