Changing hospital eligibility for the 340B drug program | Bills and Laws

The skinny

Three Republican House members have introduced the 340B Access Act, which would impose tougher rules for participating in a federal program that allows hospitals to buy some drugs at lower prices.

Republican lawmakers are pushing new, tougher eligibility requirements for hospitals to participate in the 340B drug pricing program.

Sponsors

U.S. Reps. Larry Bucshon, MD, (R-Ind.), Buddy Carter (R-Ga.), and Diana Harshbarger (R-Tenn.) are the prime sponsors of the bill.

Summary

The lawmakers sponsoring the bill say the measure is needed to improve accountability and ensure that the program is truly helping those in need.

The sponsors say the bill would impose new eligibility requirements for hospitals who want to participate in the 340B drug pricing program. The program enables hospitals to buy some outpatient medications at lower prices.

Lawmakers say the legislation is needed to ensure that the program is helping hospitals who are truly serving large populations of disadvantaged patients.

Sponsors say the bill would also ensure patients are getting discounts. The measure would require the U.S. Department of Health & Human Services to produce reports on how providers are using savings from the 340B program, and hospitals would be required to report financial data to the department.

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Analysis

Hospitals, policymakers and lawmakers have clashed over the 340B drug pricing program.

Some Republican lawmakers, including the sponsors, have said that the 340B program has ballooned beyond its intended purpose. Some critics have said that hospitals are not offering enough charity care, particularly in light of discounts they are receiving from the program.

“The 340B drug pricing program was originally created to serve as a lifeline for thousands of Hoosiers and millions of Americans who struggle to afford life-saving medications," Bucshon said in a statement. "However, in recent years the program has rapidly expanded, with a lack of transparency, clarity, and accountability threatening its future.”

Hospitals have said the 340B program provides essential support to help patients from disadvantaged communities, in urban and rural areas. Hospitals and health groups fought back when the government reduced 340B payments, ultimately taking their case to the U.S. Supreme Court and winning a unanimous decision from the high court.

Some drug companies have also been reducing the scope of their discounts, angering hospitals and health providers and leading to more legal battles.

In January 2023, about 2,600 hospitals participated in the 340B program, according to the U.S. Government Accountability Office.

Supporters

A group known as The Alliance to Save America’s 340B Program has endorsed the legislation. The alliance’s membership includes the Pharmaceutical Research and Manufacturers Association, the Community Oncology Alliance, and other groups.

Thomas Johnson, executive director of the alliance, said the bill “embodies the clear and comprehensive approach to reform that our coalition has been advocating for. Most importantly, this legislation ensures patients in underserved communities directly benefit from the program.”

Critics

Hospitals are pushing back against a measure that would reduce the number of hospitals participating in the program.

Maureen Testoni, president, and CEO of 340B Health, a group representing hospitals participating in the federal drug pricing program, denounced the bill.

"The 340B ACCESS Act is the legislative version of a pharmaceutical industry wish list for major cuts to 340B," Testoni said in a statement. “Drug companies already have imposed unilateral restrictions on 340B that have harmed patient access to care. Now the industry wants to enlist Congress in slashing eligibility for 340B, dialing back its responsibilities to support the health care safety net, and boosting its profit margins even more.”

Testoni added, “If this bill were to become law, it would decimate the resources that enable crucial care and eliminate effective curbs on drug price hikes for 340B and non-340B drugs alike.”

In addition, 340B Health has backed a separate bill, the 340B Patients Act, that is designed to prevent drug companies from reducing discounts and ensuring access to the program. U.S. Rep. Doris Matsui, D-Calif., has sponsored that bill.

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