Millions of Floridians can pick an insurance plan this enrollment period with the peace of mind that federal law defends their health care rights. Floridians also know that their state legislators have worked diligently to defend them from harmful practices like step therapy and the unnecessary burden of prior authorizations. But what about those Floridians — many of them elderly — who are still falling through the gaps in our health care system?
Congress created a safety net drug pricing program for Medicaid patients and the uninsured, but the results tell us this safety net is failing, exacerbating unfair drug pricing for Floridians. To date, Congress has failed to act to contain the cost of the 340B program that is meant to protect the most vulnerable patients in our state. At a moment where our nation is looking inward to improve prescription drug access, lawmakers and regulators should look no further than the second-largest federal drug pricing program in the country to defend patients from escalating medication costs and give them greater peace of mind about their health care.
The 340B Drug Pricing Program was created by Congress to stretch limited resources and help Medicaid and uninsured patients access life-saving health care. The program requires drug manufacturers to sell their medications to certain eligible hospitals and other covered entities at significantly discounted prices to help these hospitals serve a greater number of vulnerable patients, including seniors and children in need of discounted care.
Hospitals and clinics qualify for the 340B program by serving a federally pre-determined percentage of low-income or uninsured patients, which in Florida amounts to millions of patients today.
Qualifying hospitals and clinics are then able to purchase prescription drugs at significantly discounted prices from manufacturers, the savings from which are intended to be passed on to patients to help them access their care. This is great intent. But the important question lies within real-world impact. How has that intent translated to value for patients?
Unfortunately, this program lacks any serious legal or regulatory oversight requiring health care entities to pass savings on to patients or report transparently on those efforts. As a result, 340B-eligible hospitals and clinics can simply pocket the savings from discounts while patients can end up paying full price for their medication or care.
This oversight is only the tip of the iceberg when it comes to the way the 340B program is currently operating. The meteoric growth of the program over the last decade — to the tune of 400% — can be attributed to vague guidelines, considerable disparities in how participating entities interpret and navigate the program, and inadequate transparency. This combination of factors has allowed what some have referred to as bad actor hospitals, clinics, pharmacy benefit managers and health insurers to take advantage of the program to bolster profit margins without demonstrating a decrease in patient out-of-pocket costs for needed medicines.
In Florida alone, community health centers — which are a crucial source of care for low-income and uninsured patients — are facing the possibility of a more than $100 million loss if these loopholes are not addressed and pharmacy benefit managers, insurance companies, and pharmaceutical companies are allowed to continue increasing costs for the program while undermining its intent.
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Simply put, the 340B program has managed to escape significant scrutiny and as a result, has failed to deliver results for patients. If Congress and state policymakers are committed to ensuring safety net health care programs are truly increasing patient access to affordable care, they must bring necessary oversight and transparency to 340B. Without these guardrails, seniors, families, and children who rely on the program will continue to fall victim to an already flawed health care system. Florida’s patients and seniors deserve better.
Brian Nyquist is the Executive Director of the Infusion Access Foundation (IAF), a non-profit advocacy group working to ensure patients have access to provider-administered therapy for any and all complex illnesses.