CMS Targets $5.7 Billion in 340B Drug Cuts, Expands Site-Neutral Imaging Pay for 2027
Updated
Updated · Healthcare Dive · Jul 2
CMS Targets $5.7 Billion in 340B Drug Cuts, Expands Site-Neutral Imaging Pay for 2027
3 articles · Updated · Healthcare Dive · Jul 2
Summary
Medicare proposed reimbursing 340B hospitals at average sales price minus 33.4%, a cut CMS says would lower 2027 drug spending by $5.7 billion and beneficiary costs by $1.15 billion.
CMS said a new acquisition-cost survey showed large gaps between what 340B hospitals pay for drugs and what Medicare reimburses, after the Supreme Court voided a 2017 payment cut for lacking that study.
The same 2027 outpatient rule would equalize payments for imaging without contrast across off-campus hospital departments and physician offices, trimming Part B spending by about $260 million in the first year.
Hospitals and safety-net advocates said the proposal would strip critical funding from 340B providers, while budget-neutrality would shift equivalent non-drug outpatient dollars toward non-340B providers.
Beyond payment cuts, CMS proposed a 2.4% outpatient rate increase, prior authorization for eight more botulinum toxin codes, broader EMTALA oversight by accreditors, and a new push on hospital price transparency.
As Medicare equalizes imaging payments, could this threaten the services offered at your local hospital?
Will paying hospitals and clinics the same price for scans finally slow down healthcare consolidation?
With Medicare leading the way, are big cuts to private health insurance premiums coming next?
The Trump Administration’s $170 Billion Medicare Payment Cuts: Site-Neutral Policies, 340B Reform, and Stakeholder Impacts
Overview
The Trump administration is proposing major Medicare payment cuts to address inefficiencies and high costs in the healthcare system. By expanding site-neutral payment policies and reforming the 340B drug discount program, the plan aims to equalize reimbursement rates for medical services, regardless of whether care is provided in a hospital outpatient department or a physician’s office. This change targets the current system where hospitals receive higher payments for the same services, which encourages consolidation and raises Medicare costs. The reforms are designed to protect beneficiaries from higher premiums and cost-sharing, while also reducing unnecessary spending across the system.