Oncologists sue HHS over Part B payment cuts: 5 things to know

The Community Oncology Alliance, a nonprofit representing more than 5,000 independent, community-based oncologists, filed a lawsuit against HHS and the White House Office of Management and Budget to halt a 2 percent Medicare sequester cut to the reimbursement or payment for Part B drugs, including cancer drugs.

Here are five things to know:

1. Sequestration, a cut to federal government spending, was triggered by the Budget Control Act of 2011, according to the alliance. CMS began applying a 2 percent budget sequester cut to Medicare Part B reimbursement, including drugs, in April 2013. The sequestration was extended on various occasions over the years and recently was extended another two years as part of the Bipartisan Budget Act of 2018. It is expected to continue through 2027.

2. The lawsuit, filed May 30 in the U.S. District Court for the District of Columbia, alleges the federal government acted illegally and violated the Constitution when it applied the sequestration to Part B drugs. It also claims the sequester cut has caused harm to patients, contributed to the closure or consolidation of independent community oncology practices, and resulted in billions in avoidable healthcare expense for seniors and taxpayers.

3. The lawsuit aims to stop CMS from applying the sequester cut to Part B drug reimbursement.

4. The lawsuit states: "In applying the sequestration to Part B drugs, defendants violated, and are continuing to violate, the separation-of-powers doctrine essential to our government's constitutional structure. The Medicare Modernization Act of 2003 provides an express statutory formula by which Medicare Part B outpatient providers or suppliers (not including hospitals) are to be paid or reimbursed for Part B drugs. By applying the sequestration to Part B drugs, defendants have invaded the legislative sphere by effectively amending the MMA."

5. The alliance said it sent a letter to HHS Secretary Alex Azar explaining why the complaint was a last resort, discussing why proposed Medicare Part B changes in President Donald Trump's drug-pricing plan will harm cancer patients and providing ideas on curbing rising cancer drug prices.

Read the full lawsuit here


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