340B Drug Pricing Program and hospital provision of uncompensated care

The 340B Program and oral specialty drugs for advanced prostate cancer

INTRODUCTION

Expensive oral specialty drugs for advanced prostate cancer can be associated with treatment disparities. The 340B program allows hospitals to purchase medications at discounts, generating savings that can improve care of the socioeconomically disadvantaged. This study assessed the effect of hospital 340B participation on advanced prostate cancer.

METHODS

The authors performed a retrospective cohort study of Medicare beneficiaries with advanced prostate cancer from 2012 to 2019. The primary outcome was use of an oral specialty drug. Secondary outcomes included monthly out-of-pocket costs and treatment adherence. We evaluated the effects of 1) hospital 340B participation, 2) a regional measure vulnerability, the social vulnerability index (SVI), and 3) the interaction between hospital 340B participation and SVI on outcomes.

RESULTS

There were 2237 and 1100 men who received care at 340B and non-340B hospitals. There was no difference in specialty drug use between 340B and non-340B hospitals, whereas specialty drug use decreased with increased SVI (odds ratio, 0.95, p = .038). However, the interaction between hospital 340B participation and SVI on specialty drug use was not significant. Neither 340B participation, SVI, or their interaction were associated with out-of-pocket costs. Although hospital 340B participation and SVI were not associated with treatment adherence, their interaction was significant (p = .020). This demonstrated that 340B was associated with better adherence among socially vulnerable men.

CONCLUSIONS

The 340B program was not associated with specialty drug use in men with advanced prostate cancer. However, among those who were started on therapy, 340B was associated with increased treatment adherence in more socially vulnerable men.

Assessing the Impact of the 340B Drug Pricing Program: A Scoping Review of the Empirical, Peer-Reviewed Literature

Policy Points The 340B Drug Pricing Program accounts for roughly 1 out of every 100 dollars spent in the $4.3 trillion US health care industry. Decisions affecting the program will have wide-ranging consequences throughout the US safety net. Our scoping review provides a roadmap of the questions being asked about the 340B program and an initial synthesis of the answers. The highest-quality evidence indicates that nonprofit, disproportionate share hospitals may be using the 340B program in margin-motivated ways, with inconsistent evidence for increased safety net engagement; however, this finding is not consistent across other hospital types and public health clinics, which face different incentive structures and reporting requirements.

CONTEXT

Despite remarkable growth and relevance of the 340B Drug Pricing Program to current health care practice and policy debate, academic literature examining 340B has lagged. The objectives of this scoping review were to summarize i) common research questions published about 340B, ii) what is empirically known about 340B and its implications, and iii) remaining knowledge gaps, all organized in a way that is informative to practitioners, researchers, and decision makers.

METHODS

We conducted a scoping review of the peer-reviewed, empirical 340B literature (database inception to March 2023). We categorized studies by suitability of their design for internal validity, type of covered entity studied, and motivation-by-scope category.

FINDINGS

The final yield included 44 peer-reviewed, empirical studies published between 2003 and 2023. We identified 15 frequently asked research questions in the literature, across 6 categories of inquiry-motivation (margin or mission) and scope (external, covered entity, and care delivery interface). Literature with greatest internal validity leaned toward evidence of margin-motivated behavior at the external environment and covered entity levels, with inconsistent findings supporting mission-motivated behavior at these levels; this was particularly the case among participating disproportionate share hospitals (DSHs). However, included case studies were unanimous in demonstrating positive effects of the 340B program for carrying out a provider's safety net mission.

CONCLUSIONS

In our scoping review of the 340B program, the highest-quality evidence indicates nonprofit, DSHs may be using the 340B program in margin-motivated ways, with inconsistent evidence for increased safety net engagement; however, this finding is not consistent across other hospital types and public health clinics, which face different incentive structures and reporting requirements. Future studies should examine heterogeneity by covered entity types (i.e., hospitals vs. public health clinics), characteristics, and time period of 340B enrollment. Our findings provide additional context to current health policy discussion regarding the 340B program.

