`(Slip Opinion)
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` OCTOBER TERM, 2021
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`Syllabus
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`1
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` NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
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` being done in connection with this case, at the time the opinion is issued.
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` The syllabus constitutes no part of the opinion of the Court but has been
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` prepared by the Reporter of Decisions for the convenience of the reader.
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` See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
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`SUPREME COURT OF THE UNITED STATES
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` Syllabus
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`AMERICAN HOSPITAL ASSOCIATION ET AL. v.
`BECERRA, SECRETARY OF HEALTH AND HUMAN
`SERVICES, ET AL.
`CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
`
`THE DISTRICT OF COLUMBIA CIRCUIT
` No. 20–1114. Argued November 30, 2021—Decided June 15, 2022
`
`The Medicare statute lays out a formula that the Department of Health
`and Human Services must employ annually to set reimbursement
`rates for certain outpatient prescription drugs provided by hospitals to
`Medicare patients. 42 U. S. C. §1395l(t)(14)(A)(iii). That formula af-
`fords HHS two options. Option 1 applies if HHS has conducted a sur-
` vey of hospitals’ acquisition costs for each covered outpatient drug.
`
`Under this option, the agency may set reimbursement rates based on
`
` the hospitals’ “average acquisition cost” for each drug, and may “vary”
`the reimbursement rates “by hospital group.” §1395l(t)(14)(A)(iii)(I).
`
` Absent a survey, option 2 applies, and HHS must set reimbursement
`rates based on “the average price” charged by manufacturers for the
`drug
`as
`“calculated
`and
`adjusted
`by
`the Secretary.”
`§1395l(t)(14)(A)(iii)(II). Option 2 does not authorize HHS to vary re-
`
` imbursement rates for different hospital groups. From the time these
`
`provisions took effect in 2006 until 2018, HHS did not conduct surveys
`of hospitals’ acquisition costs, relied on option 2, set the reimburse-
`
` ment rates at about 106 percent, and did not vary those rates by hos-
` pital group. For 2018, HHS again did not conduct a survey. But this
`
`
`time it issued a final rule establishing separate reimbursement rates
` for hospitals that serve low-income or rural populations through the
`
`340B program and all other hospitals. For 2019, HHS set reimburse-
`
`ment rates the same way.
`
`The American Hospital Association and other interested parties
`
`challenged the 2018 and 2019 reimbursement rates in federal court.
`
`In response, HHS first contended that various statutory provisions
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`precluded judicial review of those rates. The agency also argued that
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`AMERICAN HOSPITAL ASSN. v. BECERRA
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`Syllabus
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`it could vary the reimbursement rates by hospital group under its op-
`
`tion 2 authority to “adjust” the price-based reimbursement rates. The
`
`District Court rejected HHS’s argument that the statute precluded ju-
`
`dicial review, concluded that HHS had acted outside its statutory au-
`
`thority, and remanded the case to HHS to consider an appropriate
`
`
`
`remedy. The D. C. Circuit, however, reversed. The court ruled that
`the statute did not preclude judicial review, and upheld HHS’s reduced
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`reimbursement rates for 340B hospitals.
`Held:
`
`1. The statute does not preclude judicial review of HHS’s reimburse-
`
`
`ment rates. Judicial review of final agency action is traditionally
`
`
`available unless “a statute’s language or structure” precludes it, Mach
`
`Mining, LLC v. EEOC, 575 U. S. 480, 486, and this Court has long
`
`recognized a “strong presumption” in its favor, Weyerhaeuser Co. v.
`United States Fish and Wildlife Serv., 586 U. S. ___, ___. Here, no
`
`provision in the Medicare statute precludes judicial review of the 2018
`
`and 2019 reimbursement rates. HHS cites two nearby provisions that
`preclude review of the general payment methodology that HHS em-
`
`
`ploys to set rates for other Medicare outpatient services. See
`
`§§1395l(t)(12)(A), (C). But HHS sets rates for outpatient prescription
`
`drugs using a different payment methodology. HHS also argues that
`other statutory requirements would make allowing judicial review of
`
`the 2018 and 2019 reimbursement rates impractical. Regardless, such
`
`
`arguments cannot override the text of the statute and the traditional
`presumption in favor of judicial review of administrative action. Pp.
