All 50 states, the District of Columbia and Puerto Rico have applied to participate in a new Medicaid drug-pricing initiative that could reduce state spending on hundreds of brand-name medications, including asthma drugs. Although the program has the potential to improve access, CMS has not yet published a list of participating drugs or announced the coverage requirements that will apply to them.
The five-year GENEROUS—or GENErating cost Reductions fOr U.S. Medicaid — Model allows participating drug manufacturers to provide supplemental rebates that reduce Medicaid’s net cost for selected medications to prices comparable to those paid in certain other developed countries. Forty states and Puerto Rico have already signed participation agreements; the remaining states had until Sept. 30, 2026, to finalize their participation. CMS estimates that the model could save federal and state taxpayers $64.3 billion over 10 years.
Which drugs are included?
The White House says the model encompasses “hundreds” of medications across most major drug classes, specifically including asthma treatments. However, neither CMS nor the White House has released a drug-by-drug list.
CMS states that the model may include single-source and innovator multiple-source covered outpatient drugs from participating manufacturers. Importantly, each state will decide which drugs it wishes to include. A state may decline the GENEROUS price for a particular drug if an existing rebate agreement produces a lower net price or if another medication remains more economical. Therefore, manufacturer participation does not guarantee that every product in that manufacturer’s portfolio will be selected by every state.
The administration has announced agreements with 26 manufacturers representing approximately 89% of the branded pharmaceutical market:
Pfizer, AstraZeneca, EMD Serono, Eli Lilly, Novo Nordisk, Amgen, Bristol Myers Squibb, Boehringer Ingelheim, Genentech, Gilead Sciences, GSK, Merck, Novartis, Sanofi, Johnson & Johnson, AbbVie, Regeneron, Alcon, Astellas Pharma, BeOne Medicines, BridgeBio, CSL, Kyowa Kirin, Sun Pharma, Teva Pharmaceuticals and UCB. These companies manufacture and distribute numerous drugs for asthma, atopic dermatitis, immunoglobulin replacement and hereditary angioedema.
Product participation may also depend on the Medicaid rebate agreement, the product’s status as a covered outpatient drug, final CMS-manufacturer terms and each state’s individual selection.
What could this mean for patients?
The most important potential benefit may be improved access, rather than a direct reduction in patients’ copayments. Medicaid beneficiaries generally already have limited cost sharing, and the GENEROUS rebates will be paid to state Medicaid programs after claims are processed. Patients should not expect an immediate price reduction at the pharmacy counter solely because their state participates.
However, participating manufacturers and CMS will negotiate standardized coverage criteria. States adopting a manufacturer’s GENEROUS terms will be expected to align their coverage policies—including Medicaid managed care policies—with those criteria. If those requirements are less restrictive than existing state policies, patients could face fewer differences among Medicaid programs and potentially gain broader or more predictable access to medications. CMS has not yet disclosed whether the standardized criteria will change prior authorization, step-therapy or preferred-drug requirements for specific asthma, allergy or immunology treatments.
What should allergists know?
For now, the program does not change prescribing, coding or billing requirements. Physicians and their practices are not participants in GENEROUS. CMS also states that the supplemental rebates will not alter Medicaid Best Price or 340B ceiling prices.
Questions also remain about physician-administered biologics. Although qualifying covered outpatient drugs may fall within the model, CMS has not released enough product-level information to determine whether GENEROUS will alter Medicaid coverage or reimbursement for specific buy-and-bill medications. Lower state acquisition costs through rebates do not, by themselves, establish higher physician payment or eliminate prior authorization.
The College will continue monitoring:
- The final list of participating manufacturers and medications.
- State-by-state drug selections.
- Standardized coverage and prior-authorization criteria.
- Treatment of physician-administered biologics and Medicaid managed care plans.
- Whether savings produce meaningful improvements in patient access.
The GENEROUS Model is potentially significant for Medicaid patients with asthma, atopic dermatitis, chronic urticaria, hereditary angioedema and other allergic or immunologic conditions. However, until CMS publishes the medication list and coverage terms, its practical effect on individual patients and allergy practices remains uncertain. We will continue to monitor this issue and provide updates as they unfold.
The Advocacy Council – ADVOCATING FOR ALLERGISTS AND THEIR PATIENTS.
