Latest news with #340B
Int'l Business Times
5 hours ago
- Business
- Int'l Business Times
At No Cost to Federal Government a Lifeline for America's Communities
As the U.S. healthcare system wrestles with rising costs and deepening disparities, one federal program quietly continues to serve as a financial and clinical lifeline for millions of Americans: the 340B Drug Pricing Program. Since its inception in 1992, 340B has enabled safety net hospitals, community health centers, and other providers to purchase outpatient medications at reduced prices. These savings aren't about boosting bottom lines—they're about keeping doors open, expanding access to care, and delivering essential services for all. At its heart, 340B is about getting medicine—and the healthcare services needed to ensure their safe and effective use—to people who otherwise might go without it. It empowers hospitals that serve high numbers of uninsured and modest-income patients, as well as Federally Qualified Health Centers (FQHCs) and Ryan White clinics that reach the working poor. The savings realized under 340B are not pocketed. These providers invest funds directly into programs that offer mental health services, treat substance use disorders, fund mobile clinics, and support chronic disease management. In many cases, access to the 340B program is the determining factor in whether a provider can afford to keep its pharmacy open to serve those who would otherwise go without treatment. The 340B program is a small program with big benefits. The discounts provided account for only 3% of drug companies' global revenues . At the same time, drug price increases continue to rise faster than inflation. In the United States, where drug companies already benefit from federally supported insurance programs and drug prices that are over three times higher than the rest of OECD countries, the 340B program is a reasonable accommodation to meet their obligations to be good corporate citizens. While the impact of the 340B program on drug companies is minimal, the impact on health is significant. Take community health centers, for example. These organizations are often the only providers in rural towns or urban neighborhoods. With the help of 340B, they can offer sliding scale fees, reach out to patients who are unhoused or living in poverty, and provide preventive care and health screenings that are crucial in addressing rising healthcare costs. For diseases like diabetes, 340B drug pricing ensures access to both medications as well as the patient education and healthcare provider services needed to effectively manage a complex chronic condition. In short, they make health more than a buzzword—they make it real. Hospitals also depend on 340B to sustain emergency rooms, neonatal intensive care units, and oncology programs. Small rural hospitals in particular often rely on these savings to remain operational. When one of these facilities shuts down, the consequences are immediate and severe: longer travel times for urgent care, delayed treatments, and a deeper strain on already stressed healthcare systems. Despite its impact, 340B has come under fire from some in the pharmaceutical industry and others who argue the program is being misused or lacks sufficient oversight. While oversight improvements are a worthy discussion, such criticisms ignore the real-world pressures providers face: skyrocketing drug prices, declining reimbursements, and the increasing demand for services as the population ages and grows more medically complex. Along with reasonable reforms that support program integrity, it's time to make common sense changes to reduce the regulatory burden on providers and let them focus on their main job—delivering high-quality health care to all. In the current budgetary environment, maintaining the 340B program is more important than ever. The program doesn't add to the federal budget. Instead, it gives healthcare providers the means to stretch existing resources further—just as Congress intended. Reducing or eliminating the 340B program to increase the profit of global pharmaceutical companies would shift costs to patients while simultaneously putting additional strains on state and federal budgets at the worst possible time. Undermining the 340B program would not just threaten individual institutions—it would unravel an already fragile health infrastructure. The people most affected would be those with the fewest options: modest and low-wage workers, rural residents, and those without insurance. The 340B program is a critical bridge between affordability and access, between policy and people. While reforms of the program may be useful, it is imperative they be guided with an overarching goal of improving how the program works for patients, not of providing a windfall for pharmaceutical manufacturers, who have experienced record profits since the program's inception. Weakening the 340B program would be short-sighted and harmful. Strengthening it is a fiscal imperative—for hospitals, clinics, and all communities. Author: Jane L. Delgado, Ph.D., M.S., is a highly esteemed and in-demand analyst and thought leader. She is the President and CEO of an NGO, Healthy Americas Foundation (HAF). She sits on the boards of the U.S. Soccer Foundation (Chair, Audit), McLean Hospital (Belmont, MA), the National Biodefense Science Advisory Board, the Lovelace Biomedical Research Institute (Investment Committee), and Argonne National Labs (Chair, Compensation).