Addressing financial toxicity in cancer treatment-An opportunity for the 340B drug pricing program

Cancer treatment has become increasingly expensive, partially due to the use of specialty drugs. The costs of these drugs are often passed down to patients, who may face the consequences of paying for more than they can afford, leading to financial toxicity. The 340B drug pricing program is a health care policy that may provide an opportunity to mitigate the financial consequences of cancer care. The 340B program requires manufacturers to sell outpatient drugs at a discount to hospitals caring for a significant number of socioeconomically disadvantaged individuals. The program intended for hospitals to use savings from discounted purchases to expand their safety net to vulnerable patients. Some studies have shown that participating hospitals do this by offering more charity and discounted care, whereas others have demonstrated that hospitals fail to sufficiently expand their safety net. A potential flaw of the program is the lack of guidance from governing bodies on how hospitals should use savings from discounted purchases. There has been growing discussion among stakeholders to reform the 340B program given the mixed findings of its effectiveness. With the rising costs of specialty drugs and associated prevalence of financial toxicity in patients with cancer, there is an opportunity to address these issues through reform that improves the program. Directing hospitals to offer specific safety net opportunities, such as passing along discounted drug prices to vulnerable populations, could help the growing number of patients who are financially burdened by medications at the core of the 340B program.

US Hospital Service Availability and New 340B Program Participation

Importance

The US 340B Drug Pricing Program enables eligible hospitals to receive substantial discounts on outpatient drugs to improve hospitals' financial sustainability and maintain access to care for patients who have low income and/or are uninsured. However, it is unclear whether hospitals use program savings to subsidize access as intended.

Objective

To evaluate whether the 340B program is associated with improvements in access to hospital-based services and to test whether the association varies by hospital ownership.

Design, Setting, and Participants

Difference-in-differences and cohort analysis from 2010 to 2019. Never and newly participating 340B general, acute, nonfederal hospitals in the US using data from the American Hospital Association's Annual Survey of Hospitals merged with hospital and market characteristics. Data were analyzed from January 1, 2023, to January 31, 2024.

Exposures

New enrollment in 340B between 2012 and 2018.

Main Outcomes and Measures

Total number of unprofitable service lines, ie, substance use, psychiatric (inpatient and outpatient), burn clinic, and obstetrics services; and profitable services, ie, cardiac surgery and orthopedic, oncologic, neurologic, and neonatal intensive services.

Results

The study sample comprised a total of 2152 hospitals, 1074 newly participating and 1078 not participating in the 340B program. Participating hospitals were more likely than nonparticipating hospitals to be critical access and teaching hospitals, have higher Medicaid shares, and be located in rural areas and in Medicaid expansion states. At public hospitals, participation in the 340B program was associated with a significant increase in total unprofitable services (0.21; 95% CI, 0.04 to 0.38; P = .02) and marginal increases in substance use (5.4 percentage points [pp]; 95% CI, -0.8 pp to 11.6 pp; P = .09) and inpatient psychiatric (6.5 pp; 95% CI, -0.7 pp to 13.7 pp; P = .09) services. Among nonprofit hospitals, there was no significant association between 340B and service offerings (profitable and unprofitable) except for an increase in oncologic services (2.5 pp; 95% CI, 0.0 pp to 5.0 pp; P = .05).

Conclusions and Relevance

The finding of the cohort study indicate that participation in the 340B program was associated with an increase in unprofitable services among newly participating public hospitals. Nonprofit hospitals were largely unaffected. These findings suggest that public hospitals responded to 340B savings by improving patient access, whereas nonprofits did not. This heterogeneous response should be considered when evaluating the eligibility criteria for the 340B program and how it affects social welfare.

Characteristics of 340B Hospitals Receiving Medicare Part B Repayments

This cross-sectional study compared the characteristics of 340B hospitals that did not receive a lump sum payment with hospitals in the program that did receive payment.

