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When to Expect Your 340B Drug Remedy Payment

Published on 

Wednesday, January 10, 2024

During the first week of 2024, the following information was posted on several of the Medicare Administrative Contractors (MACs) websites.

“On June 15, 2022, the Supreme Court held in American Hospital Association v. Becerra that because CMS had not conducted a survey of hospitals’ acquisition costs, it could not vary the payment rates for outpatient prescription drugs by hospital group. On remand, the U.S. District Court for the District of Columbia prospectively vacated-beginning September 28, 2022- adjustments CMS had made to payments under the Hospital Outpatient Prospective Payment System for drugs acquired through the 340B program.

On January 10, 2023, the U.S. District Court for the District of Columbia issued a remand without vacatur to give the Centers for Medicare & Medicaid Services (CMS) the opportunity to determine the proper remedy for the reduced payment amounts to 340B hospitals under the payment rates in the final OPPS rules beginning in CY 2018 and continuing through September 27, 2022.

Accordingly, on November 8, 2023, CMS published the Hospital Outpatient Prospective Payment System: Remedy for the 340B-Acquired Drug Payment Policy for Calendar Years 2018-2022.

Under this final rule, affected hospitals will be paid a one-time lump-sum amount based on the difference between what they were paid for 340B-acquired rugs from CY 2018 through September 27, 2022, and what they would have been paid during this time-period had the 340B Drug Payment Policy never existed. These payment amounts are listed in Addendum AAA to the final rule. This final rule ensures affected hospitals will receive the approximate payment they would have received if the original CY 2018-2022 340B payment policy had never existed.

Beginning January 8, 2024, Medicare Administrative Contractors (MACs) will begin making these one-time lump-sum remedy payments to affected providers via HIGLAS. There payments are scheduled to be completed by February 7, 2024.

The MACs will not included these lump sum payments on any cost report.

All remedy payments are subject to the MAC’s normal accounting procedures and may in effect be combined with other payment released on the same date and/or include any applicable outstanding Medicare offsets that are the result of provider-specific overpayment obligations, adjustments resulting from errors identified through the lump-sum technical correction process, any of which may impact the provider’s net payment amount.”

MAC Specific Announcements

Palmetto GBA Jurisdiction J

Palmetto GBA Jurisdiction M

NGS Jurisdiction 6

NGS Jurisdiction K

CGS Jurisdiction 15

WPS Jurisdictions 5 & 8

Article Author: Beth Cobb, RN, BSN, ACM, CCDS
Beth Cobb, RN, BSN, ACM, CCDS, is the Manager of Clinical Analytics at Medical Management Plus, Inc. Beth has over twenty-five years of experience in healthcare including eleven years in Case Management at a large multi-facility health system. In her current position, Beth is a principle writer for MMP’s Wednesday@One weekly e-newsletter, an active member of our HIPAA Compliance Committee, MMP’s Education Department Program Director and co-developer of MMP’s proprietary Compliance Protection Assessment Tool.

This material was compiled to share information.  MMP, Inc. is not offering legal advice. Every reasonable effort has been taken to ensure the information is accurate and useful.