Skip to main content

One-year estimated state impact to hospitals of 340B cuts for FFY 2021

The 340B Drug Pricing Program allows qualifying hospitals to offer affordable prescription drugs to financially vulnerable and fragile patients by purchasing outpatient drugs from manufacturers at a discounted rate. These hospitals then can reinvest the savings in their services.

In 2018, CMS issued a final Outpatient Prospective Payment System rule that reduced by approximately 25% the reimbursement for certain drugs that hospitals acquired through the 340B Program and then continued those cuts in 2019 through 2022. HHS' 340B cuts are currently being challenged through a lawsuit with the U.S. Supreme Court. 

This analysis includes the continued 3.19% budget-neutral adjustment and the 340B reduction (Average Sales Price minus 22.5%) that was identified in the Standard Analytic File with the “JG” modifier, resulting in a net impact. DataGen has analyzed the budget neutrality adjustment and 340B cuts utilizing the 2019 Standard Analytic File showing the potential impact to 340B hospitals.


DataGen reviews and analyzes major Medicare policy changes before and after they happen, creating easy-to-understand analyses to help our state hospital associations, their members and multi-state health systems advocate, adjust and strategize accordingly.

Comments

Popular posts from this blog

Alternative payment models: Strategies for success

In this edition of DataGen Insights, we look at how alternative payment model participants can ensure their processes and workflows are optimally set up for success. To help, DataGen listed the top three strategies all providers participating in APMs can employ and created a handy checklist to enable maximum returns and reduce financial risk. Please explore our website to learn more about our  products and services .  Download DataGen Insights today .  We hope you enjoy!

Why it's critical for Primary Care First participants to control and understand leakage

Patients' primary care visits outside of their attributed primary care office, also called “leaked” patient visits, can have unintended consequences for Primary Care First participants. Beginning July 2022, PCF Cohort 1 will face a reduction in population-based payments based on their leakage rate. The payment adjustment will be based on their 2021 claims data and will roll forward quarterly. To calculate your leakage rate, divide the number of qualifying visits and services your attributed beneficiaries have made to care centers outside of your practice (for example, visits to urgent care centers) by the total number of qualifying visits and services your attributed beneficiaries have made. Calculating primary care leakage with claims data alone comes with some unintended challenges. Unfortunately, some circumstances can unfairly and negatively impact a practice’s leakage rate: Nuances classifying care delivered by provider team members: It’s difficult to distinguish

Start the year off right: DataGen answers your Primary Care First questions

The Primary Care First Model , an alternative payment model offering an innovative payment structure for the delivery of advanced primary care, welcomed the involvement of Cohort 2 participants on Jan. 1 . This cohort, which was open to all primary care practices that met the eligibility criteria, will participate from 2022 to 2026. Participants in PCF Cohorts 1 and 2 can expect the following benefits: an opportunity to increase revenue with performance-based payments that reward participants for reducing acute hospital utilization; the ability to assess and improve performance through actionable, timely data; less administrative burden so providers can spend more time focusing on patient needs; and potential to become a Qualifying APM Participant , which includes eligibility for a 5% incentive payment and eliminates Merit-based Incentive Payment System reporting requirements. To ensure that new and prior participants succeed in this model, DataGen has compiled and answered some of t