Health Center Federal Policy, Health Center Regulatory Issues

House Subcommittee Focuses on the 340B Program

While other health care related issues have certainly taken up much of the space on Congress’ agenda over the past year, the 340B program can be added to the list of issues at which Congress has taken a closer look at over the past several months.  A case in point is the House Energy and Commerce Committee Subcommittee on Oversight and Investigations, which has taken a much more in depth look at the program over recent months.

It all started last June when leadership of the House Energy and Commerce (E&C) Committee sent a letter to the Health Resources and Services Administration (HRSA), which oversees the 340B program.  The letter requested detailed information about HRSA’s management of the 340B program and specifically how they audit covered entities.  The House E&C Subcommittee on Oversight and Investigations then followed up with a hearing entitled, “Examining HRSA’s Oversight of the 340B Drug Pricing Program.  Officials from HRSA, as well as the Government Accountability Office (GAO) and the HHS Office of the Inspector General (OIG), testified and made recommendations about how the program can be improved.   Among the points that were underscored was that HRSA had limited authority in some aspects of program management, including tracking how entities use savings from the program. For those that have followed 340B over the past several years, you will recall that the last time a 340B-focused hearing was held was back in March of 2015.

The same House subcommittee held a second hearing last week entitled, “Examining How Covered Entities Utilize the 340B Drug Pricing Program.” Witnesses for the hearing included three hospital covered entities as well as two HRSA grantee covered entities.  Among them was Carolina Health Centers, located in South Carolina, represented by President and CEO Sue Veer.   The subcommittee prepared for the hearing by sending letters to several covered entities, including health centers, asking for detailed feedback about how program savings are calculated and used by covered entities. Not surprisingly, much of the questions directed at the witnesses centered around the information the subcommittee had collected.

Overall, there was broad support for the mission of the 340B program from members on both sides of the aisle. However, several lawmakers expressed general concern over the lack of program transparency and the need for additional oversight.  Several subcommittee members underscored their concerns around the lack of reporting requirements for covered entities, including how they use savings from the program, and whether the savings are passed along to patients in the form of additional services or reduced drug costs. In general, concerns were directed more at hospital covered entities than organizations like health centers, Ryan White Care Act entities, and others who are already subject to considerable oversight as a result of being federal grantees.

While specific plans for additional hearings or requests for information are not known at this time, it remains clear that several members continue to share concerns around the recent growth of the program, as well as a need for greater transparency and accountability on behalf of covered entities within the 340B program. We will continue to monitor any updates and share those as they become available.  If you have any questions or would like any further information, please reach out to NACHC’s Federal Affairs team at federalaffairs@nachc.org.

One Commnet on “House Subcommittee Focuses on the 340B Program

  1. I am a patient board member of Hopewell Health Centers, Inc. in southern and southeast Ohio. 340b is such a strong program which positively affects our financial health that we ought to be willing to explore ways of responding to the concerns with specific proposals to address them in a cost effective manner.

    I would like to know more detail about the concerns expressed by the committee and what is really behind this (is it the drug companies?). I would also appreciate more detail as to how NACHC will be responding to this.

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