STATEMENT BY 340B HEALTH ON GAO REPORT ON OVERSIGHT OF COMPLIANCE AT 340B CONTRACT PHARMACIES
Washington, D.C.—Contract pharmacies are a critical part of how the 340B program provides resources to safety net hospitals, allowing them to meet the needs of low-income and rural patients. The GAO report confirms that contract pharmacies play an essential role in helping uninsured and low-income patients get needed care, including, but not limited to, prescription drugs.
The contract pharmacy benefit is especially vital for rural hospitals. In a survey of 340B Health members, 87 percent of rural hospitals reported they use their contract pharmacy benefit to maintain operations. Disproportionate share (DSH) hospitals reported using their contract pharmacy benefit to provide direct services to low-income patients, with 89 percent using their contract pharmacy benefit to support uncompensated care and 71 percent using their benefit to provide free or discounted drugs to patients.
Contract pharmacies are just one part of a small, but powerful, 340B program. In 2015, the 340B program provided $6 billion in savings from statutory discounts on outpatient drugs, while 340B hospitals provided more than $26 billion in uncompensated and unreimbursed care.
340B hospitals fully support compliance with the requirements of the 340B program, including contract pharmacy rules. Since 2012, HRSA has dramatically increased its oversight of 340B providers, auditing more than 1,000 340B providers and providing more education on the expectations it has for hospital compliance with existing rules. HRSA has continued to issue FAQs, conduct webinars, and present at conferences on 340B compliance and the audit process. HRSA has already provided a great deal of education to covered entities and we support any additional education to assist hospitals in implementing the systems needed to comply with HRSA’s standards.
GAO recommends changes to the HRSA audit process and areas for additional guidance. We are concerned that some of these recommendations could make program participation significantly more cumbersome for hospitals without improving transparency or compliance. We look forward to reviewing these recommendations in more detail and continuing to work with lawmakers to protect this vital program.
Contact: Richard Sorian at richard.sorian@340bhealth.org or 202-536-2285.