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`7–9.
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`
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`2. Absent a survey of hospitals’ acquisition costs, HHS may not vary
`
`the reimbursement rates only for 340B hospitals; HHS’s 2018 and
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`2019 reimbursement rates for 340B hospitals were therefore unlawful.
`
`The text and structure of the statute make this a straightforward case.
`
`
`Because HHS did not conduct a survey of hospitals’ acquisition costs,
`HHS acted unlawfully by reducing the reimbursement rates for 340B
`
`hospitals. HHS maintains that even when it does not conduct a sur-
`
`vey, the agency still may “adjus[t]” the average price “as necessary.”
`
`§1395l(t)(14)(A)(iii)(II). But HHS’s power to increase or decrease the
`
`price is distinct from its power to set different rates for different groups
`
`
`of hospitals. Moreover, HHS’s interpretation would make little sense
`given the statute’s overall structure. Under HHS’s interpretation, the
`agency would never need to conduct a survey of acquisition costs if it
`could proceed under option 2 and then do everything under option 2
`that it could do under option 1. That not only would render irrelevant
`
`
`
`the survey prerequisite for varying reimbursement rates by hospital
`group, but also would render largely irrelevant the provision of the
`
`statute that precisely details the requirements for surveys of hospitals’
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`3
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`Cite as: 596 U. S. ____ (2022)
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`Syllabus
`acquisition costs. See §1395l(t)(14)(D). Finally, HHS’s argument that
`
`Congress could not have intended for the agency to “overpay” 340B
`
`
`hospitals for prescription drugs ignores the fact that Congress, when
`
`enacting the statute, was well aware that 340B hospitals paid less for
`covered prescription drugs. It may be that the reimbursement pay-
`ments were intended to offset the considerable costs of providing
`healthcare to the uninsured and underinsured in low-income and rural
`
`communities. Regardless, this Court is not the forum to resolve that
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`policy debate. Pp. 9–14.
`967 F. 3d 818, reversed and remanded.
`KAVANAUGH, J., delivered the opinion for a unanimous Court.
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` Cite as: 596 U. S. ____ (2022)
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`Opinion of the Court
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`1
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` NOTICE: This opinion is subject to formal revision before publication in the
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` preliminary print of the United States Reports. Readers are requested to
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` notify the Reporter of Decisions, Supreme Court of the United States, Wash-
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` ington, D. C. 20543, of any typographical or other formal errors, in order that
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` corrections may be made before the preliminary print goes to press.
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`SUPREME COURT OF THE UNITED STATES
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`_________________
`
` No. 20–1114
`_________________
` AMERICAN HOSPITAL ASSOCIATION, ET AL.,
`
` PETITIONERS v. XAVIER BECERRA,
`SECRETARY OF HEALTH AND
`
` HUMAN SERVICES, ET AL.
`ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
`
`APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT
`[June 15, 2022]
`JUSTICE KAVANAUGH delivered the opinion of the Court.
`Under the Medicare statute, the Department of Health
`
`
`and Human Services must reimburse hospitals for certain
`outpatient prescription drugs that the hospitals provide to
`
`Medicare patients. HHS’s total reimbursements to hospi-
`tals for prescription drugs add up to tens of billions of dol-
`lars every year.
`To set the reimbursement rates for the prescription
`
`
`drugs, HHS has two options under the statute. First, if
`HHS has conducted a survey of hospitals’ acquisition costs
`for the drugs, HHS may set the reimbursement rates based
`
`on the hospitals’ average acquisition costs—that is, the
`
`amount that hospitals pay to acquire the prescription
`drugs—and may vary the reimbursement rates for different
`
`groups of hospitals. Second and alternatively, if HHS has
`not conducted such a survey, HHS must instead set the re-
`imbursement rates based on the average sales price
`
`charged by manufacturers for the drugs (with certain ad-
`
`justments), and HHS may not vary the reimbursement
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` AMERICAN HOSPITAL ASSN. v. BECERRA
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`Opinion of the Court
`rates for different groups of hospitals.
