Industry Watch Alert
CMS is testing whether international reference pricing can be operationalized within Medicare Part B without degrading access or quality. If finalized, the GLOBE Model would become one of the most consequential mandatory drug pricing demonstrations implemented to date.
Organizations supporting Part B drug administration, utilization management, or compliance oversight may want to begin internal assessments of how international benchmarking, modified rebate calculations, and regional applicability could affect financial modeling, operational workflows, and regulatory exposure.
Executive Summary
Centers for Medicare & Medicaid Services has proposed a new mandatory Medicare Part B drug payment demonstration known as the Global Benchmark for Efficient Drug Pricing (GLOBE) Model.
The proposal would link Medicare Part B drug inflation rebates to international pricing benchmarks drawn from economically comparable countries.
CMS states the model is intended to reduce Medicare Part B drug spending while preserving or enhancing beneficiary quality of care.
The GLOBE Model would apply to approximately 25 percent of Medicare beneficiaries in defined geographic regions.
If finalized, the model would run from October 1, 2026 through September 30, 2031, with rebate reconciliation continuing through September 30, 2033.
The Impact
The proposed GLOBE Model represents a material shift in Medicare Part B drug payment policy. Unlike prior voluntary demonstrations, GLOBE would be mandatory for selected drugs and providers within designated regions, signaling a more assertive federal approach to drug cost containment.
Key implications for payers, utilization management organizations, and compliance leaders include:
Rebate calculation and oversight complexity
The model would alter the Part B inflation rebate formula by incorporating international drug pricing benchmarks. This introduces new data dependencies, audit considerations, and reconciliation requirements that may affect delegated entities and downstream vendors.Operational and provider alignment considerations
Changes in reimbursement dynamics for physician-administered drugs could influence site-of-care decisions, contracting strategies, and provider behavior, particularly in oncology, infusion, and specialty care settings.Biosimilar policy signaling
GLOBE would exclude biosimilars and their reference biologics once a biosimilar enters the U.S. market, reinforcing federal reliance on biosimilar competition as a primary cost-control mechanism rather than international benchmarking.Geographic variability risk
Because the model applies only to defined regions, national payers and UM organizations may need to manage parallel reimbursement and compliance frameworks across markets.
CMS leadership has framed the proposal as a response to sustained growth in Medicare Part B drug spending and the long-standing disparity between U.S. drug prices and those paid in peer nations.
Sources
CMS Innovation Center;
Global Benchmark for Efficient Drug Pricing (GLOBE) Model
Federal Register;
Proposed Rule: Global Benchmark for Efficient Drug Pricing Model (Docket No. 2025-23702)
FAQ
- What is the CMS GLOBE Model?
The GLOBE Model is a proposed mandatory Medicare Part B drug payment demonstration that would modify inflation rebate calculations using international drug pricing benchmarks from economically comparable countries. - When would the GLOBE Model begin?
If finalized, the model would begin on October 1, 2026 and run through September 30, 2031, with rebate invoicing and reconciliation continuing through September 30, 2033. - Which drugs would be included in the GLOBE Model?
The model would apply to certain separately payable Medicare Part B drugs typically administered in physician or outpatient settings. Biosimilars and their reference biologics would be excluded once biosimilar competition exists in the U.S. market. - Who would be affected by the GLOBE Model?
Approximately 25 percent of Medicare beneficiaries residing in designated geographic areas would be included, along with the providers and organizations responsible for administering and managing covered Part B drugs in those regions. - How does the GLOBE Model differ from prior drug payment models?
Unlike many prior CMS demonstrations, the GLOBE Model would be mandatory within selected regions and would explicitly reference international drug pricing rather than relying solely on domestic inflation measures.
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