Save 340-B
​Corporate hospitals are pocketing billions of dollars from a federal program intended to help low income patients.
They're siphoning money from the federal 340B program to pad their profits at the expense of taxpayers and the communities the program was intended to help.
Learn more about this massive corporate abuse and how you can help stop it.
Putting profits over patients.
- Food & Drug Law Institute 2022
The 340B drug program was created by congress in the 1990s to stretch thin federal health care dollars and improve the quality of care provided to poor and underserved communities.
The program started simply. Drug companies that sell to Medicaid were required to also participate in 340B and required to sell deeply discounted drugs to 340B designated hospitals and clinics.
The designated 340B hospitals and clinics were supposed to use the savings generated by the program to provide discount drugs and improved care to their patients... At first, the program was working great...
Then Wall Street figured out that there were huge profits to be made by taking the 340B discount drugs meant for charity... and instead selling them at full price across town through the use of contract pharmacies.
Large corporations began buying up local community health clinics that were eligible to participate in the 340b program, using them to access the discount medications. The hospitals then sell those drugs to fully insured patients by contracting with pharmacies in wealthier neighborhoods, and selling the drugs meant for charity care for full price (or higher). The profit that was meant to improve care for patients in the original clinic are instead taken for profit.
A good idea gone bad.
Don't want to read all the reports? Watch this great video overview or listen to the podcast below.
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In your state.
Colorado
The cost of health care has gone up much more sharply in Colorado than nationally. These
increases are driven primarily by high hospital prices. In fact, on average, Colorado hospitals
charge some of the highest prices in the country.
Hospital profits have increased by more than 280% between 2009 and 2018, from $538 to $1,518 per adjusted discharge. Colorado hospitals’ prices went up far more sharply than the growth in patient volume. Colorado hospitals’ prices grew 71.3% between 2009 and 2018 (7.8% per year) while adjusted discharges* only grew 16.6% (1.8% per year).
Save 340-B
ACTION CENTER
Follow the Money
Profits have soared. Charitable care has not.
Hospital systems have come to treat 340B less as an assistance program and more as a profit center. This is possible because under current law, providers are under no obligation to reserve the discounts for needy patients or even report what they do with the savings. Just the opposite is happening. Eligible hospitals will obtain all their 340B medications from a drugmaker at the discounted 340B price and then bill privately insured patients—and even uninsured patients—for the drug’s full list price, helping themselves to the difference as pure profit.
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Consequently, most prescriptions filled at contract pharmacies are dispensed to patients who have prescription drug insurance—not to uninsured or financially needy patients.[7] That’s why Medicare and other third-party payers end up being responsible for the balance of the profit earned by a 340B covered entity and the contract pharmacy. In the real world, this is called stealing.
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​The 340B Drug Pricing Program is now the second-largest government pharmaceutical program, based on net drug spending. But unlike such programs as Medicare Part D and Medicaid, 340B lacks a regulatory infrastructure, well-developed administrative controls, and clear legislation to guide the program.
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For 2021, discounted purchases under the 340B program reached a record $43.9 billion—an astonishing $5.9 billion (+15.6%) higher than its 2020 counterpart. Hospitals accounted for 87% of these skyrocketing 340B purchases.[4]
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Astounding Growth
The chart below documents the 340B program’s exponential growth.​​
The evidence.
Over the years, government agencies, financial analysts patient advocates and watch-dog organizations have produced numerous reports that detail the extensive corporate fraud in the 340 B program. We've assembled them for your convenience. Please click on any of the images below to read the full document.
Growing Abuse in the 340B Program
"The 340B program has gotten off track in recent years because ... covered entities can prescribe the discounted medicines purchased through the 340B program to anyone who receives medical care at their facilities, including patients who have insurance and pay full price for the medicines..."
U.S. Government Accountability Office
'HRSA’s Processes Do Not Provide Reasonable Assurance That Participating Nongovernmental Hospitals Meet 340B Program Eligibility Criteria.'
State Treasurer of North Carolina
"Instead of using their discounts to benefit vulnerable communities, 340B hospitals expanded into wealthier neighborhoods with a higher percentage of insured individuals who could pay more for the drugs."
Citizens Against Government Waste
"Reports of abuse abound."
In the News.
Click on images below to read media accounts of the massive 340b scam.
(some articles may require a subscription)
Our Agenda.
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​1. Strengthen Oversight: We urge lawmakers to implement stringent oversight measures to ensure that the 340B program is not exploited for profit, but instead serves the patients who need it most.
2. Restore Original Intent: The 340B program should remain focused on supporting safety-net providers and enhancing access to affordable medications for low-income individuals, rather than allowing hospitals to profit at the expense of those they are meant to serve.
3. Increase Transparency: We call for greater transparency in 340B drug pricing and usage, requiring hospitals to publicly disclose how they utilize the savings generated by the program.
4. Address Fraud and Abuse: Lawmakers must take decisive action to investigate and hold accountable those who engage in fraudulent practices within the 340B program, ensuring that the system remains fair and effective.
The 340B program is a lifeline for millions of Americans who rely on affordable medications. It’s time to act to protect this essential healthcare resource from those who would exploit it for their gain. We stand together to demand that our lawmakers prioritize the integrity of the 340B program and restore it to its original mission of serving those in need.