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Dr. Bucshon, Rep. Carter, and Rep. Harshbarger Introduce Legislation to Ensure Access and Transparency in 340B Drug Pricing Program

WASHINGTON – Today, U.S. Representatives Larry Bucshon, MD (R-IN-08), Buddy Carter (R-GA-01), and Diana Harshbarger (R-TN-01) introduced the 340B Affording Care for Communities and Ensuring a Strong Safety-Net Act (340B ACCESS Act). This legislation establishes critical oversight and transparency of the 340B program - while providing clear, practical, and achievable solutions to ensure the 340B program can be a force for good in the nation’s health care safety net.

"The 340B drug pricing program was originally created to serve as a lifeline for thousands of Hoosiers and millions of Americans who struggle to afford life-saving medications," said Dr. Bucshon. "However, in recent years the program has rapidly expanded, with a lack of transparency, clarity, and accountability threatening its future. As a physician, I know the importance of providing patients with reliable access to affordable medications. It's imperative that we address these concerns and safeguard the 340B drug pricing program, ensuring its benefits are reaching and helping vulnerable patients. I am proud to lead the 340B ACCESS Act, which seeks to restore integrity to the program, enhance transparency, and uphold its original mission of providing affordable medications to those who need them most."

“340B was intended to give low-income and vulnerable patients access affordable medicines. The program has rapidly expanded, and a lack of transparency has allowed some entities to pocket the savings without passing them on to patients.  Congress must act to restore the integrity of the program to better protect vulnerable patients served by safety-net providers.  The 340B ACCESS Act will save lives and improve outcomes by ensuring patient access to affordable, quality health care.  I want to thank Dr. Bucshon and Rep. Harshbarger for joining with me to protect the 340B drug pricing program for Georgians and all Americans.” said Rep. Carter.

“The 340B program is a vital resource for safety-net providers serving low-income and vulnerable patients, but current loopholes have allowed the benefits of discounted drug costs to be misused and siphoned off instead of helping disadvantaged patients afford their treatments,” said Rep. Harshbarger.  “As a pharmacist, I know first-hand the critical need for enhancing access to affordable medications and health care services. That’s why I’m proud to join Dr. Bucshon and Rep. Carter in introducing the 340B ACCESS Act, which will put in place much-needed reforms to protect and strengthen the 340B program for rural and safety-net providers, and the communities in Tennessee and across the country that rely on it.”

“Today is a great day for patients who depend on 340B to access affordable medicine and health care services. This bill will lower out-of-pocket prescription drug costs for up to 48 million uninsured and low-income patients nationwide — an unprecedented step for the program. It’s a commonsense reform, but one that has been sorely missing,” said Thomas Johnson, Executive Director of the Alliance to Save America’s 340B Program. “We commend Reps. Larry Bucshon, Buddy Carter, and Diana Harshbarger for listening to patients, providers, and stakeholders as they drafted this comprehensive and balanced solution that will bring clarity, transparency, and accountability to the second largest drug pricing program in the country. We urge all members of Congress to join them in supporting these much-needed reforms.”

“We applaud Representatives Bucshon, Carter, and Harshbarger for their leadership in developing this critical legislation that delivers on a solution to protect the purpose and sustainability of the 340B discount drug program. As the largest primary care network in the nation, Community Health Centers serve 1 in 11 Americans or over 31.5 million patients, 90 percent of whom are low-income and need timely access to affordable life-saving acute and chronic condition medicines,” said Kyu Rhee, MD, MPP, President and CEO of NACHC. “Protecting patient access to essential medications saves lives and keeps people healthy, including the 41 percent of health center patients who live in rural and frontier communities across our nation. We are grateful the legislation enshrines the important role of contract pharmacies in providing medicines near where patients live and work.  We look forward to working with leaders in Congress and ASAP 340B stakeholders to ensure passage of this landmark legislation.”

“The 340B program supports over 650,000 Hoosiers who depend on Community Health Centers. We are very pleased to see Congressman Larry Bucshon’s introduction of this legislation, a critical fix for the 340B program that puts underserved patients first and delivers long-overdue reform. This legislation could reduce out-of-pocket prescription costs for nearly 1 million uninsured and low-income Hoosiers. We are grateful for Congressman Larry Bucshon’s leadership on this issue and his commitment to setting 340B on the right course for the future.”  - Ben Harvey, Chief Executive Officer, Indiana Primary Health Care Association

The 340B drug pricing program, which was originally created in 1992, is an important tool that helps hospitals and other covered entities meet the healthcare needs of low-income and uninsured patients. It does so by allowing 340B covered entities to purchase drugs for patients of their facilities at substantial discounts.  However, over the past decade, the program has grown substantially and has operated with little transparency or oversight.

