The Health Resources and Services Administration has revised its 340B Rebate Model Pilot Program, establishing a voluntary pathway for qualifying drug manufacturers to provide 340B ceiling prices through rebates rather than upfront discounts for a limited group of covered outpatient drugs.
This is HRSA’s second attempt at the model. The original version was set to launch Jan. 1, 2026, but a Maine federal court blocked it days before launch after the American Hospital Association and Maine Hospital Association sued, arguing HRSA violated the Administrative Procedure Act in developing the program. The First Circuit upheld the injunction, HHS agreed to drop its appeal, and the Maine court vacated the pilot and remanded it to HRSA. The agency then sought stakeholder feedback on whether and how to move forward.
That feedback shaped the new version. The comment period generated more than 2,400 submissions from hospitals, health centers, drug manufacturers, pharmacies, patient advocates and other stakeholders, according to a July 31 news release. Under the new framework, manufacturers would validate claims before paying rebates, giving HRSA more visibility into individual 340B transactions.
Hospital groups are pushing back again. AHA President and CEO Rick Pollack said the agency’s cost analysis understates the compliance expenses, cash-flow disruptions and operational burdens the model will impose on hospitals, particularly those in rural and underserved communities already under financial strain, according to a July 31 statement. The association said it is “considering all available options to prevent this flawed program from going into effect.”
America’s Essential Hospitals raised a similar objection. Beth Feldpush, the group’s senior vice president of policy and advocacy, said HRSA’s revised pilot overlooked comments essential hospitals submitted detailing the harm the model would cause to their patients, and took issue with the agency’s argument that the new reporting burden doesn’t add costs for providers since manufacturers already impose similar claims requirements on their own, according to a July 31 statement. Feldpush said the group continues to “urge the administration to rethink its approach.”
Manufacturers interested in participating must submit rebate plans to HRSA by Aug. 24, 2026. Approved plans for selected drugs will take effect Jan. 1, 2027.
At the Becker's 11th Annual IT + Revenue Cycle Conference: The Future of AI & Digital Health, taking place September 14–17 in Chicago, healthcare executives and digital leaders from across the country will come together to explore how AI, interoperability, cybersecurity, and revenue cycle innovation are transforming care delivery, strengthening financial performance, and driving the next era of digital health. Apply for complimentary registration now.