During the Congresswoman’s Bipartisan Special Order Hour, Lawmakers Called out Illegal Actions that are Increasing Prescription Drug Costs, Reducing Access to Affordable Medications for Seniors, and Threatening the Stability of America’s Rural Hospitals & Clinics

WASHINGTON, D.C. — U.S. Representative Abigail Spanberger (D-VA-07) this week led a bipartisan group of her colleagues in speaking on the floor of the U.S. House in support of the federal 340B Drug Discount Program.

The 340B Drug Discount Program was enacted by Congress in 1992 with bipartisan support and is overseen by the U.S. Department of Health and Human Services (HHS). The program requires that pharmaceutical companies give safety-net and rural healthcare providers discounts on their drugs — in exchange for having their drugs covered by Medicaid. The program has a longstanding record of keeping drug costs low for U.S. patients who are low-income, live in rural communities, or suffer from serious chronic illnesses. This year marks the 30th anniversary of this successful program.

But in recent years, 17 drug manufacturers have now stopped honoring 340B discounts for drugs dispensed through pharmacies that contracted with 340B providers — dramatically increasing the price of those drugs for vulnerable patients and healthcare providers.

During the special order hour led by Spanberger, Democrats and Republicans shared stories from their communities highlighting the importance of the 340B Program. Additionally, they outlined their opposition to illegal actions by the 17 pharmaceutical companies that are violating 340B laws — and thereby hiking prescription drugs costs for healthcare providers in rural and underserved communities. Spanberger led the special order hour alongside U.S. Representative John Rose (R-TN-06). They were joined by U.S. Representatives Chuy Garcia (D-IL-04), Glenn “GT” Thompson (R-PA-15), Danny K. Davis (D-IL-07), Tom O’Halleran (D-AZ-01), and Chris Pappas (D-NH-01).

Click here to watch the full special order hour.

SPANBERGER KEY QUOTES

VIDEO: Spanberger Commemorates 30th Anniversary of 340B Program, Defends Discounts on House Floor DOWNLOADABLE VIDEO

“The 340B program has helped hospitals, community health centers, and federal grantees stretch their scarce resources as far as possible, helping them reach more eligible patients and provide more comprehensive services. The way it works is simple: 340B requires pharmaceutical companies to make drugs more affordable for health care providers serving vulnerable communities and low-income patients. By discounting the drugs, these providers can stretch their resources further and reach even more patients. The 340B program is especially important for providers in rural America. In these areas, lower incomes lead to higher rates of uncompensated care and a disproportionate number of patients with Medicare and Medicaid.

“Unfortunately, since the summer of 2020, at least 16 pharmaceutical companies have announced or implemented restrictions on 340B pricing. Both the current Biden Administration and the previous Trump Administration have found these restrictions to be unlawful, yet HHS has taken no serious enforcement action to prevent or penalize these illegal actions.

“Let me be very clear: every time a pharmaceutical company withholds a 340B discount from an eligible pharmacy, that company is unlawfully overcharging the health care safety net and withholding resources from the most vulnerable patients in our communities. And in response, we need to defend 340B.”

VIDEO: Spanberger Advocates for Her Bipartisan Bill to Protect Providers’ Federal 340B Drug Discounts

“I was proud to work with our colleagues across the aisle to introduce the PROTECT 340B Act to stop PBMs from, frankly, pickpocketing 340B discounts so we can ensure the benefits of 340B reach the community health centers, the HIV/AIDS clinics, and the rural hospitals that Congress intended to support.

“Our bill is in response to the stories that we have heard from pharmacists across our districts: PBMs have established two tiers of payment for pharmacy-dispensed drugs: one for chain and retail pharmacies unassociated with 340B providers, and another significantly lower rate for 340B pharmacies. Years of market consolidation have given the three leading PBMs incredible market power, and they can effectively dictate terms to smaller 340B pharmacies. So, what that means is PBMs are essentially pickpocketing 340B savings from safety-net providers. And instead of helping the health care safety net reach more patients, the 340B savings are subsidizing the profits of some of the largest, most profitable companies in America. And that means that those safety-net hospitals, those rural hospitals, those federally-qualified health centers are not able to put those savings towards care to patients.

“Our PROTECT 340B Act would hold PBMs accountable and prevent them from applying these predatory business practices to the local health centers, the rural hospitals, and other federal grantees. It also would create a national clearinghouse to track 340B discounts and make sure 340B drugs are not included in states’ Medicaid rebate requests. Together, these changes would restore the integrity of the program and protect the health care safety net so many of our constituents rely on.”

VIDEO: Spanberger Explains How 340B Prescription Drug Discounts Help Safety-Net Hospitals, Like VCU Health

“VCU is the largest safety-net hospital in Virginia. And it serves the greatest number of uninsured and Medicaid patients in our Commonwealth. Nearly three quarters of VCU’s payor mix is public or uninsured. And I’m proud that VCU has been a good steward of the discounts it receives through the 340B Program — consistent with congressional intent that 340B program be used to ensure these discounts can stretch federal resources.

“The 340B program supports VCU Health System’s commitment to serving all members of the community, regardless of their ability to pay. In 2020 alone, the program’s savings helped VCU Health provide nearly 2,100 patients with 27,300 discounted or free medications and over $64 million in uncompensated care in Fiscal Year 2021. So, I’m going to repeat that: the program’s savings, the savings that VCU was able to get through the 340B program, allowed them to provide $64 million in uncompensated care.”

WHAT THEY’RE SAYING

“Virginia Commonwealth University (VCU) Health System thanks Rep. Spanberger for her unwavering leadership in support of the 340B drug pricing program,” said Dr. Arthur Kellermann, Senior Vice President, VCU Health Sciences & CEO, VCU Health. “As the Commonwealth’s largest safety net provider, the 340B drug pricing program is a critical tool for VCU Health System to fulfill its mission to serve our community and those patients with the greatest financial need. We are grateful for Rep. Spanberger’s commitment to 340B.”

