CMS Finalizes 340B Drug Payment Rates For 2023

According to a statement from the Centers for Medicare & Medicaid Services (CMS), payments for drugs that were given discounts under the 340B program will be reinstated, along with increases in Medicare’s outpatient payment rates for 2023.

The 2023 Medicare Hospital Outpatient Prospective Payment System (OPPS) final rule from CMS is the organization’s most recent effort to comply with a June Supreme Court decision that unanimously rejected a 30% cut in payments for outpatient drugs bought at a discount by 340B hospitals.

The news was lauded by hospitals, as they believe the resumed payments will help them continue to serve areas that most need their services.

“We are very pleased to see that CMS has restored equity to the Medicare [OPPS],” Maureen Testoni, president and CEO of 340B Health, an organization representing hospitals involved in the 340B program, stated. “For 30 years, 340B has supported hospitals in serving patients living with low incomes, and full Medicare payments for those services are essential for the healthcare safety net.”

The American Hospital Association (AHA), which had filed the lawsuit that ultimately resulted in the overturning of the cuts, also stated that the abolition of CMS’ policy will make it easier for 340B hospitals to offer crucial comprehensive health services to their patients and other stakeholders.

In 2018, CMS implemented a policy that paid over 20% below the average sales price for specific medications bought through the 340B program, although it typically paid hospitals the ASP plus 6% for covered outpatient drugs.

The Supreme Court has ordered CMS to compensate for all the years of slashed payments and instructed lower courts to come up with potential solutions. A U.S. district judge ordered CMS to cancel the rate reduction for the remainder of the 2022 calendar year in late September, but the courts have not yet established a repayment schedule.

In Tuesday’s final rule release, CMS made it clear that it intends to develop a remedy for future rule-setting that will arrive before it proposes next year’s OPPS rule. On the flip side, AHA doesn’t believe CMS requires more time to come up with a separate rule as it has already had plenty of time to make amends.

Additionally, CMS has also published its official Hospital Outpatient Prospective Payment System (HOPPS) and Medicare Physician Fee Schedule (MPFS) and rules for next year.

Radiology reimbursement reductions in the MPFS are anticipated to be less severe than originally predicted in the agency’s initial rule in July. The American College of Radiology (ACR) forecasts in its preliminary analysis that the 2023 MPFS alterations will lead to a 2% fall in radiology reimbursement. Moreover, payments for interventional radiology will fall by 3% and for nuclear medicine by 2%.

The ACR, however, claimed that the decline was partly brought on by modifications to RVUs along with the eventual switch to clinical labor pricing updates. It also said that if Congress fails to extend the 3% upturn given by the Protecting Medicare and American Farmers from Sequester Cuts Act, there will possibly be even greater percentage decreases in FY 2023.