ExecutiveOrdersEO
EO 14087Executive OrderBiden · D

Executive Order 14087

Lowering Prescription Drug Costs for Americans

This executive order directs the Secretary of Health and Human Services to consider and select new health care payment and delivery models through the Center for Medicare and Medicaid Innovation that would lower prescription drug costs and promote access to innovative therapies for Medicare and Medicaid beneficiaries. The Secretary must report within 90 days on selected models and plans to test them, complementing the Inflation Reduction Act's drug pricing provisions.

Federal Register Open PDF 87 FR 63399

Impact dates

  1. HHS Secretary report due to Assistant to President for Domestic Policy on selected Innovation Center models and testing plan/timeline

Key directives

  • HHS Secretary shall consider whether to select new health care payment and delivery models for Innovation Center testing that lower drug costs and promote access to innovative drug therapies for Medicare and Medicaid beneficiaries
  • HHS Secretary shall submit report within 90 days to Assistant to President for Domestic Policy enumerating and describing any selected models, including plan and timeline to test them
  • Secretary shall take appropriate actions to test any models discussed in the report following submission

Who is ordered

Timeline

Immediate

  • EO signing and directive to HHS Secretary

Near term (90d)

  • HHS Secretary report due to Assistant to President for Domestic Policy on selected Innovation Center models and testing timeline

Long term

  • Potential testing of new payment and delivery models to lower drug costs and promote value-based care; implementation of IRA provisions including Medicare drug price negotiation and inflation rebates

Risks & tensions

  • Uses 'consider whether to select' and 'may lead to' — no mandatory model selection, creating implementation uncertainty
  • Dependent on 'subject to availability of appropriations' and 'consistent with applicable law'
  • Models must meet 42 U.S.C. 1315a(b)(2) criteria, adding statutory constraints
  • Complements but does not alter IRA provisions, which are the primary structural mechanism for drug price reduction
Executive Order 14087: Lowering Prescription Drug Costs for Americans · Executive Orders