`
`For 2018 and 2019, HHS did not conduct a survey of hos-
`pitals’ acquisition costs for outpatient prescription drugs.
`But HHS nonetheless substantially reduced the reimburse-
`ment rates for one group of hospitals—Section 340B hospi-
`tals, which generally serve low-income or rural communi-
`ties. For those 340B hospitals, this case has immense
`economic consequences, about $1.6 billion annually.
`
`The question is whether the statute affords HHS discre-
`
`tion to vary the reimbursement rates for that one group of
`hospitals when, as here, HHS has not conducted the re-
`
`quired survey of hospitals’ acquisition costs. The answer is
`no. We therefore reverse the judgment of the U. S. Court of
`
`Appeals for the D. C. Circuit.
`I
`A
`In 2003, Congress passed and President George W. Bush
`
`
`signed landmark legislation expanding Medicare to cover
`prescription drugs. See Medicare Prescription Drug, Im-
`
`provement, and Modernization Act of 2003, 117 Stat. 2066,
`42 U. S. C. §1395. Under that 2003 law, HHS must annu-
`ally set reimbursement rates for certain outpatient pre-
`scription drugs provided by hospitals. §1395l(t)(14).
`
`The Medicare statute meticulously lays out the formula
`that HHS must employ to set those reimbursement rates.
`As relevant here, the agency’s reimbursement rate for each
`covered outpatient prescription drug “shall be equal” to one
`of two measures:
`“(I) to the average acquisition cost for the drug for that
`year (which, at the option of the Secretary, may vary by
`hospital group (as defined by the Secretary based on
`
`volume of covered OPD services or other relevant char-
`acteristics)), as determined by the Secretary taking
`into account the hospital acquisition cost survey data
`under subparagraph (D); or
`
`2
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` Cite as: 596 U. S. ____ (2022)
`
`Opinion of the Court
`“(II) if hospital acquisition cost data are not available,
`the average price for the drug in the year established
`under section 1395u(o) of this title, section 1395w–3a
`of this title, or section 1395w–3b of this title, as the case
`
`may be, as calculated and adjusted by the Secretary as
`
`paragraph.”
`necessary
`for
`purposes
`of
`this
`
`§1395l(t)(14)(A)(iii) (emphasis added).
`
`
`To simplify a bit: Congress afforded HHS two options to
`
`set the reimbursement rates for hospitals. Option 1 applies
`if the agency has conducted a survey of hospitals’ acquisi-
`tion costs—that is, the amount that hospitals pay to acquire
`the prescription drugs. If the agency has conducted a sur-
`
`vey and collected that data, HHS may set reimbursement
`
`rates based on the hospitals’ “average acquisition cost” for
`
`see also
`each drug.
`See §1395l(t)(14)(A)(iii)(I);
`§1395l(t)(14)(D) (requirements for conducting surveys of
`hospitals’ drug acquisition costs). Importantly for present
`purposes, if HHS has conducted a survey of hospitals’ ac-
`quisition costs, option 1 authorizes HHS to vary those re-
`imbursement rates for different groups of hospitals.
`
`Option 2 applies if HHS has not conducted a survey of
`
`
`hospitals’ acquisition costs.
`In that circumstance, the
`agency must set reimbursement rates based on “the aver-
`age price” charged by manufacturers for the drug, as “cal-
`culated and adjusted by the Secretary as necessary for pur-
`poses of ” this statutory provision. §1395l(t)(14)(A)(iii)(II).
`
`The statute in turn sets “the average price” as 106 percent
`of the drug’s average sales price. See ibid. (citing §1395w–
`3a). Critically, option 2 does not authorize HHS to vary re-
`imbursement rates for different groups of hospitals.
