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WASHINGTON — The Supreme Court on Wednesday sided with hospitals in a legal dispute over the Trump administration’s Medicare pay cuts for discounted drugs.

The case was a highly technical dispute over how the Department of Health and Human Services sets Medicare pay rates for prescription drugs. The lawsuit was over the 340B drug discount program, which allows some hospitals and other providers that serve enough low-income patients to buy discounted prescription drugs and use the savings to help cover other costs.


The Supreme Court ruled unanimously that HHS can’t lower its payment rates only for a certain subset of hospitals without conducting a survey first. The justices also held that courts have the right to review HHS decisions on Medicare pay rates.

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