Supreme Court Reinstates Medicare Drug Reimbursements To 340B Hospitals
Hospitals participating in the 340B program will be able to recoup billions in drug payments that Supreme Court justices unanimously decided were improperly cut. The Trump administration reduced the Medicare subsidies, and the Biden administration defended the policy.
AP:
High Court Rules Against Government On Drug Reimbursement
The Supreme Court said Wednesday that the federal government improperly lowered drug reimbursement payments to hospitals and clinics that serve low-income communities, a reduction that cost the facilities billions of dollars. The high court ruled unanimously in a case involving payments for drugs, largely for cancer, that are used by Medicare patients in hospital outpatient departments. The Biden administration had stood by a Trump administration decision to reduce the payments. (Gresko, 6/15)
The Wall Street Journal:
Hospitals May Recoup Billions Of Dollars In Drug Payments Under Supreme Court Ruling
The unanimous decision on Wednesday reverses two years of the cuts, which were made starting in 2018 as a centerpiece of the Trump administration’s health-policy agenda. The cuts sharply reduced federal subsidies under a program, known as 340B, created to help buoy hospitals that care for larger numbers of uninsured patients. The decision means 340B hospitals may be able to recoup billions of dollars in drug subsidies. The amount affected by the cuts totaled about $1.6 billion annually, and the sums were redistributed broadly among hospitals. (Evans and Mathews, 6/15)
Stat:
Supreme Court Sides With Hospitals On Medicare Drug Pay Dispute
The decision isn’t good news for all hospitals, however. The issue divides the industry, as payment changes are zero-sum. If the Trump administration’s 340B pay cuts are reversed, other hospitals could see pay cuts — particularly for-profit hospitals that aren’t eligible for the discounts. It’s unclear how the pay dispute will be resolved, as the reduced pay rates for 340B hospitals have been in effect for several years. The hospital groups that brought the suit called for backpay to make up for the cuts, but also asked that for-profit hospitals be held harmless. (Cohrs, 6/15)
Modern Healthcare:
Hospitals Win 340B Lawsuit At Supreme Court
The unanimous opinion, authored by Justice Brett Kavanaugh, reverses a 2020 decision by the U.S. Court of Appeals for the District of Columbia Circuit. "Absent a survey of hospitals' acquisition costs, HHS may not vary the reimbursement rates only for 340B hospitals; HHS's 2018 and 2019 reimbursement rates for 340B hospitals were therefore unlawful," Kavanaugh wrote. "Under the text and structure of the statute, this case is therefore straightforward." The high court also rejected HHS's contention that the regulations aren't subject to judicial review. (Goldman, 6/15)
Fierce Healthcare:
Supreme Court Overturns 340B Pay Cut To Hospitals
In the ruling (PDF), the justices noted that the Department of Health and Human Services did not survey hospital costs before adjusting payments for 340B in a 2018 rule, which cut payments to hospitals in the program by nearly 30%. The agency repeated that approach in 2019 rulemaking, and attorneys for HHS argued before the court that the surveys were not required. SCOTUS disagreed. (Minemyer, 6/15)