`
`
`
`For more than a decade after those provisions took effect
`in 2006, HHS did not conduct a survey of hospitals’ acqui-
`sition costs. Indeed, HHS has only once attempted to con-
`duct such a survey—in 2020, after this litigation com-
`
`menced. At oral argument in this Court, the Government
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`AMERICAN HOSPITAL ASSN. v. BECERRA
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`Opinion of the Court
`explained that HHS had not previously attempted to con-
`duct such surveys because the surveys are “very burden-
`some on the study takers,” are “very burdensome on the
`hospitals,” and do not “produce results that are all that ac-
`curate.” Tr. of Oral Arg. 41–42.
` As a result, until 2018, HHS consistently relied on option
`2 and set reimbursement rates for each drug based on the
`average-sales-price data provided by manufacturers. Every
`year, HHS set the reimbursement rates at about 106 per-
`cent of each covered drug’s average sales price, and HHS
`used the same reimbursement rates for all hospitals. In
`other words, until 2018, HHS never varied the reimburse-
`ment rates by hospital group. See Medicare Program: Hos-
`pital Outpatient Prospective Payment and Ambulatory
`Surgical Center Payment Systems and Quality Reporting
`Programs, 82 Fed. Reg. 52490, 52494–52495 (2017).
` During its rulemaking for 2018, HHS proposed a change
`to reduce the reimbursement rates only for 340B hospitals.
`Importantly, HHS did not conduct a survey of hospital ac-
`quisition costs. As a policy matter, HHS said that its exist-
`ing reimbursement rates resulted in what the agency
`viewed as overpayments to hospitals that serve low-income
`or rural populations through the federal 340B program.
`Federal law requires drug manufacturers to sell prescrip-
`tion drugs to those 340B hospitals at prices below those
`paid by other hospitals. See 42 U. S. C. §256b(a)(1) (setting
`a “ceiling price” that manufacturers can charge to 340B hos-
`pitals). Consistent with the Medicare statute, however,
`HHS historically had reimbursed 340B hospitals for cov-
`ered outpatient prescription drugs at the same reimburse-
`ment rates that were set for all other hospitals. For 2018,
`HHS said that the uniform reimbursement rates combined
`with the discounted prices paid by 340B hospitals for pre-
`scription drugs meant that 340B hospitals were able to
`“generate significant profits” when they provided the pre-
`scription drugs to Medicare patients. 82 Fed. Reg. 52494.
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`

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`Opinion of the Court
`In response to HHS’s proposed change, the 340B hospi-
`
`tals countered that, under the Medicare statute, HHS could
`not single out 340B hospitals without conducting a survey
`of hospitals’ acquisition costs. With respect to HHS’s policy
`arguments, the 340B hospitals explained that the reim-
`bursement payments for prescription drugs helped those
`hospitals offset the considerable costs of providing
`healthcare to the uninsured and underinsured in low-
`income and rural communities. The 340B hospitals pointed
`out, moreover, that Congress had long been aware of the
`
`situation. Indeed, the hospitals claimed that Members of
`Congress not only were aware, but actually intended for the
`
`340B program’s drug reimbursements to subsidize other
`
`services provided by 340B hospitals. The hospitals noted
`that Congress had never singled out 340B hospitals for
`lower Medicare reimbursements for outpatient prescription
`
`drugs. Nor, until 2018, had HHS ever done so. Further-
`more, the 340B hospitals asserted that reducing their reim-
`bursement rates for prescription drugs would force those
`hospitals to eliminate or dramatically curtail other crucial
`
`programs that provide a wide range of medical services in
`
`low-income and rural communities—such as treatments for
`
`cancer, mental health issues, opioid addiction, and diabe-
`tes.
`
` In the final rule for 2018, HHS decided to establish two
`
`separate reimbursement rates: one rate for non-340B hos-
`pitals and another rate for 340B hospitals. The reimburse-
`ment rate for non-340B hospitals remained at the historical
`
`rate of approximately 106 percent of the average sales price
`for each drug. But HHS established a substantially re-
`duced rate for 340B hospitals—a rate equal to 77.5 percent
`of the average sales price for each drug. In setting that rate,
`HHS relied on an estimate from the Medicare Payment Ad-
`visory Commission that 340B hospitals obtained prescrip-
`tion drugs at an average discount of at least 22.5 percent
`below the average sales price charged by manufacturers.