Politico
a day ago
- Health
- Politico
Lawmakers push for transparency in 340B program
Beat Memo New York lawmakers are looking to create transparency in a drug rebate program offered to hospitals serving low-income communities, with a state mandate to report how the federal program's revenue is used, POLITICO Pro's Katelyn Cordero reports. The legislation — which is the Assembly Health Committee and expected to be introduced in the Senate in the coming days — would require hospitals participating in the 340B drug discount program to report their use of funds acquired through the program to the state Department of Health. The program's original intent was to have safety-net hospitals invest the profits back into the community or pass savings directly to patients, but lawmakers have raised concerns about where the money is actually going. 'It's just a pretty straightforward transparency bill reporting on information that, in theory, should otherwise already be available,' bill sponsor Assemblymember Amanda Septimo told POLITICO. 'So it's really compiling and sharing information, not necessarily new data collection. We don't expect it to be burdensome.' A separate piece of legislation reintroduced in January, known as the 340B Prescription Drug Anti-Discrimination Act, would bar pharmaceutical companies from imposing administrative requirements that could discourage providers from participating in the program. Septimo said such an expansion of the program should only be considered with the proper guardrails in place. 'The (bills) should work in tandem,' she said. 'It's difficult to make a meaningful case for the expansion of something when you don't have any meaningful data to report, with respect to how it's working as it exists.' The legislation introduced by Septimo in March would require that hospitals report all 340B savings and payments associated with drugs in the program, as well as the total number of prescriptions and the percentage of prescriptions covered by the program. The Department of Health would be required to post the collected data on a public site. Hospitals would be required to report data on the program by April 1, 2026. IN OTHER NEWS: — One Brooklyn Health is partnering with NYU Langone to expand access to kidney transplants in Brooklyn. The health system's new program will offer transplant evaluations, clinical testing and specialist consultations to patients with advanced kidney disease at Brookdale Hospital. Patients will also receive support from social workers, financial counselors and a care navigator. — Gov. Kathy Hochul announced four appointments to the newly restructured board of the Nassau Health Care Corporation, which oversees the financially struggling Nassau University Medical Center on Long Island: Stuart Rabinowitz, Amy Flores, Dean Mihaltses and Lisa Warren. Under a new state law that took effect Sunday, the corporation is subject to several new oversight measures and must submit a study by Dec. 1, 2026, exploring options to strengthen the medical center. ON THE AGENDA: — Wednesday at 10 a.m. The Public Health and Health Planning Council's committee on establishment and project review meets. — Thursday, 10 a.m. to 1 p.m. The New York State Traumatic Brain Injury Services Coordinating Council meets. MAKING ROUNDS: — Kathleen Sikkema will serve as interim dean of the Columbia Mailman School of Public Health, effective July 1. She succeeds Linda P. Fried, who previously announced plans to step down at the end of the academic year. GOT TIPS? Send story ideas and feedback to Maya Kaufman at mkaufman@ and Katelyn Cordero at kcordero@ Want to receive this newsletter every weekday? Subscribe to POLITICO Pro. You'll also receive daily policy news and other intelligence you need to act on the day's biggest stories. What you may have missed — Democratic lawmakers negotiated a deal with the state Education Department s last week on a measure that would expand access to birth control for New Yorkers, as the state faces provider shortages and federal attacks on reproductive health care. Two bills moving through the Senate and Assembly are aimed at allowing pharmacists to administer birth control shots without a provider's prescription and requiring private insurance to pay pharmacists for consulting with patients seeking birth control prescriptions, POLITICO Pro's Katelyn Cordero reports. — An issue brief by the New York Health Plan Association, which found the state mandates insurance coverage of more than 45 specific treatments or services, recommended that the state develop a process to review the cost of such requirements. 'The collective impact of mandated benefits contributes to the growth in health insurance premiums, adds to the cost of coverage for everyone – consumers, employers, union benefit funds and the state – and runs counter to efforts to make New York more affordable,' HPA President and CEO Eric Linzer said in a statement. 