Industry Insights

CMS Finalizes Medicare Part B Drug Payment Cut for 340B Hospitals

November 2017
Authors:  Brenda Christman

Brenda Christman

Managing Director

Consulting

Health Care

Telecommuting

 & Brian Bell

Brian Bell

Director

Consulting

Health Care

Telecommuting

On November 1, 2017, the Centers for Medicare & Medicaid Services (CMS) published the final Outpatient Prospective Payment System (OPPS) (42 CFR Parts 414, 416 and 419). This reduces Medicare Part B drug reimbursement to hospitals participating in the 340B Drug Pricing Program (340B Program) for separately payable drugs from average sales price (ASP)-plus 6 percent to ASP-minus 22.5 percent. This reduction won’t affect drugs not purchased at 340B Program pricing, allowing these drugs to continue to be reimbursed at the current ASP-plus-6-percent rate. This reduction will be effective January 1, 2018.

The final OPPS rule won’t apply to rural sole community hospitals, children’s hospitals and PPS-exempt cancer hospitals. However, it will apply to urban sole community hospitals. For rural sole community hospitals, the exclusion from this rule only is applicable for calendar year (CY) 2018. CMS plans on revisiting the decision in the CY 2019 OPPS rule. The final rule also won’t affect critical access hospitals.

Hospitals need to review how the final OPPS rule affects their reimbursement and participation in the 340B Program. 340B Program hospitals that continue participating should put renewed effort into ensuring they’re fully participating while maintaining compliance.

On a separate but important note for participating 340B Program hospitals, the Health Resources and Services Administration has shared the following information regarding a new revised required registration time frame through the 340B Office of Pharmacy Affairs Information System (OPAIS):

Due to technical difficulties experienced during hospital recertification, and to ensure the accuracy and integrity of hospital data, we will begin a new recertification process for all hospitals beginning 11/3/2017 and ending 12/6/2017. You will be receiving an email tomorrow that will officially open the recertification process and provide the extended timeframes to complete the process. ALL hospitals will have to complete recertification under the new timeframes, regardless of whether you have already completed recertification, or if you were in the process of completing recertification. We apologize for the inconvenience, however data integrity is our top priority. As a reminder, authorizing officials and primary contacts must set up accounts to complete recertification. If you have questions setting up accounts or completing the recertification process please use the user guides found under the help section of the 340B OPAIS or contact the 340B Prime Vendor Program at 1-888-340-2787 or at apexusanswers@340pvp.com.

For more information on these matters, contact your trusted BKD advisor today.

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