Archive · 8 Jan 2026
Court Blocks Trump Drug Rebate Scheme
A court stopped a plan by the Trump administration that would have made hospitals pay full price for certain medicines upfront and wait for rebates later.
The plan was meant to avoid giving hospitals double discounts, but the court said it would hurt hospitals that help poor people.
The court also said the plan didn't consider how it would affect hospitals, which could have cost them a lot of money.
The first 10 medicines affected include drugs for blood thinning and diabetes.
The American Hospital Association sued to stop the plan, and a lower court agreed, issuing an injunction to block it.
The Trump administration asked the appeals court to put the injunction on hold, but the court said no.
A US appeals court blocked the Trump administration’s drug rebate plan that would have forced safety-net hospitals to pay full prices upfront for Medicare-negotiated medicines.
The ruling halts an effort to alter how hospitals access discounted drugs under Medicare negotiations, protecting rural and underserved communities.
The court found that the Health Resources and Services Administration’s program disrupted a decades-long practice of providing upfront discounts to safety-net hospitals.
The American Hospital Association welcomed the ruling, stating the program would have a devastating effect on vulnerable patients and communities.
The first 10 drugs to be subject to negotiations include Eliquis, Xarelto, and Januvia, which were already subject to the federal 340B Drug Pricing Program.
- Who
- 1st U.S. Circuit Court of Appeals, American Hospital Association, Trump administration, safety-net hospitals
- What
- Blocking of Trump administration's drug rebate scheme
- When
- Ruling issued on Wednesday (specific date not mentioned)
- Where
- United States, with the court case originating in Maine
- Why
- To prevent disruption of a long-standing system designed to protect rural and underserved communities from rising prescription costs
- Court
- 1st U.S. Circuit Court of Appeals
- Program
- HRSA 340B Rebate Model Pilot Program
- Impacted Hospitals
- Safety-net hospitals serving low-income communities
- Drugs Affected
- First 10 Medicare-negotiated drugs, including Eliquis, Xarelto, and Januvia
- Legislation
- Inflation Reduction Act (2022)
- Rebate Model
- Drug companies charge wholesale prices upfront and issue rebates later
- Judge's Ruling
- Injunction blocking the program's implementation