- A CMS advisory panel on Monday recommended against finalizing the agency’s proposed rule slashing 340B drug payments, Modern Healthcare reported.
- Hospitals have lobbied extensively against the proposal, which would pay hospitals 22.5% less than the average sales price for drugs acquired through the program, instead of the current rate of 6% more than the average sales price.
- At a regular meeting Monday, the Advisory Panel for Outpatient Hospital Payments recommended more research on the proposal’s effects and a more concrete plan for how the savings would be used.
By law, the panel includes 15 members who are provider representatives so the hesitancy to approve of the payment cuts isn’t unexpected. MedStar executives testifying to the panel on behalf of the American Hospital Association (AHA) echoed earlier arguments about the benefits of the 340B program, which applies to hospitals serving a high proportion of people with low incomes.
MedStar uses 340B savings to help fund free clinics and transportation subsidies for the homeless and other underserved populations, according to AHA. Safety net hospitals have said the proposed cuts could disrupt care and cause hospitals to further stretch already scarce resources.
The CMS has estimated the cuts to 340B payments would save about $900 million next year, but hasn't settled on a way to spend the savings. It could be used to increase overall hospital Medicare payments or be put in the Medicare trust fund.
Hospitals say the culprit in high drug prices is pharmaceutical companies. Much of the public agrees, as do lawmakers. There are a few legislative ideas for curbing drug costs, but nothing has gained traction in Congress, which has been busy discussing potential repeal of the Affordable Care Act.