The United States' public healthcare insurance system

Obama introduced the Affordable Care Act (ACA), which subsidizes healthcare for low-income individuals, requiring each state to shoulder part of the healthcare costs for its low-income residents and mandating—through taxation and penalties—that employers of all sizes provide health insurance coverage for their employees. The ACA includes the following provisions: ・ The Act established Health Insurance Marketplaces (also known as 'Exchanges') where individuals and small businesses can purchase health insurance. ・ Individuals who obtain health insurance through their employer but pay more than 9.5% of their income toward monthly premiums may qualify for premium subsidies under the ACA. ・ Individuals or families with incomes between 100% and 400% of the Federal Poverty Level (FPL) are eligible for government-subsidized health insurance assistance. ・ The ACA defines a set of Essential Health Benefits (EHBs), requiring all plans to cover certain core services—including physician visits, hospitalization, and prescription drug coverage. Health insurance plans are broadly categorized into three tiers: Bronze, Silver, and Gold. Each tier differs in terms of coverage terms and cost-sharing ratios; higher premiums correspond to lower out-of-pocket expenses, allowing enrollees to select the plan best suited to their personal circumstances. ・ The Act prohibits insurers participating in the Health Insurance Marketplaces from denying coverage or charging higher premiums based on pre-existing conditions, pregnancy, illness, or planned surgery. ・ The ACA introduced an individual mandate requiring most Americans aged 65 and under to maintain health insurance coverage—or face a financial penalty (though this penalty was reduced to $0 under the Trump administration). ・ Employers with 50 or more full-time employees must offer health insurance to their staff, or risk paying penalties. ・ Young adults may remain on their parents’ health insurance plans until age 26. ・ The 'Sunshine Act' In 2017, although ACA premiums rose an average of 22%, federal premium subsidies also increased—approximately 77% of enrollees paid less than $100 per month (after subsidy), and over 70% paid less than $75. While the ACA significantly expanded health insurance coverage in the U.S., it failed to address the persistently high cost of healthcare. [Coverage Gaps] As of 2025, ten states have opted not to expand Medicaid under the ACA: Alabama, Florida, Georgia, Kansas, Mississippi, South Carolina, Tennessee, Texas, Wisconsin, and Wyoming. The Sunshine Act To enhance transparency in healthcare, the ACA’s Sunshine Act requires pharmaceutical and medical device companies to publicly disclose annually all financial interactions with physicians and teaching hospitals. The U.S. Sunshine Act applies to products covered by three major government-funded insurance programs: Medicare, Medicaid, and SCHIP—including drugs, medical devices, and consumables.

Negative news for the 'top innovative drug company' is lifted

On August 31, BeiGene announced a voluntary Drug Rebate Agreement with the U.S. government, providing tislelizumab (Brukinsa) to eligible patients at an agreed-upon price through the Medicaid program. Upon the announcement, BeiGene’s A-share stock dipped slightly by 0.13%, while its H-shares were nearly flat—suggesting market indifference. Media commentary varied widely: some headlines claimed BeiGene had 'capitulated to the U.S. government', others alleged it had been 'singled out by Trump'. A closer look reveals BeiGene executed a shrewd maneuver: by adopting a posture of 'cooperative price adjustment', it secured several benefits far more valuable than the discount itself—effectively lifting the prior negative outlook regarding potential profit margin erosion on key products sold overseas. 01 What exactly does the agreement entail? The core of BeiGene’s agreement is to supply tislelizumab to qualifying low-income patients through Medicaid at a negotiated price. Many readers may be unfamiliar with what Medicaid actually is—so let’s clarify several easily confused concepts within the U.S. pharmaceutical pricing system. The U.S. government purchases medicines primarily through two distinct systems: First, Medicare—the federal health insurance program covering approximately 67 million people, including seniors aged 65+ and certain disabled individuals. Medicare is divided into Part B (covering drugs administered in hospitals or clinics—mainly intravenous biologics) and Part D (covering retail prescription drugs—primarily oral medications and self-injectable biologics). The 2022 Inflation Reduction Act (IRA) granted the federal government authority to directly negotiate drug prices with manufacturers for Medicare Part D drugs. Starting in 2026, the first 10 Part D drugs saw price reductions of 39%–79%; Part B drugs will enter negotiations beginning in 2028. Second, Medicaid—the federal-state partnership program covering roughly 90 million low-income individuals, pregnant women, and people with disabilities. Medicaid operates its own statutory drug rebate program: manufacturers wishing to have their products covered under Medicaid must sign a federal rebate agreement and provide rebates calculated using a statutorily mandated formula. Then came the GENEROUS program, launched by the Trump administration in January 2026—a voluntary, five-year initiative layered atop Medicaid’s existing rebate framework. It asks manufacturers to voluntarily offer additional supplemental rebates so that Medicaid’s net drug price aligns with the second-lowest price among eight reference countries: the UK, France, Germany, Japan, and others—i.e., a 'Most-Favored-Nation (MFN)' pricing mechanism. Participation is entirely voluntary. BeiGene’s agreement is precisely a supplemental Medicaid rebate agreement under the GENEROUS program. Notably, BeiGene did not undergo mandatory price negotiation under Medicare (which falls under the IRA)—but rather voluntarily signed a supplemental rebate agreement under Medicaid. These two mechanisms differ fundamentally in nature, target populations, and financial impact scale. The product BeiGene offered is tislelizumab (Brukinsa), not zanubrutinib. Tislelizumab generated global sales of RMB 2.984 billion in the first half of 2026—with Medicaid channel sales accounting for only a high-single-digit percentage.

Trump Announces All 50 States Joining Medicaid Drug Pricing Model

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President Trump announced all 50 states will join a Medicaid drug pricing model using Most Favored Nation principles to lower costs. While the administration claims billions in savings, experts question the lack of public deal details.

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Trump Announces All 50 States Joining Medicaid Drug Pricing Model

Trump Announces All 50 States Joining Medicaid Drug Pricing Model

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