`
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` AMERICAN HOSPITAL ASSN. v. BECERRA
`
`Opinion of the Court
`Id., at 52496, 52499. HHS estimated that the reduction in
`
`the reimbursement rates for 340B hospitals would save
`
`Medicare (and deprive 340B hospitals of ) about $1.6 billion
`
`annually, which by law would be re-allocated for other Med-
`icare services. Id., at 52509–52510. For 2019, HHS set re-
`imbursement rates for 340B hospitals in the same way.
`
`
`
`When setting the 2018 and 2019 reimbursement rates,
`HHS acknowledged that it had not conducted a survey of
`hospitals’ acquisition costs—the statutory prerequisite for
`varying the reimbursement rates by hospital group. Id., at
`52496. Nonetheless, HHS pointed to its statutory authority
`
`under option 2 to “adjust” the average price “ ‘as necessary
`for purposes of ’” this statutory provision. Id., at 52499.
`
`
`HHS claimed that its authority to “adjust” the average price
`for each drug also implicitly encompassed the authority to
`vary the reimbursement rates by hospital group. Ibid.
`B
`The American Hospital Association, along with two other
`
`hospital industry groups and several hospitals, sued in
`
`U. S. District Court to challenge HHS’s 2018 and 2019 re-
`imbursement rates for 340B hospitals. Among other things,
`
`the Hospitals asserted that HHS did not conduct a survey
`
`of hospitals’ acquisition costs and therefore could not im-
`pose different reimbursement rates on different groups of
`hospitals.
`
`In response, HHS first contended that various statutory
`
`provisions precluded judicial review of the 2018 and 2019
`reimbursement rates. As relevant here, HHS further ar-
`gued that it could vary the reimbursement rates by hospital
`group under its authority to “adjust” the price-based reim-
`bursement rates, even though HHS had not conducted a
`survey of hospitals’ acquisition costs.
`The District Court ruled for the Hospitals. The court re-
`
`jected HHS’s argument that the statute precluded judicial
`review. On the merits, the court concluded that HHS had
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`

`7
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` Cite as: 596 U. S. ____ (2022)
`
`Opinion of the Court
`acted outside its statutory authority, and the court re-
`manded to HHS for the agency to consider an appropriate
`remedy. See American Hospital Assn. v. Azar, 385 F. Supp.
`
`
`3d 1 (DC 2019) (remedy); American Hospital Assn. v. Azar,
`348 F. Supp. 3d 62 (DC 2018) (merits).
`
`
`A divided panel of the U. S. Court of Appeals for the D. C.
`Circuit reversed. On the question of judicial review, the
`court unanimously ruled that the statute did not preclude
`
`judicial review. See American Hospital Assn. v. Azar, 967
`
`F. 3d 818, 824 (2020). On the merits, however, the court
`upheld HHS’s reduced reimbursement rates for 340B hos-
`pitals. Id., at 828.
`
`In dissent, Judge Pillard contended that HHS’s reduced
`
`reimbursement rates for 340B hospitals contravened the
`text and structure of the statute. Id., at 835. In her view,
`“HHS may institute its large reductions, tailored for a dis-
`tinct hospital group,” only if the agency has conducted the
`
`required survey of hospitals’ acquisition costs. Ibid.
`
`This Court granted certiorari. 594 U. S. ___ (2021).
`
`II
`
`HHS first argues that the Medicare statute precludes ju-
`
`dicial review of the 2018 and 2019 reimbursement rates.
`
`See 42 U. S. C. §1395l(t)(12). The Court of Appeals rejected
`HHS’s preclusion argument, as did the District Court. We
`
`likewise conclude that the statute does not preclude judicial
`review of HHS’s reimbursement rates.
`
`
`This Court has long recognized a “strong presumption” in
`favor of judicial review of final agency action. Weyerhaeuser
`Co. v. United States Fish and Wildlife Serv., 586 U. S. ___,
`
`___ (2018) (slip op., at 11) (quoting Mach Mining, LLC v.
