E&C Health Subcommittee Reviews 340B Program and Recent GAO Report on Contract Pharmacies

12 Jul 2018

The House Energy and Commerce (E&C) Health Subcommittee held a hearing on the 340B program yesterday at 10 a.m. titled “Opportunities to Improve the 340B Drug Pricing Program.” The Subcommittee received testimony about the recent report released in June by the Government Accountability Office (GAO) recommending seven ways to improve oversight of providers’ use of 340B contract pharmacies.   The subcommittee also received feedback on seven introduced bills and eight discussion drafts that would amend the 340B Program.

The hearing had testimony from four witnesses over almost four hours:

In first half of hearing, Dr. Draper summarized and answered questions about the June 28 GAO report.  Dr. Draper also testified that work is starting on a new report regarding duplicate discounts in 340B which should be expected in roughly 9 to 12 months.

Testified in the second half of the hearing the about his hospital’s experience with the 340B Program.

  • Dr. Charles Daniels, Pharmacist-In-Chief and Associate Dean, University of California, San Diego (Opening Statement)

Testified in the second half of the hearing about his hospital’s experience with the 340B Program.

Testified in the second half of the hearing about independent oncology practices that claim harm from hospital use of the 340B program.

While all members praised the 340B program, they differed on the question as to whether the 340B program needs substantial reform and whether the program was meeting its intent.   The committee members largely split along party lines during the hearing with several Republicans making the case that healthcare had changed dramatically in the past twenty-five years since the statute was enacted, and that it is time to reevaluate the 340B program’s intent and operation within the context of medicine today.   Some of the Republican members raised questions about potential limits to the program such as whether entities should be required to pass all savings to indigent patients or whether the program should be limited to a direct patient benefit. Rep Collins (R-NY) stated that some hospitals that used 340B to offset operating costs were bad actors taking advantage of 340B.   Rep Carter (R-GA) questioned whether the fully insured such as movie stars should be eligible for 340B drugs.  Rep. Barton (R-TX) raised the possibility of increasing the current DSH eligibility from 11.75% to 18% for DSH hospitals and said he had no doubt that the intent of the program was to lower the cost of drugs to low income patients.  Others raised the possibility of new measures for hospital eligibility.  Increased transparency on how program savings is utilized was emphasized by several members.    The committee’s Democrats focused primarily on the successes of the 340B program, that to enable safety-net providers stretch scarce federal resources to reach more eligible patients and provide more comprehensive services remained the clear intent of the program, and cautioned against narrowing or restricting the program. Rep. Matsui (D-CA) discussed her legislation, H.R. 6071, “Stretching Entity Resources for Vulnerable Communities Act,” which is strongly supported by RWC-340B. The legislation is the only comprehensive 340B legislation introduced in Congress that is intended to preserve and protect the 340B program.

Category: Congress

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