340B hospital profit study is flawed, hospital groups say

Hospital groups are pushing back against new research claiming that hospitals are profiting from a drug-discount program meant to help low-income and uninsured patients afford their medications.

The study of the federal 340B program, published  in Health Affairs, found that hospital-affiliated clinics registered with the program over the last 10 years served wealthier communities with higher rates of insured patients than hospitals and clinics participating in the program before 2004. The researchers concluded the 340B program "is being converted from one that serves vulnerable patient populations to one that enriches hospitals and their affiliated clinics."

But hospital advocates argued the National Cancer Institute-funded research didn't account for other factors that are prompting safety-net hospitals to open clinics in wealthier suburban areas, according to the Healthcare Financial Management Association (HFMA). It also didn't measure the income of clinic patients versus the community as a whole, potentially missing "pockets of poverty" in those communities, noted the Safety Net Hospitals for Pharmaceutical Access (SNHPA).

"The fact remains that 340B (disproportionate share) hospitals support heavy caseloads of Medicaid and low-income Medicare patients--regardless of where their outpatient clinics are located," two senior SNHPA leaders wrote in their article, which cited several other factors they said discounted the study's findings.

"Savings from the program are essential in helpings all safety-net hospitals treat vulnerable populations."

SNHPA organized to advocate for the program, launching a website last year, 340Bfacts.com, and releasing a white paper trying to drum up support.

The American Hospital Association contended in a blog post that the study ignored how an expansion of the 340B program in 2004 affected the program. It also argued that the main reason the reported number of hospital-based 340B clinics grew was a new reporting system.

To learn more:
- here's the HFMA article
- check out the SNHPA article
- read the AHA Stat blog post