`EEOC, 575 U. S. 480, 489 (2015)). Judicial review of final
`agency action in an otherwise justiciable case is tradition-
`ally available unless “a statute’s language or structure” pre-
`cludes judicial review. Mach Mining, 575 U. S., at 486.
`
`No provision in the Medicare statute precludes judicial
`
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`

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` AMERICAN HOSPITAL ASSN. v. BECERRA
`
`Opinion of the Court
`review of the 2018 and 2019 reimbursement rates. More-
`over, the detailed statutory formula for the reimbursement
`rates undermines HHS’s suggestion that Congress implic-
`itly granted the agency judicially unreviewable discretion
`
`to set the reimbursement rates. Cf. Weyerhaeuser Co., 586
`
`U. S., at ___−___ (slip op., at 13−14).
`HHS cites two provisions—§§1395l(t)(12)(A) and (C)—
`
`that preclude judicial review of HHS’s “development of the
`classification system under paragraph (2)” and “periodic ad-
`justments made under paragraph [(9)].” But both of those
`provisions refer to the general payment methodology that
`HHS employs to set rates for other Medicare outpatient ser-
`
`vices. By contrast, when HHS sets rates for outpatient pre-
`scription drugs, it uses a different payment methodology—
`
`namely, the methodology specified by paragraph (14) of
`
`§1395l(t). And nothing in the statute precludes judicial re-
`view of reimbursement rates set under paragraph (14).
`HHS further argues that allowing judicial review of the
`
`2018 and 2019 reimbursement rates would be impractical
`because the agency is required to operate the program on a
`budget-neutral basis. Due to that budget-neutrality re-
`quirement, HHS says that a judicial ruling invalidating the
`2018 and 2019 reimbursement rates for certain hospitals
`
`would require offsets elsewhere in the program. The Hos-
`pitals respond that various potential remedies could make
`
`340B hospitals whole for the past shortfalls without run-
`ning afoul of the budget-neutrality provision. At this stage,
`we need not address potential remedies. Regardless, HHS’s
`arguments against judicial review cannot override the text
`of the statute and the traditional presumption in favor of
`judicial review of administrative action.
`In sum, HHS’s preclusion argument lacks any textual ba-
`
`sis. We agree with the District Court and the Court of Ap-
`peals that the Medicare statute does not preclude judicial
`review of the 2018 and 2019 reimbursement rates.
`
`
`
`
`
`8
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`

`9
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` Cite as: 596 U. S. ____ (2022)
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`Opinion of the Court
`
` III
`
`
` We turn next to the merits. The question is this: If HHS
`
` has not conducted a survey of hospitals’ acquisition costs,
`may HHS still vary the reimbursement rates for outpatient
`prescription drugs by hospital group? The answer is no.
`
`The 2003 Medicare Act authorizes HHS to set reimburse-
`
`ment rates for covered outpatient prescription drugs pro-
`vided by hospitals. The Act also specifies how HHS must
`
`42 U. S. C.
`set
`those
`reimbursement
`rates.
`
`§1395l(t)(14)(A). The statute therefore reflects a careful
`congressional focus not only on the goal of proper reim-
`bursement rates, but also on the appropriate means to that
`end.
`To reiterate, the statute affords HHS two options for set-
`
`ting reimbursement rates for outpatient drugs. Option 1
`applies if HHS collects “hospital acquisition cost survey
`data” from hospitals. §1395l(t)(14)(A)(iii)(I). If the agency
`has conducted a survey and collected that data, then HHS
`
`may use the data to set reimbursement rates equal to “the
`
`average acquisition cost for the drug.” Ibid. Importantly,
`in that circumstance, HHS may “vary” reimbursement
`rates “by hospital group.” Ibid.
`
`By contrast, if HHS does not conduct a survey of hospi-
`tals’ acquisition costs and if acquisition cost data are there-
`fore “not available,” HHS must instead proceed under op-
`tion 2 and obtain price data from drug manufacturers.
`§1395l(t)(14)(A)(iii)(II). And in that circumstance, HHS
`must set reimbursement rates based on “the average price
`
`for the drug” as “calculated and adjusted by the Secretary
`as necessary for purposes of ” this statutory provision. Ibid.
