The AIDS Healthcare Foundation (AHF) filed a complaint this week against the Department of Health Care Services (DHCS), seeking an injunction to prevent the implementation of the new state law aimed at 340B providers.

The new law became effective on Oct. 1, 2009 (CHA News Oct. 16), and states that hospitals participating in the 340B discount drug purchasing program are required to dispense only 340B program-purchased drugs to Medi-Cal patients. Hospitals are also required to bill Medi-Cal an amount not to exceed the provider’s acquisition cost for the drug, plus the professional and dispensing fees.

The AHF complaint against DHCS asserts that, “the State of California unfortunately, and illegally, has tried to address its budget woes by reducing Medi-Cal payment rates to nonprofit, safety net medical providers, paying less to these providers than it pays to for-profit businesses for the very same services.”

CHA will continue to work with DHCS on this issue and will follow the AHF lawsuit. Contact: Anne McLeod at (916) 552-7536 or amcleod@calhospital.org.