“BLATANTLY ILLEGAL”!  MASSIVE DECISION BY THE SUPREME COURT CONDEMNS JOE BIDEN FOR VIOLATING THE DRUG REIMBURSEMENT RULES

The Supreme Court issued a resounding decision in favor of hospitals’ claims for 340B drug reimbursement on Wednesday, but it left providers wondering how they will be compensated for the two years during which they did not receive billions from the Department of Health and Human Services, as well as what will happen going forward.

According to the publication, the ruling gives low-income patient-serving hospitals a victory and enables them to apply for the funding that Becerra’s office had previously barred them from receiving.

“There is the unanswered concern as to the remedy, the question of how hospitals will be made whole as a result of payment cutbacks,” said Jeff Davis, a partner at Bass, Berry & Sims who represents hospitals.

The justices agreed unanimously to overturn a 2020 circuit court decision that favored the hospitals. Justice Brett Kavanaugh, who wrote the ruling for the Supreme Court, stated that the case was remanded for “further proceedings consistent with our opinion.”

According to the federal Medicare legislation, as Kavanaugh summarized in his judgment, HHS is required to pay hospitals for some outpatient prescription medications that the hospitals provide to Medicare patients. Each year, these payments amount to tens of billions of dollars. HHS has two options for how to determine payments. If it first conducts a study of the price hospitals pay to buy the prescription pharmaceuticals, it may adjust reimbursement rates for various groups of hospitals. In the alternative, if the agency has not conducted such a study, it must establish reimbursement rates based on the typical sales price manufacturers charge for the pharmaceuticals and is not permitted to modify the reimbursement rates for various types of hospitals, according to the outlet.

“This is a huge success for 340B hospitals that were adversely affected by the reimbursement reduction in 2018-2019; some entities may stand to recover millions,” said Ryan Bailey, vice president at Advis, in a statement. It remains to be seen how this choice will affect CMS policy going forward in 2020. There will probably be follow-on effects, such as higher 340B drug reimbursement, more detailed acquisition cost studies, or a thorough reorganization of the drug payment system. This ruling also suggests that the SCOTUS may adopt a rigorous approach to interpreting agency regulation authority outside of only 340B.

SCOTUS hands Biden a defeat.https://t.co/Q4VIbeGtvA

— Dinesh D'Souza (@DineshDSouza) June 21, 2022

THE DECISION: The court found that HHS inappropriately relied on a formula that Congress made available only under particular conditions and that did not apply in this case. The Medicare Prescription Drug, Improvement, and Modernization Act was enacted in 2003 by President George W. Bush. According to The Epoch Times, “The act mandates HHS to annually establish payment rates for specific outpatient prescription medications given by hospitals using a specified formula.

The #SupremeCourt unanimously ruled that @HHSGov illegally reduced prescription drug reimbursements to hospitals by $1.6 billion per year in a program aimed at helping poor patients. https://t.co/LgJEvbRbOV

— The Epoch Times (@EpochTimes) June 20, 2022

After the circuit court ruled against the hospitals in August 2020, numerous pharmaceutical companies ceased offering 340B hospitals discounted drug rates.

Davis estimates that 17 pharmaceutical companies have so far implemented stringent 340B pricing through contractual pharmacy agreements. According to him, other people have stated that they would offer the reductions if the hospitals disclosed their claims data.

The Public Health Service Act mandates that drug companies that accept Medicaid sell their products to 340B hospitals at a substantial discount.