How Pelosi's drug-pricing plan could wipe out 340B

A 60-word provision in House Speaker Nancy Pelosi's drug-pricing plan could make it impossible for hospitals to get a 340B discount for any drug that Medicare negotiates for, according to STAT.

The 340B discount allows eligible hospitals and clinics to buy outpatient medicines at a discount. Providers are then reimbursed for those drugs at a higher, non-discounted price. The hospital or clinic keeps the difference to cover uncompensated charity care, counseling services and other costs. Participating providers must meet criteria that shows they serve a large percent of uninsured patients.

Ms. Pelosi's provision would likely prevent hospitals from making money off the drugs because they would no longer be able to buy them at a cheaper price and be reimbursed at a higher rate to make a profit. Instead, providers currently participating in 340B would get the same negotiated price and reimbursement amount as non-participating providers.

Drugmakers offered roughly $6 billion in 340B discounts to providers in 2015, which means hospitals would likely lose billions of dollars with the provision, according to STAT.

Tim Horn, the director of medication access and pricing at the HIV and hepatitis advocacy firm NASTAD, said the provision could have "seismic implications" for HIV clinics that get drugs through 340B.

Though it isn't clear if the provision was intended to disrupt the 340B program, it also isn't clear if Democrats will change it, according to STAT.

Lobbyists for 340B hospitals told STAT congressional staffers assured them the provision would be rewritten, but STAT could not confirm that.

Read the full article here.

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