Dive Brief:
- Hospitals and the HHS are questioning GAO findings that hospitals serving high numbers of low- income patients abuse a federal drug discount via the 340B Drug Pricing Program by overprescribing medications.
- The GAO report found that in hospitals using 340B discounts, Medicare Part B drug spending per beneficiary in 2008 and 2012 was substantially higher than other hospitals.
- Provider trade groups say the GAO did not take into account other reasons for the higher spending; for example, that 340B hospitals often treat sicker patients.
Dive Insight:
The 340B program has existed since 1992 but expanded after the ACA to include more providers. The GAO report suggested that "over prescribing may be the way hospitals maximize Medicare revenues. While hospitals may be financially benefitting...this poses potentially serious consequences to the Medicare program and its beneficiaries." The organization suggested Congress should consider eliminating the incentive to prescribe more drugs than necessary to treat beneficiares.
Criticism of the GAO results ranges from faulty analysis to a lack of evidence and data. HHS raised concerns with the results as well: "We are concerned that the report characterizing spending on Part B in 340B DSH hospitals...is not supported by the study methodology," the agency said. "GAO's study, which only examined the average difference in per-beneficiary spending by hospital type, did not examine any patient differences in terms of outcomes or quality."
The Health Resources Services Administration, the federal agency that regulates 340B, estimated the program saved providers $3.8 billion in drug costs in 2013, according to Modern Healthcare.