HHS publishes 340B drug ceiling prices in concession to hospital lobby
- Following eight years of delay, the Health Resources & Services Administration (HRSA), an HHS agency, launched a website Monday listing prescription drug ceiling prices for the 340B Drug Pricing Program. The Office of Pharmacy Affairs 340B Information System, where facilities can register and manage their participation in the program, now allows hospitals to check drug prices and verify their accuracy.
- HHS was originally supposed to publish the prices in July 2018 but pushed it and other new requirements off for another year over legal concerns. The American Hospital Association, along with other hospital trade groups, sued the department in September to publish the delayed regulations determining the maximum 340B ceiling prices. HHS settled and agreed to implement the rule in November.
- HRSA has civil monetary penalty authority, meaning drugmakers could be fined if they're found to knowingly overcharge 340B facilities — important given research that drug spend at 340B hospitals is roughly one-third higher than at their non-340B counterparts.
The 340B program changes, originally passed under the Affordable Care Act in 2010, officially took effect Jan. 1. They include provisions granting participating facilities access to 340B drug manufacturers' prices and imposing financial penalties on any unscrupulous overchargers.
The final regulation implementing the changes was issued in January 2017, but HHS delayed the effective date of the regulations five times.
The Trump administration was met with fierce pushback from hospitals when it decided to delay publishing the regulations (including the maximum price limit) for a fifth time, until July 2019. AHA applauded the administration's about-face Monday, saying in a statement it was "pleased that, in response to our successful lawsuit, the Health Resources and Services Administration today launched a new website to shine needed light on 340B drug pricing, which the government has found lacking."
The AHA and other provider lobbies believe 340B price transparency is key to make sure participating hospitals aren't being overcharged or otherwise duped by drugmakers.
The 340B Drug Discount Program is intended to help underserved communities access prescription drugs in safety-net facilities. It's been controversial of late, with critics calling for increased oversight of the program, including the White House, which released a FY 2020 budget proposal including HRSA regulatory authority over 340B and requiring covered entities report their savings and how the money is used.
The Trump administration also floated 30% cuts to 340B facility reimbursements, though a federal judge struck down the planned reductions in December.
Proponents of the program like AHA cast it as a necessary way for safety-net hospitals to acquire affordable medications.
"The availability of accurate, up-to-date drug prices is essential for making sure that nonprofit hospitals, community health centers and federal funded clinics get the deep discounts required by the Congressionally-enacted 340B program so that they can better serve low-income patients," former HHS general counsel Bill Schultz said in a statement. Schultz is a firm partner at Zuckerman Spaeder, which represented the hospital groups in the 340B litigation.
- Health Resources & Services Administration 340B OPAIS
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