'Before new mandated benefits are passed, there should be a process to analyze their impact on the affordability of coverage, so that there's a clear understanding of what they cost.' Odds and Ends NOW WE KNOW — A new Covid strain has landed in New York. TODAY'S TIP — Easily distracted? Here are some ways to improve your attention span. STUDY THIS — Ending water fluoridation could cost nearly $10 billion over five years, and tooth decay would also rise, according to a Harvard analysis. What We're Reading — State health regulators signal support for long-awaited trauma center in the Rockaways. (Crain's New York Business) — The dizzying rise of MAHA warrior Calley Means, RFK Jr.'s right-hand man. (Vanity Fair) — Medicare plots ambitious tech agenda guided by former Palantir and Main Street Health executives. (STAT) — American doctors are moving to Canada to escape the Trump administration. (KFF Health News) Around POLITICO — Via Carmen Paun and Robbie Gramer: State Department explains why it's reorganizing its global health security bureau. — Iowa Sen. Joni Ernst spars with town hall crowd over Medicaid, Cheyanne M. Daniels reports. MISSED A ROUNDUP? Get caught up on the New York Health Care Newsletter.
Yahoo
5 days ago
- Business
- Yahoo
Ohio's Cleveland Clinic faces questions over booming subsidies
A medical exam room. File photo from Federal officials are raising questions about exploding drug discounts under a program meant to fund services for low-income patients, and Ohio's Cleveland Clinic is at the center of some of them. Over a 38-month period ending in June 2023, the massive nonprofit hospital received nearly $1 billion from the program. However, the clinic didn't cut drug prices for any of its low-income patients, instead plowing the money into its general budget. Officials at the clinic told congressional investigators that they used the money in other ways to help poor patients. Yet in 2023, the nonprofit hospital had enough money to pay 22 of its executives more than $1 million and another 30 over $500,000 — and still finish the year with nearly $1 billion in 'net income.' A private business would call that 'profit.' For its part, the clinic pointed out that its operating income was much smaller than that, and that it spent almost as much on free or discounted care in 2023. Cleveland Clinic was one of two hospitals to come under scrutiny as part of a U.S. Senate investigation of a drug-discounting program known as 340B. It requires drugmakers who want to sell their products to Medicaid patients to also sell them to qualifying hospitals and clinics at deep, legally defined discounts. The hospitals and clinics then sell them at much higher prices and pocket the difference — notionally, to provide care to people who can't afford it. When it was created in 1992, 340B was intended to free up money and make federal resources go further for providers who cared for a heavy mix of low-income and underinsured patients. But after the Affordable Care Act passed in 2010 and the 340B rules were changed, the amount of discounts provided under the program exploded — from $5 billion a year to nearly $67 billion in 2023. That's not free money, and the discounts to 340B providers are made up by other payers — including the poor, said Antonio Ciaccia, a Columbus-based drug-pricing analyst. As the amount of that money grew 13-fold in as many years, the Senate Health, Education, Labor, and Pensions Committee wanted to know whether 340B was really fulfilling the program's goal to 'stretch scarce Federal resources as far as possible.' The multi-year investigation focused on two hospitals. 'These hospitals were selected for this investigation as a result of media reports alleging abuse of the 340B Program, such as hospitals cutting services to underserved populations and expanding into affluent areas to increase reimbursement rates and subsequent revenue under the 340B Program,' the committee report, which was released last month, said. The other hospital chain, Cincinnati-based Bon Secours Mercy Health, will be the subject of a separate story. Regarding Cleveland Clinic, the Senate report referred to a 2022 Wall Street Journal story. It said the hospital didn't admit enough Medicaid and low-income patients to qualify under the original 340B rules. But under a quirk in the new rules, it was allowed in as a 'rural-referral center' even though it's headquartered in the middle of a big city. In analyzing the data the submitted by Cleveland Clinic, the Senate committee found that between April 2020 and June 2023, the hospital chain received $934 million in benefit from the 340B program. Yet, even though the reason for the program's existence is to support care for people who can't do so themselves, Cleveland Clinic didn't use those funds to directly defray patients' drug costs. 