Why the 340B Drug Discount Program Must Survive


Cynthia Holstein, CEO - Shawnee Family Health Center



Big Pharma has launched a stealth assault on a drug discount program low-income patients depend on for life-saving medicines. The 340B program was created by Congress in the 1990s to give safety-net providers, such as Shawnee Family Health Center and Compass Community Health access to reduced pricing they could not negotiate on their own. Republicans and Democrats alike support the program because it stretches scarce federal resources as far as possible for the common good. Nothing is wasted. The 340B program at Shawnee Family Health Center enables the organization to provide free and low-cost medications for eligible patients. Services, such as transportation, can be provided thanks to the 340B program and the Center can maintain enough staff to help people in our community access physical and mental health care that is affordable.

The patients that benefit from the 340B program typically suffer from a high incidence of chronic disease, live in poverty, and lack insurance or are under-insured. Our patients include people with severe and persistent mental illness, veterans, children, elderly, and people that have lost their jobs and health insurance. Obtaining needed medication is not obtainable to many people due to the cost of medications. A pandemic would seem the worst possible time to threaten a critical program that makes medicines affordable for the poor. Yet, a lack of regulatory safeguards has created a climate that is ripe for destruction. The elimination of the 340B programs would eliminate transportation and other services that are supported by the savings of this program. High-cost medications could not be provided forcing people to go without.

Pharmaceutical manufacturers are utilizing a “death by a thousand cuts” approach to dismantle and weaken 340B discounts. Pharma’s range of tactics include imposing arbitrary reporting requirements even though health centers already comply with strict reporting standards Some drug makers are also taking measures to restrict how 340B providers can contract with pharmacies.

Compounding the problem are third-party compliance vendors and pharmacy benefit managers intent on pocketing profits that could be used to improve patient outcomes. A White House Drug Pricing Executive Order (EO) recently issued is the latest blow. The EO aims to lower out-of-pocket costs health center patients pay for Epipens and insulin, but it would have the opposite effect. Many patients will end up paying more for drugs and it would impose administrative burdens for both providers and patients. The 340B program at Shawnee gave us the ability to help a man with diabetes obtain needed medication for $22.00 per month rather than $500 per month .

Drug manufacturers will claim reigning in 340B discounts falls under the mantle of ensuring fiscal integrity. Yet, health centers have proven to be excellent stewards of tax dollars and 340B discounts. Health centers are nonprofits, accountable, and driven by mission- not money. They do not have the billions of dollars drug companies have and must stretch their resources as much as possible to achieve their mission of caring for people. This program needs to be protected so that community health centers can continue to provide needed care and medications to those without to pay for healthcare. Let’s urge our congressmen Wenstrup and Johnson to vote to approve the Protect 340B Act (HR4390)

Cynthia Holstein, CEO

Shawnee Family Health Center

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Please submit comments and Letters to the Editor to [email protected] for publishing consideration by our editorial board.