“Congresswoman Spanberger’s continued leadership in support of the 340B drug discount program is needed now more than ever to ensure UVA Health has the critical resources we need to serve our patients, especially those who are most vulnerable and cannot afford the high cost of their medicines,” said Wendy Horton, PharmD, MBA, FACHE, CEO, University of Virginia (UVA) Medical Center.

“We applaud Congresswoman Spanberger for her tireless work to hold pharmaceutical companies accountable for damaging changes made to the 340B program.  Over the past two years, organizations such as community health centers, have felt the devastating impact of these changes to the program.  Unfortunately, at the end of the day, our patients feel the impact the most by not having access to affordable, lifesaving medications.  We are grateful for the bipartisan support, and we encourage all of our legislators to hold HHS and pharmaceutical companies accountable and fix the 340B program,” said Paula Tomko, CEO, Central Virginia Health Services.

“On behalf of the nation’s safety-net hospitals, I applaud Congresswoman Spanberger, Congressman Rose, and the other members of Congress who came to the House floor for this historic event to speak in support of the 340B drug pricing program and help commemorate its upcoming 30^th anniversary,” said Maureen Testoni, President & CEO, 340B Health. “We are grateful for the steadfast, bipartisan backing of members who recognize that 340B discounts are essential for providing safety-net health care and support for the patients most in need throughout the nation. We echo the calls from these lawmakers for additional federal enforcement actions against drug companies that are breaking the law by restricting access to drug savings. We also join them in urging congressional leaders to take up and pass legislation to ban PBM and insurer payment policies that discriminate against safety-net providers. Defending and protecting 340B in these ways is necessary for the program to achieve its patient care mission.”

“We applaud Reps. Spanberger and Rose and all other members of Congress who participated in the Special Order hour last night. Seeing Rep. Spanberger and Rose amplify the importance of the 340B program for persons living with HIV/AIDS was truly inspirational for those of us working to serve these vulnerable populations,” said Shannon Stephenson, President, Ryan White Clinics for 340B Access (RWC-340B); CEO, Cempa Community Cares.

“The AHA thanks Representatives Spanberger and Rose, and this bipartisan group of representatives, for their continued support of the 340B program, and their recognition of the program’s 30 year track record of providing immeasurable value to hospitals and the vulnerable patients and communities they care for. We commend them on working tirelessly to protect the 340B program and ensure that 340B hospitals and other providers can continue to provide critical programs and services to their communities,” said Lisa Kidder Hrobsky, Vice President of Federal Relations, Advocacy, and Political Affairs, American Hospital Association.

“For 30 years, the 340B Drug Pricing Program has been an invaluable tool for essential hospitals to achieve their mission of providing high quality care to all and mitigating poor health outcomes caused by socioeconomic barriers to care,” said Bruce Siegel, MD, MPH, President & CEO, America’s Essential Hospitals. “We thank these bipartisan lawmakers, led by Representatives Spanberger and Rose, for recognizing the contributions of the 340B program in supporting the health care safety net and speaking out against harmful actions by now 17 drug manufacturers to unlawfully restrict the 340B program.”

“NACHC appreciates Rep. Spanberger celebrating the 30th anniversary of the 340B program and bringing more awareness for the need for Congressional action to protect this vital program. Health centers across the country depend on the 340B program to provide affordable medications and comprehensive primary care services to uninsured and underinsured patients. As health centers continue to serve on the front lines responding to the COVID-19 pandemic, the growing attacks by pharmaceutical manufacturers are threatening not only the stability of the 340B program, but health centers’ ability to keep their doors open. We appreciate the support and look forward to creating permanent solutions for the nation’s safety-net providers that participate in the 340B program,” said Rachel Gonzales-Hanson, Interim President & CEO, National Association of Community Health Centers (NACHC).

“The National Hemophilia Foundation thanks Representative Spanberger and her colleagues who took part in the 340B Special Order session. People with hemophilia and other inherited blood disorders depend on the network of hemophilia treatment centers to live their healthiest lives. Through their participation in the 340B Drug Discount Program, HTCs are better able to meet the specialized, comprehensive care needs of their patients. We applaud all efforts to strengthen this crucial program to benefit all patients,” said Nathan Schaefer, Vice President for Public Policy, National Hemophilia Foundation.

“On behalf of the Hemophilia Alliance and our hemophilia treatment center (HTC) members, we are grateful to Representative Spanberger and the other participants in the 340B Special Order Hour for highlighting the importance of this federal program to communities like ours.  Participation in the 340B Program enables the national network of HTCs to provide gold-standard, integrated, multidisciplinary care to more than 70,000 patients across the country.  It is vital that this program is protected for all vulnerable patient communities,” said Joe Pugliese, President &CEO, Hemophilia Alliance. 

ADDITIONAL INFORMATION

Even after warnings from HHS in 2021, companies in violation of 340B laws have made no effort to come into compliance with their lawful obligations — and HHS has not followed through with an enforcement action. This situation jeopardizes the integrity of the entire program and threatens affordable drug availability throughout rural America.

Earlier this year, Spanberger pressed the Biden administration take immediate action against drug manufacturers that refuse to comply with the 340B laws on the books. Additionally, the bipartisan letter called on HHS to protect rural providers’ access to discounted drugs.

Last year, Spanberger introduced the bipartisan Preserving Rules Ordered for the Entities Covered Through (PROTECT) 340B Act to prohibit insurers and Pharmacy Benefit Managers (PBMs) from discriminating against 340B providers or their contract pharmacies on the basis of their status as providers or pharmacies that dispense 340B drugs.

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