HHS Sued Over Delay in Drug Discount Rule

Congress in 2010 passed legislation requiring transparency in drug pricing for a hospital program known as 340B, and the Obama administration issued a final rule (finally) in January 2017. Now, the Trump administration is delaying implementation at the cost of a lawsuit against the Department of Health and Human Services (HHS).

hhs-sued-over-delay-in340B-rule-implementationThe American Hospital Association (AHA) and America’s Essential Hospitals have joined five other 340B stakeholders in taking legal action to force the rule’s implementation. Their lawsuit, filed yesterday (Sept. 11) in a federal court in Washington, D.C., seeks to make the 2017 regulation effective within 30 days.

The 340B program, created in 1992 and expanded under the Affordable Care Act (ACA), requires drug manufacturers to provide outpatient drugs to eligible providers at discounts of 20 to 50 percent. The savings are then to be used to treat low-income patients, provide transportation services and offer free vaccinations.

“As prescription drug prices continue to skyrocket, the 340B program is as crucial as ever in helping hospitals and health systems provide access to healthcare services for vulnerable patients and communities,” said Rick Pollack, president and CEO of the AHA.

Critics, however, have contended that some 340B providers are gaming the system by prescribing costlier drugs and pocketing the difference.

NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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