Drug discount supporters to strategize on 340B program

Safety net providers and clinics that participate in the 340B Drug Pricing Program will meet next month to address criticism that some 340B participants are abusing the discount program.

Drugmakers and some lawmakers have called for tougher oversight because some hospitals are receiving discounted drug benefits despite serving a small number of low-income patients.

The program requires drugmakers to discount outpatient medications by as much as 50% at hospitals and clinics that serve large numbers of low-income and uninsured patients. The Affordable Care Act allowed more hospitals to become eligible for the program, and the number of participants has grown sharply. Providers say the expansion has helped them treat low-income patients as drug prices have climbed.

But an analysis by Avalere Health found that roughly two-thirds of hospitals participating in 340B provide less charity care than the average U.S. hospital, with charity care making up 1% or less of many participating facilities’ spending. An analysis conducted by the Berkeley Research Group found that drug purchases made at the 340B price rose from $1.1 billion in 1997 to more than $7 billion in 2013; such purchases are projected to reach more than $16 billion by 2020.

In March, members of the House Energy and Commerce Committee discussed the effectiveness of the program.

The upcoming 340B conference, scheduled for July 13-15 in Washington, will focus on a new Health Resources and Services Administration guidance on the 340B program that is intended to clarify eligibility and other issues.