A three-judge panel of the D.C. Circuit May 4 heard arguments in the case challenging Medicare payment cuts to many hospitals in the 340B Drug Pricing Program. The 340B program has enabled eligible hospitals to purchase certain outpatient drugs at discounted prices, with savings used to provide a range of health services, such as clinical pharmacy services, community outreach and transportation, and free vaccines, to their local communities.
The AAMC joined the American Hospital Association and America’s Essential Hospitals, and three hospitals, in a lawsuit to prevent the nearly 30 percent Medicare payment reduction from taking effect on Jan. 1, 2018. The complaint alleged that the Department of Health and Human Services (HHS) acted beyond its statutory authority and in violation of the Administrative Procedure Act. Late in December 2017, a district court judge dismissed the case on jurisdictional grounds [see Washington Highlights, Jan. 5].
During Friday’s argument, the appellate judges focused primarily on jurisdictional questions as well as whether judicial review is precluded under the Medicare statute for this type of agency action. A decision is expected in several months.
A recording of the oral arguments is available here.