A collection of hospital groups has re-filed a lawsuit against the Trump administration over its cuts to a drug discount program.
The case was filed in the U.S. District Court of the District of Columbia by the American Hospital Association, the Association of American Medical Colleges, and America’s Essential Hospitals, as well as three hospitals.
The hospitals say that the cuts violate the law, saying they are outside of the authority of the Department of Health and Human Services, which authorized the cuts.
A similar lawsuit was struck down by the same court in July, after a judge ruled that it was filed prematurely because the $1.6 billion-a-year in cuts had not gone into effect. The cuts were supposed to go into effect in January of this year, and the lawsuit was filed last year. At the time, hospitals vowed to re-file suit.
The program, known as 340B, requires drugmakers to provide discounts to eligible hospitals, including teaching hospitals, children’s hospitals, facilities that provide charity care, and those that serve rural areas. The cuts will occur through Medicare, the government coverage program for adults 65 and older and people with disabilities. They amount to a 30 percent reduction in what Medicare typically pays hospitals for the program.
“We look forward to receiving a prompt resolution on the merits of our case,” the hospital associations said in a joint statement. “For over 25 years, 340B program drug discounts have played a critical role in helping hospitals expand access to care for vulnerable patients and communities at no cost to the federal government.”
Federal data shows that about 40 percent of all hospitals participate in the drug discount program. It has been the subject of congressional scrutiny, with drug companies and some lawmakers charging that hospitals are misusing the discounts to pad their bottom lines rather than reinvest them to improve patient care.
[Also read: Senate unanimously passes bill banning pharmacy ‘gag clauses’ in Medicare]
