Reforming 340B to Promote Program Integrity and Better Serve Vulnerable Populations: An American College of Physicians Policy Brief

The United States pays some of the highest prices for prescription drugs in the world, with drug prices and overall spending increasing year-over-year. Ballooning prescription drug costs can result in low rates of medication adherence, negatively affecting public health and straining national health care systems and resources. The 340B Drug Pricing Program (340B Program), which allows health care safety-net settings to purchase prescription drugs at deep discounts, has long sought to function as a bulwark against increasing drug prices for institutions serving those most vulnerable in society. Savings from the program have facilitated expanded access to health care services for low-income and uninsured patients. However, shortcomings in the program's design, implementation, and oversight obscure to what degree low-income and uninsured patients are realizing program benefits and create incentives for institutions to undertake profit-seeking behaviors at the expense of patients. To strengthen the 340B Program and ensure it is best serving its intended audience, reforms are needed within the program to promote transparency in how drug savings are reinvested into patient care and mandate demonstrated benefit to low-income and uninsured populations. Access to contract pharmacies-that is, the specialty or community-based pharmacies that 340B Program "covered entities" have an agreement with to distribute medications to patients-should be preserved, with appropriate guardrails to prevent unauthorized diversion. Federal regulators should be empowered with the resources and clear statutory authority necessary to engage in meaningful oversight of all program participants.