DC Journal: Fixing the 340B Program Should be a Priority

By Kasia Mulligan, Patients Come First’s National Spokesperson

While the Trump administration has been productive during these first few months in office, one battle that is absolutely worth fighting didn’t seem to make the priority “fix-it” list after the Department of Health and Human Services made a legal move to reject implementing innovative 340B reforms.

The 340B drug pricing program was a genuine desire to make prescription medications more affordable for low-income Americans and to increase hospitals’ care for underserved populations. Like many well-intentioned government programs, bad actors have taken advantage of 340B and abused the system for their own gain.

The 340B program’s fatal flaw is a lack of transparency. Under the current system, hospitals and healthcare providers buy medications at a discounted price. They are supposed to use these savings to provide cheaper medicines to patients in need. 

However, there is no guarantee that hospitals will offer discounts to patients. Indeed, many facilities use the savings to fund unrelated projects and excessive executive compensation.

New polling indicates that the American people have had enough. Lawmakers have long discussed fixing the program, but the American people want their leaders to stop talking and start acting to ensure that hospitals and healthcare providers are required to pass discounted drug savings directly to patients.

Since 86 percent of respondents want lawmakers to address loopholes in the drug discount system to ensure transparency and accountability, these savings ought to benefit the patients who need them.

Americans are sick and tired of middlemen preventing patients from receiving necessary care. The poll found that 77 percent of people think that when hospitals receive discounted prices on prescription drugs, they should be required to pass along 100 percent of the savings to the patient receiving the medications. If the 340B program functioned this way in practice, low-income and uninsured patients could see the cost of their medications reduced by as much as 50 percent.

The survey results prove the public is hungry for action. It will take time for the legislative process to play out. Until lawmakers can fix the 340B program for good, short-term changes would immediately relieve vulnerable patients.

One proposed solution is to shift the 340B program to a rebate model. Under this alternative, drug manufacturers would provide participating healthcare providers with a rebate after confirming that the provider was properly approved to access 340B pricing. This would be a first step toward ensuring a qualifying patient receives a discount. Not only that, a rebate model would be a significant improvement over the status quo and align with what Americans support.

The survey demonstrated that people approve of this “trust but verify” approach, with 79 percent agreeing that a rebate model would guarantee greater transparency and ensure drug discounts are not kept by hospitals or middlemen.

This rebate-style model is the best way to deliver immediate savings to needy patients. So, it is concerning that HHS recently made a legal move to dismiss proposed 340B hospital discount reforms — effectively sidelining reform to keep the status quo.

Adding much-needed transparency would benefit needy patients, boost government efficiency and reduce waste.  Without reform, the 340B program’s lack of transparency caused it to grow rapidly in recent years.

Read the full op-ed here in the DC Journal.