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Earlier this month we wrote about how certain changes proposed by the Centers for Medicare and Medicaid Services (CMS) would impact safety net hospitals like Asante’s Rogue Regional Medical Center and Three Rivers Medical Center.
The specific impacts of these changes would be as follows:
- Changes to 340B Reimbursement Model – $38.5 million annual loss, with approximately 95 percent of the impact concentrated within cancer services.
- 340B Offset Remedy – $6 million per year
The total impact of these losses are estimated to be $44.5 million per year, which equates to 3% of margin. In a fiscal year that we are hoping to break even, these changes on their own force Asante into the red.
This Week we submitted formal comment to CMS recommending the following:
- Withdraw the proposal to reimburse 340B-acquired drugs at ASP minus 33.4 percent.
- Maintain the current reimbursement methodology for 340B-acquired drugs.
- Conduct comprehensive rural access analyses before implementing any payment reduction.
- Conduct specific oncology access analyses assessing impacts on cancer care delivery and patient outcomes.
- Evaluate and publish the effects of the proposed budget-neutral redistribution.
- Reconsider the proposal to accelerate the 340B remedy offset from 0.5 percent to 3 percent annually.
A copy of our public comment can be found here.
In our public comment, we emphasized that the proposed changes move the 340B program away from what Congress intended, redistributing funds from safety net hospitals to those who need this critical funding less.
Congress created the 340B program to strengthen the nation’s healthcare safety net and allow providers to stretch scarce resources in service of vulnerable patients. The CY 2027 OPPS proposal moves in the opposite direction. It does not lower drug prices, does not require pharmaceutical manufacturers to contribute to savings, and does not meaningfully reduce overall Medicare spending. Instead, it shifts resources away from hospitals that care for rural, low-income and medically underserved populations.
The significant changes to the 340B program will negatively impact our hospitals, community and cancer centers if CMS does not reverse course. We will continue advocating to preserve this program to protect the vulnerable and underserved populations that we serve.
