House Republicans' new 340B bill 'a pharmaceutical industry wish list,' hospitals say

Republican lawmakers in the House have introduced a bill Tuesday that tightens eligibility and public reporting requirements within the 340B Drug Discount Program, earning the applause of industry groups that argue the 1992 safety net program has swelled beyond its original intent.

The 340B Affording Care for Communities and Ensuring a Strong Safety-Net Act (340B ACCESS Act) would “restore integrity” to the controversial program and “uphold its original mission of providing affordable medications to those who need them most,” Rep. Larry Buchson, M.D. (R-Indiana), said in a statement.

Buddy Carter (R-Georgia) and Diana Harshbarger (R-Tennessee) joined Buchson in introducing the bill.

About a third of the country’s hospitals participate in the 340B program, which requires manufacturer discounts on most drugs administered in the outpatient setting to help safety-net providers. Data from the Health Resources and Services Administration suggest that discounted drugs purchased wholesale under the program grew 22% to almost $54 billion from 2021 to 2022 alone.

The 340B ACCESS Act would bring new hospital eligibility requirements that vary from hospital type to hospital type, which advocates said include greater flexibilities for rural providers like Critical Access Hospitals.

It also codifies definitions of 340B patients and contract pharmacies — a move that speaks to recent years’ legal battles between hospitals, pharmacies and the federal government over which patients are eligible for discounts and whether manufacturers must offer the discounts to contracted pharmacies. Those definitions would come with rules that the lawmakers say will bind providers and drug manufacturers alike to the program’s stated intent.

To ensure that low-income and underinsured patients are benefiting from the discounts, the bill comes with transparency requirements tasking grantee organizations with reporting how they are using their savings from the discounts.

The patients themselves will, regardless of dispensing site, also become eligible for reduced medication copayments. Hospitals, meanwhile, would be prohibited from denying 340B patients access to the medications based on their ability to pay and chasing down the patients for medical debt payments, alongside other minimum charity care spending requirements.

Thomas Johnson, executive director of the Alliance to Save America’s 340B Program, a coalition of industry groups that includes those representing pharmaceutical manufacturers and community health centers, applauded the bill.

“This program, which was originally meant to help those who are underserved, lacked the clarity and predictability that all stakeholders need to help improve outcomes for vulnerable patients,” Johnson said in a statement. “Today, we are pleased to see the introduction of the 340B ACCESS Act because it embodies the clear and comprehensive approach to reform that our coalition has been advocating for. Most importantly, this legislation ensures patients in underserved communities directly benefit from the program.”


Hospitals gave the bill a frigid reception. Maureen Testoni, president and CEO of 340B Health, the association representing over 1,500 hospitals participating in the 340B program, said the bill reads as “the legislative version of a pharmaceutical industry wish list” and would ultimately decrease the number of patients eligible for discounts.

“Drug companies already have imposed unilateral restrictions on 340B that have harmed patient access to care,” she said in a statement. “Now the industry wants to enlist Congress in slashing eligibility for 340B, dialing back its responsibilities to support the health care safety net, and boosting its profit margins even more."

There’s been no shortage of interest in 340B reform among legislators in recent months, though not always with the same intent as this week’s bill.

Earlier this year a bipartisan working group in the Senate put out the call for input on a legislative discussion draft tackling “stability and transparency” in the program. Due to prior received comments and recent court rulings, the senators said they were particularly interested in more insight on patient definition, child sites and contract pharmacy arrangements.

Additionally, March saw the introduction of the 340B PATIENTS Act by Rep. Doris Matsui (D-California). That bill, which is supported by 340B hospitals, would also codify providers’ use of contract pharmacies but penalize drug manufacturers that restrict their discounts to these or other sites.

Darbin Wofford, senior health policy advisor for Third Way, said the center-left think tank was “pleased” by the introduction of this week’s bill and called for Democratic lawmakers and others to meet House Republicans on the broader issue of 340B program bloat.

“This bill comes at a time where 340B is under increased scrutiny on Capitol Hill,” Wofford told Fierce Healthcare in an emailed statement. “It is clear hospitals are not meeting the mark on how they are using the program and the 340B ACCESS Act would make much needed changes to how hospitals operate the program. We hope it gains bipartisan support in the future, and that it adds to the conversation going on in the Senate Bipartisan Working Group.”