AHA urges HHS to finalize repayment remedy for 340B hospitals, not recoup funds as part of ‘budget neutrality adjustment’

The AHA filed its comment letter on the Department of Health and Human Services’ proposed remedy for the unlawful payment cuts to certain hospitals that participate in the 340B Drug Pricing Program following the Supreme Court’s unanimous decision in American Hospital Association v. Becerra. 

The AHA strongly supported HHS’ proposal to make a one-time lump-sum repayment to hospitals for the amounts they were underpaid from 2018 to 2022, as well the proposal to pay 340B hospitals what they would have received in beneficiary cost-sharing had the unlawful 340B payment policy not been in effect. It urged HHS to finalize these aspects of the proposal immediately.    

At the same time, the AHA pressed HHS not to finalize its proposal to recoup funds from hospitals as a “budget neutrality adjustment.” The AHA explained that HHS’ legal and public policy justifications for this proposed recoupment were groundless and, in reality, the agency has “both the legal obligation and legal flexibility to not seek a clawback of funds that hospitals received as a result of HHS’ own mistakes and have long since spent on patient care.” 

Specifically, the AHA stated HHS should not pursue any budget neutrality adjustment. If HHS does, AHA said the department should: 

•    drastically reduce the overall amount; 
•    delay any recoupment until 2026 or later; 
•    finalize the current aspect of the proposal that would spread the “adjustment” across 16 years; and 
•    recoup funds in a way that does not lead to a Medicare Advantage Organization windfall at the expense of hospitals and health systems.

Comments on the proposed rule are due Sept. 5.