Protecting the 340B Program Vital for Providing the Best Care to Patients With HIV

The 340B Drug Pricing Program was first created in 1992 to protect hospitals in safety-net areas from the increasing prices of drugs. Experts working in clinics that benefit from the 340B Program have emphasized how important the program is for them to continue their work in providing health care to patients of vulnerable populations, including patients with HIV, due to the funding that it provides for them to maintain the clinic services.

In February 2024, 6 senators, both Republican and Democrat, released a draft bill titled "Supporting Underserved and Strengthening Transparency, Accountability, and Integrity Now and for the Future of 340B Act" (SUSTAIN 340B Act) with an aim of codifying the functions of the 340B program into federal law.¹

The draft discussion was released in an attempt to foster discourse on the topic of the 340B program and to ensure that those who worked with the program the most had a say in how the SUSTAIN 340B Act took form. With the 340B program so important to the care of patients with HIV, both in providing primary care as well as allowing patients with HIV a place to pick up their medication in a place that they feel safe, it is vital to codify the program's intention and services across the country.

What is the 340B Program?

The 340B Drug Pricing Program refers to section 340B of the Public Health Service Act, which requires pharmaceutical manufacturers that participate in Medicaid to sell outpatient drugs at discounted prices to certain health care organizations, including federal grantee organizations and several types of hospitals.² These health care organizations must be those that serve large proportions of patients that are uninsured and/or low-income.

Waiting area in a clinic | Image credit: concept w - stock.adobe.com

The 340B Program has faced some scrutiny in recent years, as some experts have claimed that the program actually costs more than it helps. According to an interview published on AJMC.com with Kimberly Westrich, MA, from the National Pharmaceutical Council, the 340B program is costing employers and their workers upwards of $5.2 billion due to the lost rebates for products purchased under the program.³ The benefit to the safety-net hospitals has also been called into question, with previous research suggesting that reform to the functions of the 340B program are needed for it to work as intended.

However, other experts that work in the clinical space insist that this isn't the case and that the benefits outweigh the potential negatives.

“It doesn’t actually use or invest federal tax dollar money, it’s not a grant program or anything like that,” said Bill Keeton, chief advocacy officer at Vivent Health. “It’s really designed to help clinics…ensure that we are able to deliver comprehensive care to some of the nation’s most vulnerable individuals.”

For Keeton and Emily Blaiklock, vice president of pharmacy at Positive Impact Health Centers, this program especially helps them care for patients that are living with or are vulnerable to HIV in the United States. Keeton explained that the program is designed to stretch funding as far as possible to provide comprehensive care for patients; in his case, patients with HIV. Clinics that benefit from the 340B program include Ryan White Clinics, federally qualified health centers, community health centers, and disproportionate share hospitals.

Blaiklock noted that this federal funding is especially vital in HIV care and specifically for Ryan White Clinics. “[The Ryan White patient data report from 2021] states the US saw 18.4% increase in medical care costs due to inflation from the year 2015 to 2021,” she said.⁴ “However, Ryan White funding remained stagnant…Ryan White clinics were able to utilize 340B program savings to offset these raising costs. It actually provided care to an additional 43,000 individuals living with HIV.”

The 340B program offers health care organizations the ability to buy medications at a significantly reduced cost while billing insurers for market price, allowing for “savings” that are obligated to be reinvested into treatment and care programs. “We can also turn around and provide those drugs then at free or no cost or little cost to the folks who we are serving,” said Keeton. “So at the end of the day, the 340B program is designed to make sure that there is sustainability and financial stability within the safety net.”

When it comes to HIV care, Blaiklock said that the funding doesn’t just cover a specific thing or program, such as the food pantry or dental care, but rather all of their services are helped through the 340B program. “Because of the way that we utilize the savings by reinvesting in items that are already eligible on our grants…not only would [reducing funds mean] less people being seen, and so inhibits growth of trying to deal with the national epidemic, but also it inhibits just the general holistic approach to care,” she said.

Keeton noted that with the longer life span of patients with HIV, health care needs for patients have changed within the past 30 years. The 340B program allows for providers in clinics to treat all aspects of conditions, including diabetes and hypertension, making it an important funding program to making sure all patients receive holistic care, from medical care to housing care to making sure that the patient has enough food each night.

Proposed SUSTAIN 340B Act and How to Protect the 340B Program

The SUSTAIN 340B Act was brought to congress by Senators John Thune (R-SD), Debbie Stabenow (D-MI), Shelley Moore Capito (R-WV), Tammy Baldwin (D-WI), Jerry Moran (R-KS), and Ben Cardin (D-MD).¹ The act was written with the intent of ensuring covered entities will benefit from the 340B Program in the future. It also proposes codification of the original intent of the program, which is to stretch resources in order to provide high-quality care to underserved communities.

