publication date: Nov. 10, 2017

CMS plan to slash $1.6 billion from 340B program will reduce discounts on cancer drugs

By Matthew Bin Han Ong

Hospitals enrolled in the 340B program stand to lose up to $1.6 billion in Medicare Part B reimbursements through upcoming cuts to the drug pricing program, according to a final rule by the Centers for Medicare and Medicaid Services.

Published Nov. 1, the final Outpatient Prospective Payment System regulation would move $1.6 billion out of the drug discount program, cutting reimbursement to 340B hospitals for separately payable drugs by nearly  30 percent.

Part B payments would drop from the current level of average sales price plus 6 percent to ASP minus 22.5 percent.

“CMS is implementing this policy in a budget neutral manner by offsetting the projected decrease in drug payments of $1.6 billion by redistributing an equal amount for non-drug items and services across the OPPS,” according to a fact sheet published by CMS. “CMS may revisit these policies for [calendar year] 2019 and is especially interested in exploring policies addressing the needs of safety net hospitals, which play a critical role in serving the most vulnerable populations.”

The OPPS, which was put in place in 2000, pays for designated hospital outpatient services and some Medicare Part … Continue reading CMS plan to slash $1.6 billion from 340B program will reduce discounts on cancer drugs

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