Bipartisan support from Congress urges HHS to step up for 340B
On January 21st, six members of Congress penned a letter to the U.S. Department of Health and Human Services urging them to take swift enforcement action against drug manufacturers who are outright refusing, or enacting unreasonable and burdensome layers for Covered Entities to access discounts on 340B products through Contract Pharmacies.
To date, there have been thirteen drug manufacturers who are breaking the law with their actions. Despite numerous attempts to combat these cuts, as well as U.S. District Court judges ruling against manufacturers, multiple studies highlighting the huge impact of these cuts to our most vital healthcare providers, and even HRSA issuing enforcement letters stating that unless the violations are corrected, manufacturers face fines of up to $5,000 per instance of refusing 340B prices, HHS has been dragging it's feet on enforcing the law.
Enacted in 1992, the 340B Drug Pricing Program statute requires drug manufacturers that wish to receive Medicaid and Medicare drug benefits a discounted cost to certain safety net providers on eligible outpatient drugs. These medications can be dispensed to patients from an in-house pharmacy, and/or utilizing a network of contracted external pharmacies. Contract pharmacies make up about a quarter of most Covered Entity's 340B savings, and the losses as a result of these unilateral cuts are huge.
Larger facilities have reported a median loss of over $1 million, and a tenth of participants reported that they've lost $9 million or more. Small, rural providers such as Critical Access Hospitals are hit the hardest with an average of 39% loss in benefits due to these cuts. That breaks down to about $220,000 per facility.
The loss of 340B savings have a significant and serious impact on safety net facilities that already operate on razor-thin margins. Many have to reduce or eliminate services for our most vulnerable populations, or even close their doors altogether. In 2018, 340B hospitals provided 75% of care to Medicaid patients across the U.S. while only making up 43% of all acute care hospitals. Overall, 340B facilities provide a whopping 60% of uncompensated or unreimbursed care across the country.
While court battles and appeals continue to prolong this pain for Covered Entities, there are ways to still expand upon 340B savings opportunities in contract pharmacy networks. Optimal340B specializes in working out where 340B leakage is and realizing those savings for your facility and your patients. Every day you wait, you lose out on dollars. Contact Optimal340B today for a free consultation and to see how we can help you make your 340B, better. For you, for your patients.