Regulatory NewsBREAK: CMS Releases the GENEROUS Model (Generating Cost Reductions for U.S. Medicaid Model)

• On November 6, 2025, the Centers for Medicare & Medicaid Services (CMS) released the GENEROUS Model (Generating Cost Reductions for U.S. Medicaid Model). The model aims to achieve Most Favored Nation (MFN) international pricing for Covered Outpatient Drugs (CODs) while maintaining or improving the quality of care for Medicaid beneficiaries. 
• The Model proposes setting Medicaid net costs for specific CODs at MFN prices by requiring manufacturers to offer supplemental rebates to states, which could reduce drug costs and overall health expenses.  
  The model also seeks to standardize coverage criteria across states for participating manufacturers' CODs, reducing administrative burdens and enhancing beneficiary access. 
• Eligible manufacturers must join the Medicaid Drug Rebate Program (MDRP) and submit their applications by March 31, 2026. They are required to negotiate essential terms with CMS, provide MFN pricing for all their CODs, and enter into participation agreements by June 30, 2026. Participation excludes CODs covered under other CMS models, such as the Cell and Gene Therapy model. 
• States, the District of Columbia, and U.S. territories participating in the MDRP may join after key terms are negotiated and at least one manufacturer is a participant. States will apply through a separate RFA anticipated in December 2025, execute participation agreements with CMS, and enter supplemental rebate agreements with manufacturers by August 31, 2026.
• An independent contractor will perform a comprehensive evaluation of the model's implementation and its impact on Medicaid spending and quality of care. Participants must cooperate with data collection activities, including surveys and interviews, with aggregated results reported to ensure confidentiality.
• Supplemental rebates provided under the model are in addition to statutory Medicaid rebates and aim to achieve MFN pricing.  
• CMS retains rights to modify model policies annually and to terminate participation based on performance or compliance issues.
• Also on November 6, 2025, the Trump Administration announced deals with Novo and Lilly regarding GLP-1s on TrumpRx. 

More on This Topic:

• Request for Application
• Fact Sheet 
• GLP-1 Announcement

For questions, please reach out to Vicky Jucelin.