• Talking Points
  • March 14, 2018

340B Drug Pricing Program Talking Points

Children's hospitals depend on the 340B Drug Pricing Program to provide needed services to vulnerable patients.

  • By providing outpatient pharmaceuticals at discounted rates, the 340B Drug Pricing Program (340B program) enables enrolled hospitals to provide reduced-price drugs to patients, expand comprehensive health services and offset losses from serving children whose families cannot pay. 340B program sales are less than 3 percent of the U.S. drug market.
  • The 340B program supports safety net providers, such as children's hospitals, in their mission to serve low-income, uninsured and under-insured patients while reducing federal and state health care expenditures. To date, 52 freestanding children's hospitals have enrolled in the program.
  • On average, more than half of all patients treated at children's hospitals are covered by Medicaid, which pays approximately 30 percent less compared to Medicare.
  • Children's hospitals became eligible for the program in 2006 and officially participated starting 2009. Children's hospitals remain fully committed to improving program integrity, and support the administration's ongoing audits and annual recertification process.

Senate HELP Act (S. 2312) and the House 340B Pause Act (H.R. 4710)

  • These bills increase regulatory burden without improving 340B program integrity. For example, the bills fail to recognize the unique structure of children's health care, and impose Medicare requirements on children's hospitals without considering their applicability. Only a tiny percentage of children treated in children's hospitals are covered by Medicare — those with end-stage renal disease.
  • The adoption of charity care reporting requirements by each of the bills do not capture the full benefits children's hospitals provide to the communities they serve. Due to Medicaid and the Children's Health Insurance Program (CHIP), the nation has the highest rates of insured children in history and most children's hospital patients are insured. The emphasis on patient insurance rates as a primary metric misses the real picture when it comes to children's health.