Hickenlooper, Senate 340B Bipartisan Working Group Roll Out Bill to Strengthen Access to Discount Prescription Drugs

340B Drug Pricing Discount Program provides discounted prescription drugs to hospitals, community health centers serving vulnerable communities

Bill strengthens 340B program

WASHINGTON - U.S. Senators John Hickenlooper, Tammy Baldwin, John Boozman, Shelley Moore Capito, Tim Kaine, and Jerry Moran, members of the Senate 340B Bipartisan Working Group, introduced the sweeping SUSTAIN 340B Act to reform the 340B Drug Pricing Program, which provides discounted prescription drugs to health care providers that serve vulnerable, low-income, and underserved patients.

"The input we have received from stakeholders has been invaluable throughout our process, and the legislation we are introducing reflects that feedback by aiming to provide greater stability, clarity, and transparency in the 340B program," said the senators in a joint statement. "The SUSTAIN 340B Act makes comprehensive reforms to the program while preserving the critical benefits it provides to eligible health care providers and the patients they serve throughout the country. By continuing to work together in bipartisan fashion, we are committed to strengthening the 340B program and helping make certain it remains accessible to serve patients and communities for years to come."

The 340B program requires drug manufacturers that participate in Medicaid provide certain covered entities - including non-profit health care providers, such as hospitals and community health centers - a discount on outpatient drugs.

The Senate 340B working group was established to find comprehensive legislative solutions to make sure the program can continue to achieve its intended goal of supporting hospitals serving vulnerable populations like rural communities.

Specifically, their bipartisan SUSTAIN 340B Act would:

• Contract Pharmacy - Codify covered entities' use of contract pharmacies while placing reasonable limitations including registration, audits of covered entities with a large number of contract pharmacies, and standardization of contractual requirements between covered entities and contract pharmacies. The bill does not place numeric or geographic limitations on the use of contract pharmacies.

• Patient Definition - Establish the definition of an eligible patient under the 340B program and covered services for these patients. It also adds requirements and oversight for 340B patients being dispensed 340B drugs through referrals to non-covered entities.

• 340B Rebate Model Pilot Program - End any 340B Rebate Model program within one year and require the Department of Health and Human Services (HHS) transition to the clearinghouse established in the legislation.

• Child Sites - Establish that child sites must be wholly owned and integrated with the parent covered entity, disincentivizes child site acquisitions with the sole purpose of expanding 340B footprints, and directs HHS to establish registration and oversight procedures.

• Transparency - Place new annual reporting requirements on covered entities relating to their utilization of the 340B program.

• Program Integrity - Give HHS authority to establish auditing and reporting procedures for compliance under the 340B program and authorize removal of covered entities who are found in noncompliance and do not implement corrective action plans.

• Safeguards to Prevent Duplicate Discounts - Establish a 340B data clearinghouse operated by an independent, third-party entity to prevent diversion and duplicate discounts in the 340B program.

• Patient Financial Assistance - Require covered entities to establish a standard, transparent patient financial assistance policy for patients at or below 200% of the federal poverty level.

• Equitable Treatment of Covered Participants - Prevent insurers from discriminating against 340B covered entities and their contract pharmacies.

• User Fee Program - Establish a user fee program for participation in the 340B program to pay for program administration, including the clearinghouse.

• Studies and Reports - Require reports to Congress on hospital debt collection practices, dispensing fees, and data collection system integration.

• Additional Resources - Authorize three million dollars annually for five years for conducting oversight and enforcement and nine million dollars annually for four years for bill implementation.

• Sense of Congress - Reiterate the original intent of the 340B program and clarify the program provides point-of-purchase discounts, as opposed to rebates.

• Definitions - Establish definitions for "child site" and "contract pharmacy."

Full text of the legislation available HERE.

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