Press Releases

Washington, D.C. – 8/31/26… Today, Congressman Mike Lawler (NY-17) sent a letter urging Centers for Medicare & Medicaid Services (CMS) Administrator Mehmet Oz to reconsider a proposed change to Medicare reimbursement for the 340B Drug Pricing Program, warning that the policy could put additional financial pressure on safety net hospitals and threaten access to care for vulnerable patients in New York.

Additional signers of the letter include Nick LaLota (NY-01), Andrew Garbarino (NY-02), Nicole Malliotakis (NY-11), Nick Langworthy (NY-23), Claudia Tenney (NY-24).

In a letter submitted Monday as part of the public comment process for CMS’s Calendar Year 2027 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Proposed Rule, Rep. Lawler and his New York colleagues raised concerns over the agency’s proposal to reduce Medicare reimbursement for certain 340B acquired drugs from the current rate of Average Sales Price (ASP) plus 6% to ASP minus 33.4%. This represents a nearly 40% reduction in payments to safety net hospitals.

CMS estimates the proposal would reduce Medicare spending on 340B-acquired drugs by approximately $4.55 billion in its first year. And while the agency plans to redistribute this money through increased payments for non-drug outpatient services, this approach will disproportionately affect the safety net hospitals that the 340B program is intended to support, cutting a critical source of funding for communities in need. 

In New York, the proposed change is estimated to result in approximately $900 million in annual reductions to hospitals participating in the 340B program.

“Safety net hospitals that utilize 340B already operate under extremely difficult financial circumstances, and many don’t have the resources to compensate for the reductions in revenue on 340B drug payments. Our principal concern is that this steep payment change could ultimately impact their ability to maintain services and jeopardize access to care for patients,” wrote the lawmakers. 

The full letter can be found HERE. 

Congressman Lawler is one of the most bipartisan members of Congress and represents New York's 17th Congressional District, which is just north of New York City and contains all or parts of Rockland, Putnam, Dutchess, and Westchester Counties. He was rated the most effective freshman lawmaker in the 118th Congress, 8th overall, surpassing dozens of committee chairs.

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