American Hospital Association v. Eric D. Hargan, Civil Action No. 2017-2447

The 340B Program (est. 1992) lets eligible hospitals buy certain outpatient drugs at discounted prices; hospitals contend Medicare reimbursement historically exceeded acquisition costs, creating surplus funds for safety-net services.
Under Medicare OPPS, Part B drug payments are set by statute using either average acquisition cost or, if unavailable, an average price (for 2018, ASP + 6%).
In the 2018 OPPS rule, CMS concluded 340B hospitals obtain drugs at substantial discounts and adopted a downward adjustment (applying ASP minus 22.5%) for drugs acquired through 340B, effective Jan 1, 2018.
Three hospital associations and three member hospitals sued under the APA, alleging CMS exceeded its statutory authority by reducing 340B reimbursement rates by ~30%, and sought a preliminary injunction to block implementation.
Defendants moved to dismiss for lack of subject-matter jurisdiction under Fed. R. Civ. P. 12(b)(1) and for failure to state a claim; the court focused on whether plaintiffs satisfied the Medicare Act’s judicial-review prerequisites (42 U.S.C. § 405(g)).
The court held plaintiffs had not presented any concrete reimbursement claims to the Secretary (they only submitted rulemaking comments), so § 405(g)’s presentment requirement was unsatisfied; case dismissed and preliminary-injunction motion denied as moot.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether federal court has jurisdiction under 42 U.S.C. § 405(g) to review challenge to OPPS 340B payment change	Commenters argued their rulemaking comments satisfy presentment and that exhaustion should be excused	HHS argued plaintiffs never presented concrete reimbursement claims to the Secretary and therefore § 405(g) bars district-court review	Held: No jurisdiction—plaintiffs failed § 405(g) presentment requirement; dismissal under Rule 12(b)(1)
Whether plaintiffs may obtain a preliminary injunction preventing the 2018 340B payment change	Plaintiffs sought to preserve status quo pending merits by enjoining implementation	Defendants opposed; argued case not properly before court	Held: Preliminary-injunction motion denied as moot after dismissal for lack of jurisdiction

Lujan v. Defenders of Wildlife, 504 U.S. 555 (standing burden and jurisdictional principles)
Mathews v. Eldridge, 424 U.S. 319 (§ 405(g) requires presentment and final decision after hearing)
Heckler v. Ringer, 466 U.S. 602 (anticipatory challenges lacking concrete claim are jurisdictionally defective)
Shalala v. Illinois Council on Long Term Care, Inc., 529 U.S. 1 (Medicare Act channels challenges and limits exceptions to exhaustion/presentment)
National Kidney Patients Ass’n v. Sullivan, 958 F.2d 1127 (D.C. Cir.) (presentment is absolute prerequisite to review)
Action Alliance of Senior Citizens v. Sebelius, 607 F.3d 860 (D.C. Cir.) (discusses presentment/exhaustion in Medicare context)