Judge allows 340B drug payment cuts for 2018 to proceed pending a final ruling

On December 29, 2017, a ruling by a US District Court Judge denied a preliminary injunction to the cuts to Medicare Part B reimbursement rates for 340B drugs pending a final legal decision in a suit filed by a group of about 30 affected hospitals and related associations. The plaintiffs initially filed suit on November 13, with an initial hearing held on December 21 in which the plaintiffs advocated for a preliminary injunction of the rule. In denying of the preliminary injunction, the rate cuts took effect on January 1, 2018.

The suit stems from a provision in the Medicare Outpatient Prospective Payment System (OPPS) final rule issued on November 1, 2017. In the final rule, the Centers for Medicare and Medicaid Service (CMS) announced that it would no longer reimburse certain 340B-purchased drugs at the standard Part B rate of Average Sales Price (ASP) plus 6 percent, instead paying a rate of ASP minus 22.5 percent.

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CMS finalizes changes to payment policy under the 340B drug discount program

The Centers for Medicare and Medicaid Services (CMS) on November 1, 2017, released the 2018 Hospital Outpatient Prospective Payment System (OPPS) final rule, moving forward with a significant change in payment policy under the 340B drug discount program that was included in the proposed rule earlier released in July.

Beginning January 1, 2018, CMS will no longer reimburse most 340B-purchased drugs at the standard Part B rate of Average Sales Price (ASP) plus 6 percent, and instead will pay a rate of ASP minus 22.5 percent. The change in payment policy has drawn sharp criticism from hospital organizations, including litigation by the American Hospital Association, the Association of American Medical Colleges, America’s Essential Hospitals and member hospitals to block the change in payment policy.

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CMS releases rules to implement site-neutral Medicare payments for certain provider-based departments starting January 1, 2017

The Centers for Medicare and Medicaid Services (CMS) on Tuesday, November 1, 2016, moved forward with the adoption of a site-neutral Medicare payment policy for non-excepted (non-grandfathered) items and services provided at certain off-campus provider-based departments (PBDs). CMS provided the guidance as part of the final rule on the Medicare Hospital Outpatient Prospective Payment System (OPPS).

The final rule is scheduled to be published in the Federal Register on November 14, 2016.

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