AHA refiles lawsuit to reverse CMS cuts to 340B program

A trio of hospital groups, led by the American Hospital Association (AHA), refiled a lawsuit to reverse the Centers for Medicare and Medicaid’s (CMS) cuts to Medicare Part B reimbursements for drugs purchased through the 340B program.

  • About 40 percent of hospitals are eligible to participate in the 340B drug program, which requires drug manufacturers to provide outpatient drugs to providers at a 20-50 percent discount
  • As of Jan. 1, CMS cut payments for the program by $1.6 billion and claimed it would redistribute the savings by increasing Medicare payments to hospitals for other services
  • In November 2017, the AHA, the Association of American Medical Colleges (AAMC) and America’s Essential Hospitals sued CMS; the case was dismissed by a federal court as premature. This ruling was upheld in an appeals court in July
  • In their latest lawsuit, the groups—joined by three health systems—argue the court’s previous rulings no longer apply, as hospitals have now begun filing claims that have gone through the Medicare appeals process

We will provide any updates regarding this ongoing issue next month.

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