The draft legislation invited stakeholders to weigh in on what the best language for the act would be and even asked for proposed definitions of “contract pharmacy” and “patient” as to not discriminate or inadvertently leave out certain individuals from receiving care. The Ryan White Clinic, for their part, released a statement⁵ in April 2024 after the draft was published to highlight areas of concern and language that needed to be improved before the act could proceed. This included warning against narrowly defined limits to the 340B program, requesting that the intent of the program remain the same, and noting that reporting that is burdensome to the employees of the clinic and could affect the care that patients receive.

“By and large, a lot of what’s included in the SUSTAIN Act is going to help covered entities like ours continue to deliver the care and treatment that folks need,” said Keeton.

However, there are concerns about how best to represent what the 340B Program does in legislation, as there is a lot to juggle in terms of making sure that all parts of the program are working as was intended when the program was created. With the 340B program, there are 3 parts that have to work together to give care to the patient. This includes the providers, the pharmacy, and the payers. Keeton noted that providers have been having difficulty with discriminatory reimbursement.

“[Discriminatory reimbursement] is when an insurer or their [pharmacy benefit manager] (PBM) identifies our clinics as a 340B provider and reimburses us at a lower rate,” said Keeton. “That kind of just works exactly against the intent of the program. When Congress created it, the intent of Congress was to make sure that the savings…are supposed to go into patient care.”

Blaiklock noted that payer contracts often ask whether the clinic that she works at is operated by a 340B entity, which can often affect the funding of the clinic. “To me, saying yes on that is just saying you now know that I purchase medications less than a normal retail pharmacy. And the only reason you would ask that is if you are planning on reimbursing me lower because I can still operate with a lower margin,” she explained. “But that margin of benefit, those lower drug costs, is not to pad the pockets of the pharmacy operations.”

State-level protections against discriminatory reimbursement have worked in the past, said Blaiklock. Protecting the integrity of the program at both the state and federal level should be a priority when looking to address the discriminatory practices, such as excluding clinics from participating in a pharmacy services administrative organization. “I understand that these are all cost-saving mechanisms that payers are using to go back into their plans, but the intent of the program was for this saving mechanism to go back into these specific safety net programs,” she said.

Patients with HIV being able to get their HIV medication in the pharmacy that is on site where they get their care is also a major point of concern, and both noted the ease with which patients can get their questions by both their doctor and the pharmacist when the pharmacy is on site. Moreover, these patients can get a modicum of privacy when it comes to picking their prescription up as opposed to a family member or friend learning about their diagnosis through the medications arriving through the mail. This makes it an important aspect to cover in the SUSTAIN 340B Act.

Keeton noted that there is also a lack of a definition for a patient included in the draft of the legislation. “It’s really important for us that Congress not begin to define what a patient is just because of how the 340B statute operates,” he said.

Transparency, he said, is also important. However, Keeton noted that proposed changes in reporting could be troublesome, as reporting is already a requirement and the added administrative burden could affect the care provided to patients. Blaiklock also mentioned that ideas like the national clearinghouse proposed in the act sound great on paper to cut down on duplicate discounts but could be concerning if all claims are held to this rather than just claims specific to Medicaid.

Although these were some more broad concerns that have been voiced by clinics, there are still some more specific concerns about who it is that gets to be included in the rewriting of the legislation. In the view of some clinics, the involvement of certain entities, such as manufacturers, could do more harm than good for the 340B Program.

The Ryan White Clinic specifically requested that manufacturers be left out of the discussion when it comes to what the 340B Program does and how it would be funded. Blaiklock said that including manufacturers, who are required to offer a discount on medicine to the covered entities of the 340B program to provide them funds, could be a problem in future discussions. “To have the people that are funding then decide on how to operate it and to provide oversight of it as a federal program, it seems like it would not be helpful to the intent overall to expand and support the safety net in a holistic way,” she said.

She also noted that the comments and proposed changes that were coming from pharmaceutical companies focused primarily on limiting the scope of the program and on earning more money on their end. “It’s really important to us that they’re not a leader in the space of coming up with the appropriate oversight and intent of the program as it was originally designed.”

Being able to create a network and system of care for all patients is a core part of the 340B Program, said Keeton. This, he said, is why the savings generated by patients with insurance are given instead to the clinics rather than the patients who already have means of covering their medications. “When somebody walks into a pharmacy like [Blaiklock’s] or mine and can’t afford their medication, they walk out of our clinics with every medication that they need to manage their health,” he said. “It’s important to peel that onion layer back and say, 'What does the money in the 340B program on the provider side really do?'”

Keeton also pointed out that reining in eligibility requirements may be somewhat short-sighted, as the amount of patients with HIV who are vulnerable to health care deserts is not getting any smaller as the years progress. “We’ve got a growing number of people every year. There’s 1.2 million people living with HIV in the United States. Every year, about 15,000 people living with HIV pass away and we still see 25,000 to 35,000 new infections every year. That number is just always going to be getting bigger,” he said.

These concerns are important to consider when future drafts of the legislation are written. But is there a timeline for these changes? Or will other legislation come forward that better encompasses the needs of the clinics across the country?

Although there are some issues with the draft legislature as it stands, Blaiklock appreciated that there was work being done to not only draft this legislature but also collaborate on it.

