The PROTECT 340B Act Would Block Health Insurers & Pharmacy Benefit Managers from Treating 340B Pharmacies and Providers Differently than Other Healthcare Providers

WASHINGTON, D.C. — U.S. Representatives Abigail Spanberger (D-VA-07) and Dusty Johnson (R-SD-AL) today led the reintroduction of a bipartisan bill that would prohibit insurers and pharmacy benefit managers (PBMs) from hurting hospitals and clinics that participate in the federal 340B Drug Pricing Program.

The bipartisan Preserving Rules Ordered for the Entities Covered Through (PROTECT) 340B Act is in response to concerns from healthcare providers in Virginia, South Dakota, and across the country — particularly in rural areas — that have seen their access to the program threatened by PBMs, insurers, and pharmaceutical companies.

The PROTECT 340B Act would prohibit health insurers and PBMs from discriminating against 340B providers or their contract pharmacies on the basis of their status as providers or pharmacies that dispense 340B drugs. Specifically, the Spanberger-Johnson legislation would prevent companies from treating 340B providers differently with regards to reimbursement of fees, participation in standard or preferred networks, or inventory management systems — and it would block them from interfering in a patient’s choice to receive drugs from a 340B pharmacy.

“The 340B Program lowers prescription drug costs and saves money for seniors and families, especially those in rural and underserved communities. But in recent years, we’ve seen for-profit insurance companies and the shadowy middlemen of the pharmaceutical industry — known as pharmacy benefit managers — undermine these discounts, target 340B providers, and threaten the very survival of this program,” said Spanberger. “The PROTECT 340B Act would hold these actors accountable for trying to take away the savings of American consumers. I want to thank my colleague Congressman Johnson for his partnership on this issue, and we’ll keep working to level the playing field for 340B pharmacies and providers, maintain access to discounted medications, and protect the financial security of patients in Virginia and across the country.”

“340B is an essential program for rural and low-income hospitals and patients,” said Johnson. “South Dakotans rely on this program to access affordable drugs and medicines they need. The PROTECT 340B Act will ensure the quality of care for communities that need it.”

“NRHA applauds Representatives Spanberger and Johnson for their continued leadership to uphold the integrity of the 340B Drug Pricing Program. The 340B Drug Pricing Program is a critical lifeline for rural providers.  Attacks from pharmacy benefit managers (PBM) and large pharmaceutical manufacturers are undermining the integrity of this important program to the feasibility of rural hospitals and clinics. That is why NRHA is supporting Protect 340B Act in order to protect covered entities, especially those in rural areas,” said Alan Morgan, CEO, National Rural Health Association.

“Health centers nationwide depend on the 340B program to provide affordable medications and comprehensive health care services to the 30 million patients they serve. Unfortunately, Pharmaceutical Benefit Managers are threatening the long-term stability of these services by siphoning off savings that should be going to health centers. NACHC supports the PROTECT 340B Act as a first step to broader reforms to the 340B program,” said Rachel Gonzales-Hanson, Interim President & CEO, National Association of Community Health Centers (NACHC).

“The 340B program can seem complex, but for our work, it’s simple: 340B is helping to end the HIV epidemic by giving people access to the lifesaving health care they need. The PROTECT 340B Act would ensure the ongoing stability and sustainability of the 340B program, so that safety net providers across the country can continue to provide the comprehensive care that our communities need and deserve. We applaud Reps. Abigail Spanberger and Dusty Johnson for their leadership to safeguard this critical program,” said Carl Baloney, Jr., Vice President & Chief Advocacy Officer, AIDS United.

“Essential hospitals thank Reps. Johnson and Spanberger for introducing the PROTECT 340B Act. The 340B program is vital to millions of low-income patients and our nation’s health care safety net. We call on Congress to defend the 340B program against drug industry attacks by passing this important legislation,” said Dr. Bruce Siegel, President & CEO, America’s Essential Hospitals.

“The PROTECT 340B Act introduced by Representatives Spanberger and Johnson will enable America’s hospitals to continue to provide critical care to patients in low income and underserved areas without the threat of discrimination from PBMs and insurers. The 340B program is integral to hospitals’ ability to provide healthcare services to uninsured and underinsured patients, so protecting the program means protecting patients,” said Tom Kraus, Vice President, Government Relations, American Society of Health-System Pharmacists.

“340B hospitals applaud Representative Spanberger for her strong leadership to protect safety-net providers from discriminatory payment behavior by pharmacy benefit managers and insurance companies. 340B savings provide crucial resources to hospitals and other providers caring for patients with low incomes and those living in rural communities. PBMs and payers undermine that investment in patient care when they pay less to covered entities based solely on their participation in 340B. This bipartisan legislation would ensure that those 340B dollars go to care for patients of the health care safety net as Congress intended and not into more profits for PBMs and insurers,” said Maureen Testoni, President & CEO, 340B Health.

“We can’t thank Rep. Spanberger enough for her tireless advocacy on behalf of 340B, our patients, and our community. VCU Health is the Commonwealth’s largest safety net provider. The 340B program makes a real, tangible difference in our patients’ lives by allowing us to provide more than 16,700 free or deeply discounted drugs annually to those with the most need. Beyond that, we use 340B savings to improve patients’ health in our hospitals and our communities through programs like our coordinated community care model, Virginia Supportive Housing Partnership, Medical-Legal Partnership Program, and more. The PROTECT 340B Act will protect our patients by ensuring their continued access to affordable prescriptions and community programs,” said Dr. Marlon Levy, Interim Senior Vice President, VCU Health Sciences; Interim CEO, VCU Health.

“CVHS is grateful that Congresswoman Spanberger is reintroducing the PROTECT 340B Act. Since the inception of the 340B program,  CVHS has been a good steward of the program and has reinvested the savings back into our patients and communities. Without these savings, we could not provide comprehensive dental and behavioral health services, have expanded hours or offer care coordination to help those with the least access to receive resources needed to improve their healthcare.  The 340B program places our patients in rural and disenfranchised communities closer to health equity.  We have seen patients lower their A1Cs, have increased adherence to medication therapies, and in some of our Hepatitis B patients seen the disease be undetected – all because of the access to discounted medications and savings from the 340B program. Community health centers across the country will face catastrophic consequences and cease to exist in their current capacity if the 340B program for health centers is not protected. We hope that Congress will come together in support of this legislation to protect community health centers and our patients,” said Paula Tomko, CEO, Central Virginia Health Services.

Click here to read the full bill text.

BACKGROUND

The 340B Drug Pricing 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 demonstrated record of protecting patients who are low-income, live in underserved communities, or suffer from serious chronic illnesses from the threat of skyrocketing prices for the drugs they depend on the most.

###