Hospitals file second lawsuit to block Trump admin's 340B rebate pilot

The American Hospital Association (AHA) has filed another lawsuit against the federal government, challenging a new version of the 340B drug discount program proposed by the Trump administration.

The administration's plan would replace the traditional upfront discounts with after-the-fact rebates for a set of high-cost, widely used Medicare drugs, expanding the list from 10 to 25 drugs and slated to begin on Jan. 1, 2027.

The AHA argues that the Health Resources and Services Administration (HRSA) did not properly account for the financial impact on hospitals, echoing the arguments that led a judge to temporarily block an earlier, narrower version of the program in 2025.

The lawsuit follows the earlier legal setback that caused the Health and Human Services Department to withdraw the initial proposal after an appeal, highlighting ongoing tension between hospital groups and the administration over 340B reforms.