The 340B Drug Pricing Program costs patients more in the long run by moving care to hospital outpatient settings rather than physicians' offices, according to a recent analysis commissioned by the drugmaker lobby Pharmaceutical Research and Manufacturers of America.
The research conducted by Berkeley Research Group is the latest skirmish in a battle over the program, which the American Hospital Association, America's Essential Hospitals and the Association of American Medical Colleges argue help safety net hospitals access affordable prescription drugs.
The report looked at Medicare Part B reimbursements for physician-administered medicine and found that 30% of payments were at 340B hospitals in 2017, a jump from 9.6% in 2008. Reimbursements at 340B hospitals increased for breast cancer, rheumatoid arthritis and multiple myeloma treatments.
The program aims to help underserved communities get prescription drugs in safety net facilities. More hospitals have joined the program in recent years. In 2017, covered entities purchased more than $19 billion in drugs, a 114% increase since 2014.
With that growth has come controversy, including regulatory and legal fights.
Research has shown that drug spend at 340B hospitals is about one-third higher than at non-340B facilities. A New England Journal of Medicine report found that the 340B project "drives hospital/physician consolidation while not expanding care to low-income populations or improving their mortality rates."
Critics like PhRMA and some lawmakers charge that the federal government doesn't provide enough oversight or know how much hospitals are benefiting from the program. The group has criticized HHS reform efforts surrounding 340B reform, which it believes puts too much of a burden and risk on drug manufacturers.
The Trump administration attempted to cut 340B payments by 30%. However, a federal judge rejected those reductions in December. AHA, AEH and other groups that filed the lawsuit, alleged that the government "exceeded its statutory authority when it cut" the payments.
The 340B program changed Jan. 1. The reworked program includes letting participating facilities access 340B drug manufacturers' prices and impose financial penalties for overchargers.
Earlier this month, HHS launched a website with prescription drug ceiling prices for the program. The Office of Pharmacy Affairs 340B Information System allows facilities to register and manage their participation in the program and now lets hospitals check drug prices and verify their accuracy. HRSA could fine drug manufacturers if they overcharge 340B facilities.