`
`
`
`Critically, that second option does not authorize HHS to
`
`vary reimbursement rates by hospital group. Instead, HHS
`
`must set uniform reimbursement rates for all hospitals for
`each covered drug, and the rates must be equal to the aver-
`age price for that drug for that year.
`
`HHS’s authority to proceed under option 1 and to vary
`
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`

`10
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` AMERICAN HOSPITAL ASSN. v. BECERRA
`
`Opinion of the Court
`
` reimbursement rates by hospital group thus depends on
`
`whether HHS has obtained acquisition cost survey data
`from hospitals. The statute expressly authorizes HHS to
`vary rates by hospital group if HHS has conducted such a
`survey. But the statute does not authorize such a variance
`
`in rates if HHS has not conducted a survey. Cf. Babb v.
`
`Wilkie, 589 U. S. ___, ____ (2020) (slip op., at 12); Sandoz
`
`Inc. v. Amgen Inc., 582 U. S. ___, ___ (2017) (slip op., at 16);
`Russello v. United States, 464 U. S. 16, 23 (1983).
`The statute thus protects all hospitals by imposing an im-
`
`portant procedural prerequisite—namely, a survey of hos-
`pitals’ acquisition costs for prescription drugs—before HHS
`may target particular groups of hospitals for lower reim-
`bursement rates. The survey allows the agency to deter-
`mine whether there is in fact meaningful, statistically sig-
`nificant variation among hospitals’ acquisition costs. The
`data regarding variation in hospitals’ acquisition costs in
`
`turn help HHS determine whether and how much it should
`
` vary the reimbursement rate among hospital groups. See
`
` §§1395l(t)(14)(D)(iii)–(iv). But absent that survey data, as
`
` not make
`Congress
`determined, HHS may
`“billion-dollar decisions differentiating among particular
`hospital groups.” 967 F. 3d, at 837 (Pillard, J., dissenting).
`
`
`In this case, all agree that HHS did not conduct a survey
`
`of hospitals’ acquisition costs. See, e.g., 82 Fed. Reg. 52501.
`
`HHS nonetheless varied the rates by hospital group, fixing
`a substantially lower reimbursement rate for 340B hospi-
`
`tals than for non-340B hospitals.
`
`Under the text and structure of the statute, this case is
`
`therefore straightforward: Because HHS did not conduct a
`survey of hospitals’ acquisition costs, HHS acted unlawfully
`
`by reducing the reimbursement rates for 340B hospitals.
`
`
`HHS maintains that there is more to the case than that
`straightforward analysis would suggest. HHS emphasizes
`
`that even when it does not conduct a survey of acquisition
`costs and thus is required to employ option 2 (based on
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`
` price), the agency still may “adjus[t]” the average price “as
`
`necessary for purposes of ” this statutory provision.
`
`§1395l(t)(14)(A)(iii)(II).
`
`
`It is true that the statutory text of option 2 affords HHS
`discretion to adjust the average price. The parties here vig-
`
`orously debate how much HHS may adjust the price. To
`
`resolve this case, however, we need not determine the scope
`of HHS’s authority to adjust the price up or down.
`
`
`Regardless of the scope of HHS’s authority to “adjust” the
`
`average price up or down under the statute, the statute
`does not grant HHS authority to vary the reimbursement
`rates by hospital group unless HHS has conducted the re-
`quired survey of hospitals’ acquisition costs. Under the
`statute, varying a rate by hospital group is not a lesser-
`included power of adjusting price. Otherwise stated, HHS’s
`power to increase or decrease the price is distinct from its
`
`power to set different rates for different groups of hospitals.
`
`The text of option 2 confirms the point. It requires reim-
`bursement in an “amount” that is equal to “the average
`price for the drug in the year.” Ibid. The text thus requires
`the reimbursement rate to be set drug by drug, not hospital
`by hospital or hospital group by hospital group. The only
`
`item that the agency is allowed to adjust is the “average
`
`
`price for the drug in the year.” Ibid. Such an adjustment
`
`
`can consist of moving the average-price number up or down,
`but it cannot consist of giving a single drug two different
`average prices for two different groups of hospitals. (Tell-
`ingly, before 2018, the agency never used its adjustment au-
`thority to vary reimbursement rates by hospital group.)
