A coalition of safety net hospitals filed a federal lawsuit attempting to stop the CMS from making them collect and report coding data when billing Medicaid for drugs administered by physicians outside the hospital, a requirement intended to help states collect rebates from drug companies.
The hospitals argue that the CMS interpretation of the Deficit Reduction Act of 2006 conflicts with a section of the Social Security Act exempting hospitals that dispense covered drugs according to formularies, which already reflect discounts. Inputting the data, as required beginning July 1, is unreasonably burdensome on the hospitals, according to the Safety Net Hospitals for Pharmaceutical Access, a named plaintiff in the case along with the 588-bed University Medical Center in Las Vegas. The lawsuit was filed Aug. 21 in U.S. District Court in Washington.
In a news release, University Medical Center Chief Executive Officer Kathleen Silver said the reporting could cost her hospital as much as $5 million in 2008.
The CMS declined to comment. -- by Gregg Blesch