December 30, 2017—U.S. District Judge Rudolph Contreras yesterday dismissed on procedural grounds the lawsuit to block a 28.5 percent reduction in 340B hospitals’ Medicare Part B drug reimbursement. The case was dismissed on the basis that hospitals have not yet presented a specific claim for reimbursement that has received the reduced payment rate. The decision left open the possibility of renewed litigation to reverse the cut at some future date, as the court has not yet determined whether the Centers for Medicare & Medicaid Services (CMS) has the legal authority to reduce payments to 340B hospitals. The hospital groups that filed the suit said yesterday that they plan to continue to pursue the lawsuit.
For now, however, 340B hospitals paid under the Hospital Outpatient Prospective Payment System (OPPS) will have to comply with CMS’s Nov. 13 final rule implementing the Part B reimbursement cut. For services provided on or after Jan. 1, 340B hospitals paid under the OPPS must use modifiers to identify certain 340B-acquired drugs furnished to Medicare beneficiaries. 340B Health, which represents more than 1,300 hospitals and health systems in the 340B program, said yesterday it will keep working with Congress and others to reverse the cuts.