President Donald Trump signed an executive order on May 12 aimed at reducing the cost of some medications.
The order directs drugmakers to sell medicines in the U.S. at prices similar to those offered in other wealthy countries, or face penalties and enforcement actions.
The move tasks HHS Secretary Robert F. Kennedy Jr. with setting target prices to bring U.S. drug costs “in line with comparably developed nations,” known as a “most favored nation” model. If drugmakers do not make progress toward those targets, the order directs federal agencies to explore ways to implement most favored nation pricing. Learn more about the order here.
Five more updates:
1. House Republicans introduced a 160-page bill May 11 that would implement Medicaid work requirements nationwide and impose stricter eligibility requirements for the program. The bill aims to reduce federal spending by hundreds of billions of dollars over the next decade, with most of the proposed cuts affecting Medicaid and ACA programs. The bill could cut Medicaid and ACA spending by up to $715 billion over the next decade and result in at least 8.6 million people losing insurance coverage by 2034, according to an analysis from the Congressional Budget Office.
2. A federal judge in California has halted the White House’s mass layoffs of federal employees for at least two weeks, court documents show. Judge Susan Ullston of the U.S. District Court for the Northern District of California granted a temporary restraining order blocking the terminations May 9. The action is part of a federal lawsuit filed by the American Federation of Government Employees, along with several other labor unions, nonprofit organizations and local governments last month. The plaintiffs argue that the executive branch cannot implement such sweeping changes to federal agencies and workforces without Congressional approval.
Judge Ullston’s ruling pauses the layoffs as the case plays out.
“Federal courts should not micromanage the vast federal workforce, but courts must sometimes act to preserve the proper checks and balances between the three branches of government,” she wrote in the order.
HHS defended the legality of its restructuring plan in a May 12 statement to Becker’s.
“Every step taken has been deliberate, collaborative and consistent with federal personnel policy and civil service protections. To suggest otherwise is inaccurate and misrepresents the integrity and facts of the process,” a spokesperson said.
3. The U.S. and China have agreed to a pause most tariffs enacted in the past month for the next 90 days, according to a May 12 joint statement. U.S. tariffs on Chinese imports will be reduced from 145% to 30%, and China’s tariffs on U.S. imports will be lowered from 125% to 10%, NBC News reported May 12.
Sweeping tariffs have raised concerns across the healthcare industry, as hospital leaders prepare for supply chain disruptions and cost increases. In a January survey of 200 healthcare industry experts, 82% said they expect tariff-related import expenses to increase costs by 15% through the first half of the year.
4. HHS will pause enforcement of some mental health parity regulations for employers and health plans. In a May 9 court filing, attorneys for HHS said the administration intends to reconsider mental health parity regulations finalized by the Biden administration in September 2024. The agency will not enforce the current regulations until it reaches a final decision.
5. President Trump signed an executive order May 9 to improve care and benefits for veterans. The order instructs the Secretary of Veterans Affairs to create a new center for unhoused veterans in Los Angeles that will offer substance use disorder treatment, among other services. The order also directs the VA to reduce wait times at facilities nationwide by extending hours and offering weekend appointments and virtual care. In addition, the agency will explore the feasibility of turning Manchester (N.H.) VA Medical Center into a full-service medical center. At present, New Hampshire is the only state without such a facility, according to a May 9 statement from VA Secretary Doug Collins.
