STAT+: Hospitals sue – again – to halt Trump administration’s 340B rebate pilot

The American Hospital Association is once again taking the Trump administration to court over its plan to transform a federal drug discount program into one that provides rebates instead of upfront discounts for certain drugs. This is the second time the influential hospital lobbying group has sued over a similar proposal. The first lawsuit, filed in 2025, resulted in a judge temporarily blocking a narrower version of the plan, which ultimately led the Health and Human Services Department to withdraw the plan after losing on appeal.

In February, the agency unveiled a broader version, scheduled to commence on January 1, 2027, which would target 25 of the most expensive and widely used drugs covered under Medicare. The initial plan encompassed 10 drugs. The AHA's main contention mirrors the arguments presented in the initial case: the government failed to accurately calculate the expenses hospitals would face by paying market prices for these drugs and subsequently applying for rebates.

The lawsuit claims that the Health Resources and Services Administration, the HHS division responsible for administering the 340B program, received over 2,400 comments on the rebate model's latest iteration, with hospitals providing detailed accounts of the "catastrophic impact" it would have on their operations. To continue reading STAT+ for the complete story, please refer to the original source.