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CMS Launches Survey to Collect 340B Drug Acquisition Costs

The Centers for Medicare & Medicaid Services (CMS) released a survey to collect drug acquisition costs from hospitals participating in the 340B Drug Pricing Program.

The survey opened April 24 and requests acquisition cost data from all 340B hospitals, except critical access hospitals. CMS published the final survey instructions and the survey instrument; the agency is instructing hospitals to access the survey through a 340B survey gateway and submit to their Medicare Administrative Contractor by May 15.

CMS might use data collected through the survey to determine Medicare Part B drug reimbursement rates. CMS first proposed collecting 340B drug acquisition cost data in a notice of information collection issued in November 2019, stating it could use this data to set payment rates for Medicare Part B drugs under the Outpatient Prospective Payment System (OPPS). Since 2018, CMS has paid 340B hospitals at 77.5 percent of average sales price (ASP) for most Medicare Part B drugs, compared with the default rate of 106 percent of ASP it pays other hospitals. A federal district court judge held the policy to be in violation of the Medicare statute, and CMS since has appealed the case. CMS has stated that if it loses its appeal in the case, it might use acquisition cost data it collects from the survey to set payment rates for 340B drugs.

In the survey instructions, CMS provides hospitals two options: complete a detailed survey of acquisition costs, or defer to CMS to use ceiling price data published by the Health Resources and Services Administration as a proxy for the hospital’s acquisition costs. The data that hospitals submit under the detailed survey option include a list of average acquisition costs for all specified covered outpatient drugs purchased by the hospital at 340B prices in the fourth quarter of 2018 and the first quarter of 2019, listed by Healthcare Common Procedure Coding System code. The reported acquisition cost is to reflect the subceiling price after all applicable discounts.

America’s Essential Hospitals twice submitted comments on the proposed version of the survey, arguing it unlawfully collects data from one subset of OPPS hospitals — 340B hospitals. The association also asked CMS to withdraw this survey in light of the novel coronavirus pandemic.

Contact Senior Director of Policy Erin O’Malley at eomalley@essentialhospitals.org or 202.585.0127 with questions.

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About the Author

Shahid Zaman is a senior policy analyst at America's Essential Hospitals.

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