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340B Medicare Reimbursement Adjustments

Great news for 340B hospitals impacted by the reimbursement reductions initiated by the Center for Medicare and Medicaid Services (CMS) on January 1, 2018. Recently, CMS announced that the 2023 Medicare outpatient payment rates will be restored to rates prior to 2018 for affected hospitals.

After many legal debates, court filings, and outcry from hospitals and provider advocacy groups, the Supreme Court issued hospitals participating in the 340B Drug Pricing Program a convincing victory in June of this year. The top court ruled unanimously against an approximate 30% pay cut for outpatient drugs purchased at discount by 340B hospitals. Specifically, hospitals challenged the 2018 and 2019 payment rates for 340B hospitals because CMS lowered the rate for covered drugs from average sales price (ASP) plus 6% to ASP minus 22.5%.

Adjustments to 340B Medicare Reimbursement

The Supreme Court ruling influenced CMS to implement the previous rate of ASP + 6% which will be applied to separately payable drugs and biologics under the OPPS payment system for 2023. At the time of the Supreme Court ruling, it was unclear how CMS was going to handle the decision, but a September 28 court order encouraged CMS to act quickly. The court order instructed CMS to restore reimbursement immediately, rather than waiting until 2023.

CMS announced that Medicare Administrative Contractors (MACs) would automatically reprocess claims for 340B-acquired drugs paid under Part B for claims paid on or after September 28, 2022 but was vague about reprocessing of claims prior to September’s court order.

As of late October, many MACs issued policies regarding adjusting 340B claims in 2022. Based on these announcements by the MAC’s, we believe adjustments to claims dating back to January 2022 can be provided, but adjustments are not automatic. If you would like to learn more about the possibility or opportunity to have your claims adjusted to the higher rate of ASP + 6%, please reach out to one of our 340B ACE consultants listed below.

Contact Us

Blue will continue to monitor all of the information available and provide updates as necessary. We welcome the opportunity to address any questions or concerns and assist with evaluating how these changes to 340B reimbursement rates will impact your organization. If you have any questions about how 340B Medicare reimbursement adjustments could impact your organization, please reach out to your local Blue & Co. Advisor or a member of our 340B team.

Kyle Smith, CPA, 340B ACE, Director

Jason Prokopik, PharmD, 340B ACE, Senior Manager

Chad Downing, RPh, 340B ACE, Senior Consultant

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