News Briefs: California fines Anthem

The Supreme Court ruled that HHS incorrectly altered the 340B drug program, with Justice Brett Kavanaugh finding that “absent a survey of hospitals’ acquisition costs, HHS may not vary the reimbursement rates only for 340B hospitals; HHS’ 2018 and 2019 reimbursement rates for 340B hospitals were therefore unlawful.” Kavanaugh’s opinion found in favor of the American Hospital Association, which brought a suit against HHS over the changes. “When the original [changes] went into effect in 2018, CMS cut Medicare 340B reimbursements by ~30% for most outpatient drugs, leading to ~$1.6B in savings for the first year,” wrote Citi analyst Jason Cassorla in a note to investors. HHS may have to make retroactive payments to hospitals to make up for the savings, Cassorla noted.

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