`
`Moreover, HHS’s contrary interpretation of the statute—
`and its broad understanding of its adjustment authority—
`would make little sense given the statute’s overall struc-
`ture. To proceed under option 1 (based on cost) and vary
`
`the rate by hospital group, HHS must conduct a survey. In
`HHS’s view, the agency can decline to conduct a survey and
`can proceed under option 2, and then can still do everything
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` AMERICAN HOSPITAL ASSN. v. BECERRA
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`Opinion of the Court
`under option 2 that it could do under option 1—including
`varying the reimbursement rates by hospital group. So un-
`der HHS’s interpretation, the agency would never need to
`conduct a survey of hospitals’ acquisition costs. But why,
`then, would Congress have constructed this elaborate stat-
`ute premised on HHS’s surveys of hospitals’ acquisition
`costs, including specifying when HHS could vary reim-
`bursement rates by hospital group? HHS has no good an-
`
`swer to that question.
`
`HHS’s interpretation not only would render irrelevant
`
`the survey prerequisite for varying reimbursement rates by
`
`hospital group, but also would render largely irrelevant the
`provision of the statute that precisely details the require-
`ments for surveys of hospitals’ acquisition costs. See
`§1395l(t)(14)(D). We must hesitate to adopt an interpreta-
`tion that would eviscerate such significant aspects of the
`
`
`statutory text. See, e.g., Chicago v. Fulton, 592 U. S. ___,
`
`___ (2021) (slip op., at 5); Maine Community Health Options
`v. United States, 590 U. S. ___, ___ (2020) (slip op., at 16);
`
`Whitman v. American Trucking Assns., Inc., 531 U. S. 457,
`
`484−485 (2001).
`
`In short, the statute allows HHS to set reimbursement
`rates based on average price and affords the agency discre-
`tion to “adjust” the price up or down. But unless HHS con-
`ducts a survey of hospitals’ acquisition costs, HHS may not
`vary the reimbursement rates by hospital group.
`
`As a final argument, HHS insists that Congress could not
`have intended for the agency to “overpay” 340B hospitals
`for prescription drugs. But when enacting this statute in
`2003, Congress was well aware that 340B hospitals paid
`
`less for covered prescription drugs. After all, that had been
`
`the law for the duration of the 340B program, which began
`
`in 1992. In 2003, Congress nonetheless did not see fit to
`differentiate 340B hospitals from other hospitals when re-
`quiring that the reimbursement rates be uniform under op-
`tion 2. And for more than a decade after this statute took
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`effect, HHS employed option 2 but did not differentiate
`340B hospitals from other hospitals—an agency practice
`that was known in the wider hospital industry and in Con-
`gress.
`
`If HHS believes that this Medicare reimbursement pro-
`
`gram overpays 340B hospitals, it may conduct a survey of
`hospitals’ acquisition costs to determine whether and how
`
`much the data justify varying the reimbursement rates by
`
`hospital group—for example, reducing reimbursement
`
`rates paid to 340B hospitals as compared to other hospitals.
`
`Or if the statute’s requirement of an acquisition cost survey
`is bad policy or is working in unintended ways, HHS can
`ask Congress to change the law.
`
`
`Of course, if HHS went to Congress, the agency would
`presumably have to confront the other side of the policy
`story here: 340B hospitals perform valuable services for
`low-income and rural communities but have to rely on lim-
`
`ited federal funding for support. As amici before this Court,
`many 340B hospitals contend that the Medicare reimburse-
`ment payments at issue here “help offset the considerable
`costs” that 340B providers “incur by providing health care
`
`to the uninsured, underinsured, and those who live far from
`hospitals and clinics.” Brief for 37 State and Regional Hos-
`pital Associations as Amici Curiae 7. As the 340B hospitals
`
`see