The U.S. Department of Health and Human Services is pulling the plug on a controversial rebate pilot in the 340B drug discount program. This program helps health care providers who serve low-income and uninsured patients purchase medications at reduced prices.
The discounted prices traditionally have been provided upfront. To receive discounts under the pilot program, however, hospitals would have been required to provide data to drug manufacturers after certain drugs were dispensed. The Trump administration said this would address drugmaker concerns about abuse and fraud as the number of 340B purchases increases.
However, the American Hospital Association and several leading hospitals countered that the proposed program would cost vulnerable safety-net hospitals hundreds of millions of dollars and reduce their ability to provide care. They filed a lawsuit in December, alleging that the administration was implementing changes without following the proper notice-and-comment rulemaking process.
Days before the pilot was set to take effect, a federal judge paused its implementation Although the administration appealed this decision, the First Circuit Court of Appeals upheld the lower court's ruling. It said the federal government had failed to convince the judges it would succeed on the merits of its case. As a result, HHS now has decided to end the program before it begins.
"The AHA appreciates HHS' decision to go back to the drawing board and rethink its rebate program," President and CEO Rick Pollack said in a statement. "We remain grateful to the district court and First Circuit for quickly recognizing the many legal flaws in the original program."
HHS also agreed to issue a new notice and solicit public comment if it proposes another 340B rebate program. Any effective date for a new pilot proposal would be at least 90 days after announcing manufacturer approvals.
"The AHA is eager to work with the administration on policies that make drugs more affordable and ensure access to care for American families," Pollack said. "A rebate program that undermines safety-net hospitals' ability to offer more comprehensive care would only harm the nation's most vulnerable communities."
© 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.