Congress should act on overwhelming support for changes to vital drug discount program
Over the last year, the pandemic has upended our normal lives, exacerbated health inequities, and tested the resiliency of our communities as we deal with the public health crisis and subsequent economic fallout. We have also seen a strong reliance on safety-net programs to stem the hardship faced by many Americans, making it all the more important for programs like the 340B Drug Pricing Program to work as intended: to serve as a vital safety-net for low-income, vulnerable, and uninsured patients to access the medicines they need. But a new poll found the majority of voters (70%) worry 340B is not working to benefit needy patients and that it is in dire need of reform.
Unfortunately, these findings do not come as a shock to anyone who has been keeping an eye on 340B over the last decade nor to the multiple watchdog organizations that have been waving the red flag for years. In short, the program was created by Congress in 1992 to help needy patients access their medications by requiring pharmaceutical manufacturers to provide steep discounts to some hospitals and federally qualified health providers that serve a high population of uninsured and low-income patients. Through these discounted drug purchases, nonprofit hospitals and clinics can help vulnerable patients access and afford their medicines. There are some entities that participate in the program and actually use it to help patients. In fact, community health centers and other clinics that participate in 340B, report out on how they are using 340B to support low-income patients as a condition of the federal grants they receive. Disproportionate share hospitals (DSH), on the other hand, have zero accountability or transparency measures in the program, which is troubling given their sizable role in the almost 500 percent growth in the 340B program over the last ten years.
To make matters worse, patients are not benefiting from this ballooned growth in the program. Instead, there is evidence that low-income patients’ ability to afford their medications is actually negatively correlated with the growth of the 340B program. At the same time, nearly two thirds of these 340B hospitals provide less charity care than the national average, and many continue to make headlines, in the middle of a global pandemic, for garnishing patients’ wages for unpaid bills and even refusing care for uninsured patients.
That raises the question: if the program has grown, including the number of participating DSH hospitals and contract pharmacies, and many patients still aren’t always benefiting, who is? An overwhelming majority of voters don’t think the answer should be hospitals and chain pharmacies. Nearly 80% of voters say hospitals should not be making money off of safety-net programs and that it is wrong for retail pharmacy chains to turn a profit on discounts that are intended to help low-income, uninsured, and vulnerable patients.
Congress cannot sit back and watch this long-standing abuse of 340B as bad actor hospitals and chain pharmacies profit from discounts meant for patients. If the last year has shown us anything, it is that we need strong safety-net programs to make sure patients can access their medications, and it is clear the public agrees.
Fortunately, all hope is not lost. During my time in Congress, I saw my colleagues work across the aisle for commonsense fixes to the most pressing issues of the time. And the time to fix 340B has long passed. We need substantial, holistic changes, including increased transparency and oversight of DSH hospitals and chain pharmacies, to make sure the program is working for the low-income, vulnerable, and uninsured communities that 340B was created to support.