Community social vulnerability and the 340B Drug Pricing Program: Evaluating predictors of 340B participation among critical access hospital

PURPOSE

The federal 340B Drug Pricing Program allows eligible hospitals, including critical access hospitals (CAHs), to obtain outpatient drugs at a discounted rate. CAHs likely benefit from 340B participation because they are often under-resourced and serve at-risk patient populations. The objective of this study was to understand predictors of 340B program participation among CAHs, and how participation varies with community-level social vulnerability.

METHODS

We used a cross-sectional study design to assess the relationship between 340B participation in 2019 and community vulnerability status using 2018 data from the CDC's social vulnerability index (SVI) among acute care CAHs. Analyses used linear probability models adjusted for hospital-level characteristics.

FINDINGS

In bivariate analyses, CAHs participating in the 340B program had lower overall social vulnerability scores, relative to nonparticipating, eligible, and ineligible CAHs, respectively (43.8 vs. 48.7 vs. 64.7, p < 0.10). In adjusted regression models, greater community vulnerability rankings due to socioeconomic status (-0.129, p < 0.05) and minority status and language (-0.092, p < 0.05) were associated with decreased 340B participation. Higher hospital operating margin was associated with increased 340B participation (0.163, p < 0.05). Although the number of for-profit CAHs ineligible for 340B was small, they had the highest community-level social vulnerability score and lowest hospital operating margin on average.

CONCLUSIONS

CAHs located in areas of high community vulnerability are less likely to participate in the 340B program. Some vulnerable patient populations served by CAHs may be excluded from 340B program benefits.

The impacts of the 340B Program on health care quality for low-income patients

OBJECTIVE

To assess the effects of hospital 340B eligibility on quality of inpatient care provided to Medicaid and uninsured patients and for all patients.

DATA

Agency for Health Care Research and Quality's Healthcare Cost and Utilization Project State Inpatient Data, Hospital Cost Reporting Information System Data, Office of Pharmacy Affairs Information System Data, and American Hospital Association Annual Survey.

DESIGN

Regression discontinuity design comparing hospitals just above the DSH percentage program eligibility threshold to those just below. Quality measures include all-cause mortality and 30-day readmission rates as well as condition-specific measures.

DATA EXTRACTION

Inpatient data from general acute care hospitals from 2008 to 2014 in 15 states. Data linked on hospital 340B eligibility and participation.

PRINCIPAL FINDINGS

We did not find discontinuities in inpatient care quality across the Program eligibility threshold for Medicaid and uninsured patients; specifically, on all-cause mortality (beta = -0.04 percentage points, 95% CI: -0.16, 0.08), 30-day readmission rates (beta = -0.16 percentage points, 95% CI: -0.81, 0.5), or other measures. Among insured and non-Medicaid patients, we found discontinuities for acute myocardial infarction (beta = -0.87 percentage points, 95% CI: -1.55, -0.2) and postoperative sepsis (beta = -0.15 percentage points, 95% CI: -0.23, -0.07) mortality.

CONCLUSIONS

340B Program participation has not demonstrated improved quality of inpatient care among Medicaid or uninsured patients.

The impact of the 340B Drug Pricing Program on Critical Access Hospitals: Evidence from Medicare Part B

I study the impact of expanding the 340B Drug Pricing Program to include Critical Access Hospitals (CAH) on Medicare Part B drug utilization and spending. The 340B program entitles certain hospitals and clinics to discounts on most outpatient drugs. In 2010, the Affordable Care Act expanded 340B eligibility to CAHs - small rural hospitals that receive cost-based reimbursement from Medicare. Exploiting variation in the predicted exposure to the 340B expansion in a difference-in-differences method, I find that the 340B expansion reduced Part B drug spending but did not affect Part B drug utilization. This finding contrasts with existing evidence about 340B's impact on hospitals but is consistent with the prediction that cost-based reimbursement dampens the incentives created by the 340B discounts. I also find suggestive evidence that CAHs passed the cost savings from 340B on to patients. These results add new perspectives to the ongoing debate over 340B.