Regulatory updates that could be considered “We are pleased that the Department of Health and Human Services continues moving forward to enforce the 340B statute as it demands that six drug companies stop denying required discounts to safety-net hospitals,” Testoni also said in a statement. The advocacy group 340B Health this week applauded the withdrawal of the advisory opinion, with President and CEO Maureen Testoni calling it an “unnecessary distraction created by drug company efforts to challenge the government's authority to enforce the law.” One of the manufacturers, Eli Lilly, again went to court in May to request an injunction on any civil monetary penalties that HRSA may impose as detailed in the letters. But the Health Resources and Services Administration (HRSA), the HHS sub-agency that administers 340B, is standing by letters it sent to six drug manufacturers in which it stated that restrictions on discounts to contract pharmacies “resulted in overcharges and are in direct violation of the 340B statute.” So, it could be quite some time before this is finally resolved.”Ī new twist in the cases came June 18 when HHS withdrew the advisory opinion in an effort to render the litigation moot. We can probably assume that whichever side loses in any of the courts is going to appeal. “Not only do we not know what any one of those courts is going to end up deciding, we don’t know if they’ll all decide the same thing. “I think the big question on everyone’s mind is: Where is that all going to end up?” Pfister said. That opinion stated that contract pharmacies of 340B-covered entities should be eligible for discounts through the program. Three separate cases are pending in which drug manufacturers filed suit in response to an HHS advisory opinion from December 2020. What’s still at issue in the courtsįollowing the Supreme Court ruling, the federal court system may yet have a significant impact on the 340B program. Because 340B eligibility is tied to DSH adjustment percentage, a reduction to the pool of Medicaid patients could have affected hospitals that are "right on the cusp of being eligible,” Pfister said. “So it’s a big sigh of relief.”Īmong 340B-eligible hospitals more broadly, another issue with overturning the ACA would have stemmed from a theoretical end to the expansion of Medicaid. “If the act had been overturned, then their eligibility would no longer exist and absent congressional action, they wouldn’t be able to participate in 340B anymore,” Pfister said. The ACA subsequently provided eligibility to all critical access hospitals and to hospitals in the following groups that meet a specific DSH adjustment percentage threshold: The 340B program was established by statute in 1992, requiring drug manufacturers participating in Medicare Part B or Medicaid to offer discounts to many Disproportionate Share Hospitals (DSH). Eligibility for many 340B participants was on the line In a recent interview, Helen Pfister, JD, a partner with Manatt Health and an expert on 340B issues, discussed the implications of the ruling and where the much-scrutinized program goes from here.
In ruling that plaintiffs seeking to overturn the ACA lacked standing to bring the case, the court ensured a continuation of the 340B eligibility expansion that was established by the 2010 healthcare reform law. The 340B Drug Pricing Program generated few headlines in the context of the Supreme Court’s recent decision on the Affordable Care Act, but plenty was at stake for the program. The 340B program also may be in store for regulatory updates.Federal courts could have a more direct impact on the program by resolving the question of whether contract pharmacies should be eligible for 340B discounts.An under-the-radar aspect of the Supreme Court’s recent ruling on the Affordable Care Act involved hospital eligibility for the 340B program, an industry expert says.