Threats to 340B Undermine Program Intent

Disturbing Question: Is a 340B Program Worth It?

In a September 29, 2020 article published in Pharmacy Times, authors K. Maxik, C. Kimble, and A. Coustasse caution hospitals to consider the real costs before implementing a 340B program within their organizations. 

Wait, what? Of course safety net hospitals should utilize 340B drug pricing to offset the costs of providing uncompensated care, right? Isn't the intent of the program to offer more quality, comprehensive services to improve health outcomes for the underserved? Why would an eligible safety net provider choose not to participate?

The Centers for Medicare and Medicaid Services (CMS) and 340B program detractors don't necessarily agree, citing the lack of "clear evidence" that drug discounts translate to improved patient outcomes or direct patient savings.  The answer regarding 340B non-participation is convoluted, but essentially starts here: 

The US Court of Appeals recently upheld HHS' decision to reduce Medicare Part B outpatient drug payments to 340B hospitals by nearly 30%.

In addition to the dramatic reduction in reimbursement, this article urges eligible entities to take the following expenses into account before deciding if their organization should institute a 340B program:

• Split billing software
• New employees to monitor compliance and revenue
• Administrative burden to existing staff
• Cost of third-party consultant(s)
• GPO prohibition
• Contract pharmacy fees 

340B program-wide criticism continues from all sides, and unfortunately, CMS isn't the only organization cutting reimbursement for 340B drugs... but that's a journal for another day.

Today, I lament that safety net providers utilizing 340B drugs are becoming so disincentivized by external threats, both governmental and private, that instituting or continuing a 340B program may no longer provide meaningful savings to provide care for those whom the program is intended to help. 

The good news? You can fight back. I urge everyone to vote and contact your local, state, and federal legislators! Join together with other covered entities to form stronger advocacy networks. What better time to do it than while we're all stuck at home?

Advocate by raising awareness of the benefits that 340B safety net organizations provide to the communities they serve, as well as the multitude of threats which could render the 340B program untenable. Your stories are every bit as powerful as the "data" collected by 340B program detractors.

Finally, make sure your organization's 340B program is a shining example of compliance with both program rules and intent. Program detractors most frequently cite the lack of pass-through savings to patients, lack of oversight, and unmanageably large contract pharmacy networks. Proving them wrong will bolster the strength of the 340B community and its' voice in guiding future legislation.

Not sure where to start? Reach out and let us help.