'Cleveland Clinic… explained that it does not pass 340B discounts directly to patients because 'there is no dollar-for-dollar, pass-on requirement to patients under the 340B statute' and the statute 'was intentionally left general to provide safety-net providers with latitude on how they use their savings in the ever-changing health care industry,'' the report said. Instead, Cleveland Clinic said it 'applies its 340B benefit 'to the health system's overall operating expenses and revenues in order to offset the cost of providing health care services to the communities [it] serve[s] and to maintain and invest in programs that enhance patient services and access to care.'' Cleveland Clinic said it didn't track the 340B millions after putting them in the revenue pot. But it said it spends huge amounts underwriting care for low-income Ohioans. In 2023, it provided $261 million in free or discounted care to more than 110,000 patients, a spokeswoman said on background. The clinic is the leading provider of Medicaid services, charity care and mental health services in Ohio, she said. She also pointed out that in 2024, Cleveland Clinic had an operating margin of $276 million, while it spent $261 million discounting care a year earlier. However, that excludes income the tax-exempt nonprofit makes from its sizable investments. When you include that, Cleveland Clinic made $911 million in net income in 2023, Healthcare Dive reported. Also, those narrow operating margins come after paying out hefty salaries. According to Cleveland Clinic's 2023 IRS Form 990, President and CEO Tom Mihaljevic was paid $7 million. That was more than 100 times Ohio's median household income for that year. In all, more than 50 of the top decision-makers at Cleveland Clinic made more than $500,000 as they set and enacted a budget subsidized by hundreds of millions of 340B dollars that are notionally meant to support charity care. 'Cleveland Clinic sets executive compensation in accordance with the process developed by the IRS to ensure that such compensation is determined in a fair and impartial manner taking relevant comparative data into account,' the clinic's spokeswoman said. In its response to the Senate report, Cleveland Clinic claimed the 340B program doesn't cost taxpayers. 'As the cost of providing healthcare continues to rise, the 340B program helps us save resources that would have otherwise been spent on purchasing medications but instead can be directed to providing care, at no additional taxpayer expense,' it said. However, just as others have to pay the taxes nonprofits don't, drugmakers don't simply absorb the tens of billions in discounts they're required to give under the 340B program, said Ciaccia, the drug pricing analyst. In fact, many of the low-income patients the program is supposed to benefit help pay for it. That's because those with private insurance — or who are uninsured — don't pay for drugs on the basis of 340B discounts. They have to pay based on the inflated prices the clinic and its contracted pharmacies charge in order to generate the program's income. Everyone with employer-based insurance also pays because those plans also don't get the 340B discount — or in some cases even a slice of manufacturer rebates they might get in non-340B pharmacy transactions, Ciaccia said. And, as with so many other things, increased insurance costs are usually passed on to consumers. Ciaccia added that as with rebates, mandatory 340B discounts give drugmakers an incentive to increase the list prices of drugs — increases that are felt most acutely by those who are least able to pay. 'In recent years, the list prices for drugs have arguably exploded, creating greater and greater pressure for government programs, employers, and sick patients to access medicines — not through actual affordable prices — but instead through negotiated or mandated discounts off of those bloated prices,' Ciaccia said. 'Programs like 340B double down on our system's addiction to discounts, pressuring the list prices of medicines higher. But instead of passing those discounts through, the end payer gets stuck with a bloated tab at the pharmacy counter. One way or another, the bill always comes due.' SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX SUPPORT: YOU MAKE OUR WORK POSSIBLE
Yahoo
6 days ago
- Business
- Yahoo
East Liverpool City Hospital losing access to discounted prescription program
