Occasionally I'll read something that is so contrary to my own perception that I'll find myself questioning reality.
This American Hospital Association piece about 340B is one of those. This is a masterclass in gaslighting. Here the profiteers are masking themselves as victims.
They actually claim hospitals have no program integrity problems. HRSA audits have found over $1B in fraudulent duplicate discounts annually. State Medicaid directors say the scope of fraud is "enormous" but they don't know the scope because they're prohibited from tracking it. Multiple reports, including from the Senate HELP committee and the Minnesota 340B report have stated 340B concentrates revenue in large hospital systems with little evidence of benefit to patients.
They claim the rebate system will harm safety-net hospitals. This ignores that it's large hospital corporations which are reaping the benefits. The Minnesota report showed that 13% of hospitals generated 80% of the revenue, and none of it went to safety-net facilities. Meanwhile, 340B hospitals charge higher commercial prices, which is a direct burden on patients since 90% of Americans don't hit their deductible.
They claim that 340B hospitals provided $84B in "community benefits." Yeah, if you include activities that are already subsidized by other revenue streams. Meanwhile, reports from sources as varied as GAO, the Wall Street Journal and the New York Times have all found little evidence that 340B revenue translates into patient benefits.
They claim upfront discounts have worked for 30 years. That ignores the exponential growth over the last decade. 340B was $8B in sales as recently as 2010 and is now closer to $70B annually now. Contract pharmacies have gone from around 1,000 to over 30,000.
They cry about the admin costs and floating the acquisition prices for drugs. Meanwhile, the Minnesota report found that over $100B went to administration costs in that state in one year alone. Large hospital systems have massive cash reserves, investment portfolios and favorable bond ratings.
The 340B rebate model is a great step to program reform. It's just a first step, and we should go further, if not just to see what sort of polemics the AHA can come up with.