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Rural Providers Show Support for 340B in Drug Pricing Blueprint

Analysis  |  By Jack O'Brien  
   July 17, 2018

On the final day for public comment on the Trump administration's blueprint to lower prescription drug prices, rural providers and advocates reiterated their support for the drug pricing program.

Rural health providers and advocates for the 340B Drug Pricing Program issued their support for the federal 340B Drug Pricing Program by Monday, the final day for public comment on the "HHS Blueprint to Lower Drug Prices and Reduce Out-of-Pocket Costs."

While the overall prescription drug pricing plan elicited more than 2,000 responses, the 340B program component generated about two dozen comments from rural health systems, disproportionate-share hospitals (DSH), and 340B Health, a leading advocate for the program on Capitol Hill.

The final day for comment came about one week after Health and Human Services Secretary Alex Azar addressed a 340B conference about the future of the program, urging improved oversight and accountability measures.  

Related: 3 Takeaways From Azar's 'Frank' Speech at 340B Conference

Related: Pfizer Backs Down From Drug Price Hike After Trump's Twitter Lashing

Attendees gave the speech a chilly reception, due in large part to the administration's cuts to the program and proposed delays to several final rules, which have left some systems hamstrung.

340B Health's public comments on the drug pricing plan focused on the services provided by the program, arguing that it "helps preserve the health care safety net" and does not contribute to manufacturer's high set list prices. 

"To the extent that drug companies pay additional rebates over the statutory 340B discount for drugs that have been dispensed to 340B patients with commercial insurance, those are the result of business decisions made by manufacturers," Maureen Testoni, interim CEO of 340B Health, wrote in their comment. "Manufacturers voluntarily enter agreements with commercial insurers to pay rebates in exchange for the companies’ drugs being placed on the insurers’ formularies.

Rapid City Regional Health in South Dakota also commented on the blueprint, stating that it utilizes the program to offset $57 million in annual uncompensated care costs. 

"The 340B program is vital to RCH's community-focused mission of providing healthcare services to low-income, uninsured and underinsured patients," Michael Diedrich, Vice President of Government Relations, wrote in their comment

Related: Rapid City Regional Health Losing $1 Million a Week

Below are comments from rural providers expressing support for the program as the administration looks to curb prescription drug costs. 

  • Wickenburg Community Hospital in Arizona, Boone County Hospital in Iowa, as well as Ridgecrest Regional Hospital and Oroville Hospital in California submitted comments which mirrored the language in 340B Health's submission, calling on the administration to lower list prices, avoid duplicate discount prices, and clarify program eligibility.
  • Delta County Memorial Hospital in Colorado wrote: "The insinuation that drug prices rise because of the 340B Program is false. Prices rise because of consolidation in the drug industry, single source drugs, drug shortages, market control through specialty pharmacies, limited distributions networks, collusion with insurance carriers, and downright greed."
  • "As our prices rise and reimbursement falls, rural healthcare delivery becomes impossible without the 340B Program," Delta County Memorial added. 
  • The Georgia Department of Public Health wrote that the 340B program is "crucial" to their operations and accounts for only 1.3% of total U.S. drug sales. 
  • SSM Health, a Catholic system with business in four states, said it received $75 million from the 340B program in 2016. "Without the 340B Program, we would be unable to provide access to critical health care services for those in need."
  • "Far from contributing to higher drug prices, the 340B program has been a critical tool for our hospital to continue to care for our community," Mick Zdeblick, CEO of Asante Rogue Regional Medical Center in Oregon, wrote. "If the 340B program is curtailed, it will be our patients and the broader community we serve who will pay the price through more limited access to needed services."
  • Piedmont Health Services in North Carolina wrote that more than 40% of its patients are uninsured and over 95% are low-income, describing the 340B program as "vital."

Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.

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