EAST LIVERPOOL, Ohio (WKBN) – The East Liverpool City Hospital's Outpatient Pharmacy was recently named the best of the best community pharmacy in the Columbiana County area, but an important program it participates in is ending Friday. The 340B program has been popular at East Liverpool City Hospital. Across an area in Ohio, Pennsylvania and West Virginia, 1,800 people use it. Director of Pharmacy Bill Smith said the program allows them to offer typically expensive drugs at a discounted rate. The hospital no longer qualifies for the 340B program, however. The hospital sent letters last week explaining the change, and the pharmacy has been working with patients to prepare. 'We're refilling drugs as we can, within the guidance of Ohio law, and we'll help them as much as we can,' Smith said. The retail pharmacy is not closing. It has served over 4,000 patients over the last six months. It will still offer generic drugs at discounted rates, and two new pharmacy benefits managers may even have a lower price for a prescription than other retail stores. Patients will be able to ask about the new prices. 'Any prescription written from any provider, we can give patients prices and tell them what they will be,' Smith said. Losing the 340B program is tough. It filled the prescription needs of hospital outpatients, plus patients from the resident clinic, post op, wound care and the Wellsville rural health clinic. 'For those expensive drugs, we won't be able to offer the discounted rate. We may still be cheaper than what patients pay at other retail stores, based upon their insurance or if they're uninsured,' Smith said. East Liverpool City Hospital will reapply for the 340B program next year at this time to see if it qualifies again. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
20-05-2025
- Health
- Yahoo
Tax breaks, drug discounts — and no receipts: The 340B abuse you're paying for
OHSU Hospital is located on Marquam Hill in southwest Portland. (Lynne Terry/Oregon Capital Chronicle) Beyond providing quality health care, tax-exempt hospitals have substantial responsibilities to the public. These hospitals not only avoid nearly all taxes — they also reap billions of dollars in financial benefits from a federal prescription drug program known as 340B. The 340B drug discount program was created in the 1990s to help low-income Americans access affordable medications and to support healthcare providers in underserved areas. But today, those drug discounts are being captured by corporate hospital systems and big box pharmacies, with no guarantee patients benefit at all. So, while Oregon hospitals are supposed to use 340B savings to improve access to affordable care for patients in need, there are significant questions as to whether they are meeting their obligations. We do know they are devoting less of their resources to charity care than the national average. And Oregon's big health systems are not exactly putting a damper on the doubts as they continue to fight to keep their finances and policies hidden from public view. Oregon Health & Science University (OHSU) and another U.S. hospital recently sued the federal government to block an audit on how the hospitals are handling their 340B dollars. This isn't an isolated case. It's part of a disturbing pattern across Oregon's tax-exempt 340B hospitals. Just look at Providence Health: Providence had to refund over $20 million in medical bills to low-income residents and cancel another $137 million in medical debt because of its over-aggressive debt collection practices, which were so egregious they warranted a feature in the New York Times describing how patients' lives were ruined. The hospital system was then accused with stonewalling an investigation by the Oregon Department of Justice into similar debt collection practices. And then, Providence – which, again, is supposed to be using its tax benefits and 340B resources to improve care to local communities – is attempting to sell its home health and hospice operations to an out-of-state private equity firm which could diminish care for thousands of Oregon residents. Hospitals are vital pillars of our communities. They are so important that it makes it all the more distressing when hospitals focus more on their financial bottom line than on keeping Oregonians healthy. A recent investigation by the U.S. Senate revealed that hospitals are collecting revenue through the 340B drug program, but fail to share those savings with their patients. The program is in dire need of reform but big hospitals and PBMs don't want to see alterations anytime soon. That's why they are lobbying state legislatures around the country to increase their access to 340B discounts. In Oregon, they're pushing House Bill 2385, expanding their access to 340B profits while doing nothing to ensure transparency or community benefit. This misguided bill doesn't protect patients. It protects powerful corporate institutions and undermines public trust. When hospitals benefit from taxpayer support, they have a duty to show how those dollars are used. Oregonians deserve answers. It's time for hospitals to open their books and prove they are truly serving the public — not exploiting the system for financial gain. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
