The Trump administration is cutting generous subsidies that Medicare pays so-called safety-net hospitals for prescription drugs, a move that was supported by the pharmaceutical industry, but is prompting threats of lawsuits from major hospital groups.

In a rule released on Wednesday night, the Centers for Medicare and Medicaid Services indicated it will cut reimbursement for medicines purchased under the federal 340B Drug Discount Program, which was designed to boost revenues for hospitals that primarily serve low-income patients.

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