In response to recent developments, The American Hospital Association and WSHA are providing updated guidance to hospitals that are appealing the reductions to payments for 340B drugs under the 2018 Medicare outpatient rule. AHA and WSHA previously instructed affected hospitals to request redetermination for each claim where the 340B drugs were paid at the reduced rate in order to protect their right to full payment should litigation be successful. We recently learned that some Medicare administrative contractors (MACs), including Noridian, are notifying hospitals that they do not have appeal rights for these cases and that the appeals will be dismissed.
If a hospital decides to rely on the MAC notices and not file separate individual claim appeals, we recommend that the hospital send a letter to its MAC stating that in light of the MAC’s notice, the hospital will not continue separately to appeal each denial of full reimbursement for 340B claims, but that declining separately to appeal each denial will not prejudice the hospital’s right to obtain full reimbursement on those claims if AHA prevails in its legal challenge to the OPPS regulation. The objective of the letter would be to provide notice of hospital’s ongoing reliance on the MACs’ notices and to furnish sufficient basic information about the claims under dispute to support an argument that the hospital has sufficiently appealed its 340B denials or sufficiently preserved its appeal rights beyond the expiration of the normal deadlines for requesting a redetermination (or reconsideration) in light of the extraordinary circumstances surrounding the 340B litigation.