This past Tuesday was the big day for the 340B Drug Pricing Program on Capitol Hill. Stakeholders for this vital program lined up early to get a seat at the House Energy and Commerce Subcommittee on Health hearing billed as an examination of 340B.
The hearing was originally scheduled a couple of weeks ago, but a late-season snow pushed it back. The postponement only allowed anxiety to build as stakeholders wondered why the hearing was seemingly called out of the blue, and what or who could be behind it. More than 30 organizations, including America’s Essential Hospitals, submitted statements, letters, and other documents for the hearing record.
Surprising Support on Both Sides of the Aisle
Uncertain of what to expect, I prepared for the worst, but hoped for a relatively neutral discussion. A neutral discussion was, for the most part, what I got.
It was no secret that members of Congress and agencies tasked with looking closely at federal programs like 340B – the Government Accountability Office and the Office of the Inspector General – want to see increased transparency, oversight, and accountability in the program. I expected members to be somewhat critical of Health Resources and Services Administration (HRSA) oversight of the program. I also expected disappointment with audit and report findings, and an overarching call for improvement. However, I was surprised that overwhelmingly, on both sides of the aisle, members seemed to support 340B and want it to work as intended.
Still, Issues Remain
There was discussion of these hot button issues:
- clarity on the definition of a patient, currently undefined under 340B
- hospital eligibility, particularly for DSH hospitals and hospitals that provide a significant amount of charity care
- transparency in how 340B covered entities use program savings
- ensuring accountability for covered entities
- recent growth in the program
Major critics of the program – there seemed to be only two or three at the hearing – were concerned with hospitals making “profits” by participating in 340B and whether participating hospitals were actually providing a disproportionate amount of charity care compared with hospitals that do not participate in the program.
Some members of the House panel were frustrated with the slow turnaround time for HRSA to bolster auditing and accountability requirements, as well as the little authority that the agency has over the program altogether. HRSA intended to issue regulatory guidance last year addressing most of the concerns raised about the program, but was stifled when a U.S. District Court ruled that the agency does not have rulemaking authority on the issues. HRSA instead plans to release non-binding guidance this summer to address concerns, such as patient definition, hospital eligibility, and contract pharmacies. Legislative action would be required for HRSA to develop binding 340B rules, which although not stated at the hearing, could be of interest to members of Congress and 340B stakeholders.
Cautiously Moving Forward
Overall, the hearing that raised eyebrows throughout our community of essential hospitals was not as rough as it could have been. There was no discussion of dismantling 340B as we know it. Will lawmakers take action to make changes to the program down the road? Maybe. Should we remain cautious? Absolutely. For now, most members of Congress seem to want only to gather information, improve the program so it continues to support their constituents, and see better program oversight, clarity, and accountability. What federal program couldn’t benefit from those things?