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Judge orders HHS to remedy payment cuts to 340B drug discount program — 4 insights

A judge ruled HHS' cuts to the 340B drug discount program were unlawful and called for the department to remedy them.

What you should know:

1. U.S. District Judge Rudolph Contreras filed a ruling May 6 in response to the lawsuit brought by the American Hospital Association, America's Essential Hospitals and the Association of American Medical Colleges regarding HHS' reimbursement cuts to the 340B program.

2. HHS adjusted the reimbursement rate from a drug's average price plus 6 percent to 22.5 percent less than a drug's average price.

3. The court said the cuts were unlawful, but refused to order HHS to vacate the 2018 and 2019 rules for the sake of stability.

4. Instead, the court ordered HHS to remedy the rules, calling for HHS to submit a remedy plan by Aug. 5.

The three organizations issued the following joint statement: "America's 340B hospitals are pleased with the District Court's decision and urge HHS to follow the judge's directive to promptly resolve the harm caused by its unlawful cuts to Medicare reimbursement for certain 340B hospitals."

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