The 340B ACCESS Act seeks to capture the following policy principles which reflect the consensus of ASAP 340B members and will guide efforts to realign the 340B program in the interest of true safety-net providers and the communities they serve:

  • Make 340B a true safety-net program for patients.
  • Ensure 340B prescriptions are offered to patients at a discount.
  • Update the 340B patient definition with strong safeguards. 
  • Establish clear criteria for 340B contract pharmacy arrangements to improve access.
  • Prevent middlemen and for-profit entities from profiting off the 340B program.
  • Update and strengthen 340B hospital eligibility requirements.
  • Address standards for 340B child sites and subgrantee eligibility. 
  • Create a neutral 340B claims data clearinghouse.
  • Facilitate public reporting on 340B program data.
  • Establish enforceable rules and enhance federal administration and oversight of the 340B program.

In order to ensure 340B is reaching and helping vulnerable patients, the 340B ACCESS Act will:

Establish Patient Affordability Requirements 
New requirements would ensure that qualifying low income and uninsured patients benefit directly from 340B through reduced out-of-pocket costs for their medicines, whether they receive their medicine from a covered entity, child site, or contract pharmacy. Currently, the 340B program has no such patient affordability requirements for medicines, and evidence suggests that only a small share of 340B hospitals use some of their 340B margin to help patients afford their medicines.

Codify Patient Definition
The 340B statute expressly prohibits purchasing 340B drugs for individuals who are not patients of a covered entity, but the statute does not provide a detailed definition of a covered entity patient. In 1996, HRSA issued a definition of a 340B patient in guidance. That definition is overly broad and subject to abuse. For example, the guidance allows use of 340B drugs in cases when a provider “provides health care under contractual or other arrangements (e.g. referral for consultation)” but does not specify what constitutes a “referral” or “other arrangements.” Additionally, HRSA’s guidance has not specified a time period for which an individual remains a “patient” of a covered entity after first receiving care at the entity. The legislative text would codify a patient definition in statute. The elements of this definition would clarify which drugs could qualify for 340B discounts.

Recognize Contract Pharmacies 
Contract pharmacies would be recognized in statute and subject to rules aimed at ensuring covered entities use these arrangements consistent with the intent of the program as specified in the legislation. The legislation would add new requirements for manufacturers, who currently do not have a statutory requirement to ship or facilitate delivery of 340B drugs to contract pharmacies. 

Impose Hospital Eligibility
This legislation would establish eligibility requirements for hospitals, with specific requirements varying by hospital type. These requirements are intended to ensure that the program serves true safety net hospitals.

Establish Child Site Eligibility
The legislation establishes statutory standards for child site eligibility and requires covered entities to demonstrate to the HHS Secretary that each child site satisfies the new standards prior to participating in 340B. Covered entities would be required to de-register the child site from 340B and self-disclose any improper discounts if a child site fails to meet these new eligibility standards. Hospitals would be subject to civil monetary penalties if they fail to de-register the child site and self-disclose non-compliance with these standards. Currently, child sites have no eligibility requirements related to treating low-income and otherwise vulnerable patients or providing charity care.

Restrict PBMs and For-Profit Entities
Restrictions on pharmacy benefit managers (PBM), contract pharmacies, and third-party administrators are included in the legislation to guard against for-profit, 340B supply chain middlemen making excessive profits from a safety-net program. These new PBM non-discrimination rules are modeled after those in the Preserving Rules Ordered for the Entities Covered Through (PROTECT) 340B Act (H.R.2534).

Bolster Transparency
Last Spring, Dr. Bucshon introduced H.R. 3290 which would authorize the secretary of the Department of Health and Human Services to audit how covered entities use their 340B Drug Pricing Program savings, as well as require 340B hospitals to report comprehensive financial data. The legislation passed the House Energy and Commerce Health Subcommittee with a vote of 16-12 and was favorably reported, as amended, to the House by the full committee with a vote of 29-22.

The 340B ACCESS Act includes a transparency section that is based on Dr. Bucshon’s H.R. 3290 (as amended) that brings much-needed transparency to the 340B program.

The legislation adds a requirement that grantees report how they are using 340B margin using standardized rules established by HHS that are consistent with reporting requirements that federally qualified health centers use for Uniform Data System (UDS) reporting.

Flashpoint: Strengthening Safety Net for Underserved Communities  
New 340B Transparency Bill to be Discussed Next Week in House Hearing, U.S. Senate Bills Introduced
340B Drug Program was Created to Help Patients, not Boost Hospital Profits