“We appreciate the effort, the conversation that we were invited to, and the listening session that we were a part of. We want to be a part of the conversation,” she said. “I don’t think it’s perfect, but I think it’s something that we take seriously. It seems like a serious piece of proposed legislation that we appreciate the starting point and want to be at the table to collaborate.”

The Future of 340B: Legislation and Protection

A major part of clinics using the 340B program is their ability to better treat patients with HIV. According to Keeton, both his and Blaiklock’s clinics boast a 95% rate of viral suppression in their patients with HIV, which speaks to the efficacy of clinics within the 340B program. Protection of the program is something that both Blaiklock and Keeton pointed to as a vital step as more legislation and updates to draft legislation are written. The question remains about the timeline of such moves.

Keeton said that his and Blaiklock’s organizations took the opportunity to respond with comments about the SUSTAIN 340B Act when the ability presented itself. “I don’t want to say we’re waiting with bated breath, but we’re anxiously anticipating—hopefully sometime soon—the response to that [request for information] in terms of how that’s going to be incorporated into the draft coming out,” he said.

Although no specific timeline has been released to the public on when to expect such an update of the legislature, other Representatives in the House have introduced alternative legislature to codify the functions of the 340B program. The first was introduced on May 28, 2024 by 3 Republican Representatives, Larry Bucshon (R-IN), Buddy Carter (R-GA), and Diana Harshbarger (R-TN). The bill was titled the 340B ACCESS Act.⁶ According to Keeton, the legislature was introduced with the support of the ASAP 340B national alliance, a coalition of different stakeholders in the space that includes the pharmaceutical manufacturers lobby.

“We do have some substantive and significant concerns with that legislation as it’s been drafted and introduced,” said Keeton. “I will say that there are some things about it that we certainly want to look further into and explore. But there are not insignificant challenges associated with that.”

Similar legislation, the 340B PATIENTS Act, was introduced by Doris Matsui (D-CA).⁷ This legislation would help to codify clinics’ ability to use contract pharmacies to give discounted drugs to patients, which would allow patients in the 340B program to pick up their prescriptions from any local pharmacy and would allow providers use of their 340B savings to expand medical and social services. Keeton and Blaiklock said that they were more supportive of this bill.

“Even though [these bills have] been introduced, it seems like kind of a standstill and we’re all playing a waiting game right now,” said Blaiklock. “There’s definitely ones that we feel like are more legitimate and that we’re willing to come to the table and have these conversations [and] that there is an ability to have movement and discussion. And there’s some that we feel like, where do we start trying to come to a happy medium?"

Blaiklock said having discussions about the importance of the program is important in making sure that policymakers and other patients understand how much the 340B program does for patients with HIV daily. Telling the patients that they have access to different forms of care, such as pharmacy partners and behavioral health services, due to the savings on prescription drugs can help patients and legislators to grasp the scope of the program.

“We strongly oppose any attempt to restrict the reach of the 340B program,” said Blaiklock. “Any restrictions erode impact, they endanger health outcomes, and taxpayers will pay all pharmacy [while] pharma will profit. And that’s the main concern with any of this proposed legislation and really what we’re working to combat and support in our area for improved patient care.”

References

1. Cook EJ. The SUSTAIN 340B Act: a summary and guide for reviewing and providing comments. MWE. February 21, 2024. Accessed June 14, 2024. https://www.mwe.com/insights/the-sustain-340b-act-a-summary-and-guide-for-reviewing-and-providing-comments/
2. Fact sheet: the 340B drug pricing program. American Hospital Association. March 2023. Accessed June 14, 2024. https://www.aha.org/fact-sheets/fact-sheet-340b-drug-pricing-program
3. Steinzor P. Kimberly Westrich talks the hidden costs of 340B to employers. AJMC. May 7, 2024. Accessed June 20, 2024. https://www.ajmc.com/view/kimberly-westrich-talks-the-hidden-costs-of-340b-to-employers
4. RWC-340B study: value of Ryan White providers and impacts associated with resource reduction. Ryan White Clinics 340B for 340B Access. 2021. Accessed June 20, 2024. https://rwc340b.org/rwc-340b-key-research/
5. RWC-340B Letter to Senate 340B Working Group. Ryan White Clinics 340B for 340B Access. April 1, 2024. Accessed June 18, 2024. https://rwc340b.org/wp-content/uploads/2024/04/FINAL.-RWC-340B-Letter-to-Senate-340B-Working-Group.pdf
6. Carter, Buschon, and Harshbarger introduce legislation to ensure access and transparency in 340B drug pricing program. News Release. Buddy Carter; May 28, 2024. Accessed June 14, 2024. https://buddycarter.house.gov/news/documentsingle.aspx?DocumentID=11883
7. Matsui introduces legislation to protect 340B drug pricing program. News Release. Doris Matsui; March 12, 2024. Accessed June 14, 2024. https://matsui.house.gov/media/press-releases/matsui-introduces-legislation-protect-340b-drug-pricing-program