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CMS says it is making computer file changes to restore hospitals’ Part B payments for 340B-purchased drugs to average sales price plus 6% for the rest of 2022 after paying them almost 30% less since 2018.

CMS Says Steps to End Medicare Drug Payment Cut for 340B Hospitals Are in Progress

The U.S. Centers for Medicare & Medicaid Services is making computer file changes to restore hospitals’ Part B payments for 340B-purchased drugs to average sales price plus 6% for the rest of 2022 after paying them almost 30% less since 2018, CMS said last week.

CMS notified hospitals of the change in a newsletter Oct. 13.

“CMS is uploading revised OPPS drug files that will apply the default rate (generally ASP plus 6%) to 340B-acquired drugs for the rest of the year,” the agency said. “CMS also will reprocess claims our contractors paid on or after September 28, 2022, using the default rate (generally ASP plus 6%).”

The U.S. Supreme Court ruled unanimously in June that the Trump administration illegally cut Part B reimbursement for 340B drugs under the hospital Outpatient Prospective Payment System to ASP minus 22.5% starting in 2018. The case involved cuts for 2018 and 2019 only. The federal government has conceded in court since then that the cuts in 2020, 2021, and this year are illegal too.

On Sept. 28, a federal district judge ordered CMS to begin paying 340B hospitals immediately at the higher rate for the rest of this year.

340B hospital pharmacy officials and third-party administrators said this morning there is confusion about whether Medicare administrative contractors (MACs) will adjust hospitals’ payments automatically, or upon request, for 2022 claims.

“I don’t think the MACs are organized to roll it out uniformly,” a health system official said. “We now have three MACs all issuing different messages and [one] not even addressing the claims prior to Sept. 28.”

“All communication I have heard before this week was that payments would be automatic,” Visante Senior Vice President Kristen Fox-Smith said. “Several MACs are saying they are going to automatically reprocess all claims with 2022 dates of service, but that hospitals can submit adjustments if they do not want to wait for the mass adjustments to go through. There is one MAC indicating that hospitals may need to resubmit claims processed prior to Sept. 28 to receive full reimbursement.”

CMS is due to release its OPPS final rule for 2023 in about two weeks. It said in July in its OPPS proposed rule it fully expects to pay ASP plus 6% for hospitals’ 340B drugs next year. CMS solicited comments “on the best way to craft any potential remedies affecting cost years 2018-2022.” It is expected to say in the final rule how it will fix those cuts.

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