340B Drug Pricing Program

pillsToday’s blog comes to us from the American Hospital Association’s Executive Vice President of Government Relations and Public Policy Tom NickelsThe focus is on the importance of the 340B Drug Pricing Program, which benefits vulnerable populations and communities. Among other things, the program provides important discounts, on drug prices, to hospitals that serve those who are struggling to afford the rising costs of medication. The pharmaceutical industry wants to do away with the program.

In a letter to the Health Resources and Services Administration (HRSA), Arizona Hospital and Healthcare Association (AzHHA) Senior Vice President for Policy Development, Debbie Johnston, wrote:

AzHHA strongly supports the 340B program’s current intent and purpose. It has enabled eligible hospitals and other covered entities to stretch scarce federal resources to support, expand and improve access to healthcare services in their communities. AzHHA members have used savings derived from the program to:

  • Provide financial assistance to patients unable to afford their prescriptions;
  • Fund and expand access to medical services, such as obstetrics, oncology and pediatrics;
  • Provide clinical pharmacy services relating to chronic disease and medication management;
  • Offer free immunizations; and 
  • Expand community outreach and education programs.

340bFor more on the 340B Drug Pricing program, you can watch a short video put together by the American Hospital Association or read the AHA blog below.

 Every day, we see stories about the exorbitant costs of prescription drugs and the serious challenges they pose for individuals and the entire health care system.

One program that has a 25-year track record of improving access to medications and health care services for people in vulnerable communities is the 340B Drug Pricing Program.

It requires pharmaceutical manufacturers participating in Medicaid to sell many outpatient drugs at discounted prices to health care organizations that care for large numbers of uninsured and low-income patients. Eligible hospitals use 340B savings to provide, among other services, local access to drugs and treatments for cancer patients, clinical pharmacy services, community outreach programs, free vaccinations and transportation to patients for follow-up appointments.

For example, the 340B program helps support the indigent drug program at Sacred Heart Hospital, which is the largest  provider of care to low-income individuals in Pensacola, FL. “The program sets up accounts for uninsured patients who frequently visit our Emergency Department because they cannot afford the medications they need to manage illnesses such as diabetes and high blood pressure,” Susan Davis, president and CEO of Sacred Heart Health System, writes in the Pensacola News Journal. “Thanks to the 340B program, Sacred Heart allows these patients to get their outpatient drugs at free or reduced cost and better control their medical conditions.”

Riverside University Health System, a safety-net provider in Riverside County, CA, uses 340B savings to fund medications for patients with no ability to pay. The program has “helped us embed clinical pharmacists in our outpatient clinics who help patients achieve the best outcome with medications, and continuing chemotherapy infusions for all patients,” writes Greg Prouty, chief pharmacist for the Riverside University Health System Medical Center, in an Op-Ed in the Press Enterprise.

And in Vermont, the 340B is critical to Rutland Regional Medical Center’s ability to care for patients. “Rutland’s Foley Cancer Center provides high-quality oncology care,” writes Jonathan Reynolds, a senior director at the medical center, in an Op-Ed for the Rutland Herald. “Patients would otherwise have to drive to Burlington or Hanover, New Hampshire, to receive chemotherapy or other oncology services … Without 340B, it is possible that Rutland Regional would have to rethink the services it provides, including possible elimination of some cancer services.”

The 340B program is not a financial burden to taxpayers and represents about only 2 percent of the pharmaceutical industry’s $457 billion in U.S. sales annually. However, the pharmaceutical industry continues to malign the program in hopes of scaling it back or eliminating it – yielding even bigger profits for themselves. That would have devastating consequences for vulnerable populations and communities across the country.  

Congress should preserve the 340B program and protect patients and communities.  


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