The American Hospital Association (AHA) and Maine Hospital Association on Monday filed a lawsuit in U.S. District Court in Maine to stop upcoming changes to the federal 340B Drug Pricing Program, which provides lower-cost drugs to hospitals and clinics that serve rural, poor and vulnerable communities.
Four community-based health care providers that participate in the program -- St. Mary’s Regional Medical Center in Maine, the Unity Medical Center in North Dakota, the Dallas County Medical Center in Arkansas and the Nathan Littauer Hospital and Nursing Home in New York – joined in the lawsuit.
Under changes to the program planned by the U.S. Department of Health and Human Services, safety-net providers would have to pay drug manufacturers the full market price for drugs upfront and then seek reimbursement only after the drugs are administered to patients. This would impose hundreds of millions of dollars in additional annual costs and burdensome paperwork requirements on hospitals and other covered entities, with no benefit to patients, the plaintiffs said.
“When the government announced its new rebate program just a few months ago, it recognized that it would fundamentally shift how the 340B program has operated for more than three decades,” said Rick Pollack, president and CEO of the American Hospital Association. “When making such a major change, with such far-reaching consequences for patients and hospitals, it is important that the government follow the basic administrative rules of the road. Unfortunately, it did not do so here.”
The 340B Rebate Model Pilot Program, if implemented on January 1, would impose financial challenges on participating hospitals and providers. “And giving hospitals only a few months to comply with these burdensome new requirements or risk losing millions of dollars in discounts they are entitled to under the law will harm patients and communities across the country,” Pollack said. “We are asking the court to act quickly to protect access to vital care services.”
For more than 30 years, the 340B program has helped safety-net hospitals provide care to millions of people and communities in need, according to the plaintiffs. In 2022 alone, thanks in part to these savings, 340B hospitals provided nearly $100 billion of benefits to their communities, including free or discounted drugs for patients, comprehensive care for the uninsured, behavioral health services, opioid treatment, oncology care, food pantries and more.
“Maine’s hospitals are already facing very difficult financial conditions as they strive to continue providing a full range of care to their communities,” said Steven Michaud, president of the Maine Hospital Association. “Maine hospitals simply cannot afford the immense costs of this hastily imposed rebate program.”
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.