I had the opportunity to attend a Congressional briefing on Capitol Hill on the Post-Election Outlook on Hospitals and the 340B Program. This briefing was coordinated by 340B Health, a membership organization that includes more than 1,200 hospital and health systems that participate in the federal 340B drug pricing program. The briefing included panelists that represented public, private, or non-profit hospitals that acted as safety net providers in their communities and was a discussion of how the 340B program enhances care for diverse patient populations and the future implications of adjustments to the program. The program, called 340B, was developed and implemented in 1992. The hallmark of the 340B program is a requirement that drug manufacturers sell pharmaceuticals at an approximate 20 to 50% discount to specific institutions. For the most part, 340B eligible clinics, hospitals, and health systems treat low-income or uninsured patients. A notable participant of the 340B program is the Veterans Health Administration.
The briefing was moderated by Maureen Testoni, Senior Vice President and General Counsel of 340B, and the panelists included representatives from the University of Rochester Medical Center, Setton Family of Hospitals, Unity Point Heath, and Sutter Health. The panelists all represented health systems that are comprised of hospitals in their network that are classified as Disproportionate Share Hospitals (DSH). The panelists all provided anecdotes and statistics about their specific relationship with the 340B program. A common thread amongst the panelists was the recognition of the program’s necessity to act as safety net providers. In comparison non-340B hospitals, 340B DSH hospitals provide more uncompensated care services. Even though 340B hospital account for only 36% of Medicare acute hospitals, they provide for 60% of all uncompensated care. While there are no guidelines with regard to how hospitals utilize the savings from the program, most institutions use them to provide uncompensated care, which are services provided without compensation often in the form of charity or at risk of debt. The population of patients that receive uncompensated care are the chronically uninsured and under-insured including patients on Medicare and Medicaid.
The panelists all addressed the importance of the 340B program in their ability to provide this form of charity care stating statistics that 340B hospitals often provide 60-80% of uncompensated care in their regions. In addition to this, 340B DSH hospitals treat and provide services to more low-income patients in comparison to non-340B hospitals; low income patients make up 26% of population of non-340B hospitals compared to the 42.5% in 340B hospitals. A notable argument brought up by the panelists is that there is a fundamental mismatch between the pharmaceutical industry and the hospitals; the pharmaceutical industry does not want to continue providing these discounts, while the hospitals say they cannot continue providing safety net services without them. While the presentation provided compelling stories of how the 340B program is essential in fortifying the ability of their respective centers to act as safety net providers, there was little discussion about the detailed mechanics and the potential vulnerabilities of the 340B program. This briefing served as a great preliminary introduction to the 340B program for me and has, indeed, sparked my interest into learning more about the different intricacies.
The briefing was moderated by Maureen Testoni, Senior Vice President and General Counsel of 340B, and the panelists included representatives from the University of Rochester Medical Center, Setton Family of Hospitals, Unity Point Heath, and Sutter Health. The panelists all represented health systems that are comprised of hospitals in their network that are classified as Disproportionate Share Hospitals (DSH). The panelists all provided anecdotes and statistics about their specific relationship with the 340B program. A common thread amongst the panelists was the recognition of the program’s necessity to act as safety net providers. In comparison non-340B hospitals, 340B DSH hospitals provide more uncompensated care services. Even though 340B hospital account for only 36% of Medicare acute hospitals, they provide for 60% of all uncompensated care. While there are no guidelines with regard to how hospitals utilize the savings from the program, most institutions use them to provide uncompensated care, which are services provided without compensation often in the form of charity or at risk of debt. The population of patients that receive uncompensated care are the chronically uninsured and under-insured including patients on Medicare and Medicaid.
The panelists all addressed the importance of the 340B program in their ability to provide this form of charity care stating statistics that 340B hospitals often provide 60-80% of uncompensated care in their regions. In addition to this, 340B DSH hospitals treat and provide services to more low-income patients in comparison to non-340B hospitals; low income patients make up 26% of population of non-340B hospitals compared to the 42.5% in 340B hospitals. A notable argument brought up by the panelists is that there is a fundamental mismatch between the pharmaceutical industry and the hospitals; the pharmaceutical industry does not want to continue providing these discounts, while the hospitals say they cannot continue providing safety net services without them. While the presentation provided compelling stories of how the 340B program is essential in fortifying the ability of their respective centers to act as safety net providers, there was little discussion about the detailed mechanics and the potential vulnerabilities of the 340B program. This briefing served as a great preliminary introduction to the 340B program for me and has, indeed, sparked my interest into learning more about the different intricacies.