Anthony DiGiorgio, a neurosurgeon at the University of California, San Francisco, has raised concerns about the 340B drug discount program. He said that hospitals are misusing the program as a profit-generating tool and called for reforms to enhance transparency and accountability. This statement was made on X on March 11.
"340B is a drug discount program that hospitals exploit as an additional revenue stream," said Anthony DiGiorgio, DO, MHA. "Hospitals generate significantly more revenue by reselling discounted drugs to patients with private insurance. Some hospitals even spend these profits on Super Bowl ads or ventures into unrelated industries, like film studios. The 340B program urgently needs transparency and reform."
According to a 2024 statement by the Coalition of State Rheumatology Organizations (CSRO), the 340B Drug Pricing Program has seen unchecked expansion and lacks sufficient transparency measures. CSRO reports that while the program was originally designed to support care for underserved patients, it now generates over $60 billion annually, often without clear documentation on how savings are used to benefit low-income populations. The organization advocates for reforms to ensure the program aligns with its original intent and supports those most in need.
The Minnesota Department of Health’s 2024 report on the 340B Drug Pricing Program indicates that 45% of net 340B revenue in the state came from Medicaid and Medicare. The report shows that 83% of contract pharmacy locations were in urban areas, and 60% were in ZIP codes with above-median income. Data for this report was collected from 78 covered entities and 1,406 contract pharmacy arrangements in 2022.
A study published in 2014 by the National Library of Medicine examined characteristics of hospitals participating in the 340B Drug Pricing Program. It found that these hospitals were more likely to be located in communities with higher rates of insurance coverage and higher household incomes than non-340B hospitals. The analysis used national hospital and community data covering the period from 2008 to 2012.
According to his website, DiGiorgio is also a health policy researcher who writes about topics including physician autonomy, healthcare delivery systems, and drug pricing policy. His work includes peer-reviewed publications, opinion articles, and policy analysis.
