Sally Pipes, President and CEO of the Pacific Research Institute, expressed concerns about the 340B Drug Pricing Program, stating that it has deviated from its original goal of aiding low-income patients. She asserted that wealthy hospitals are benefiting while providing below-average charity care. Pipes made these remarks on X.
"340B was meant to help low-income patients," said Pipes. "Instead, wealthy hospitals pocketed the revenue and spent less on charity care than the average U.S. hospital."
The federal 340B Drug Pricing Program was established in 1992 to mandate drug manufacturers to provide significant discounts to eligible hospitals and clinics serving low-income or uninsured patients. According to the Association of American Medical Colleges (AAMC), these savings aim to assist safety-net providers in maximizing resources and enhancing access to essential medications. However, oversight gaps have raised concerns about the uneven distribution of benefits.
A New York Times investigation in 2022 revealed that numerous non-profit hospitals across the United States, including those participating in the 340B program, charged poor patients who qualified for free or discounted care and allocated minimal spending to charity care. Some large systems reportedly spent less than 2% of their expenses on assisting low-income patients despite receiving tax breaks and federal program benefits.
According to a 2024 Health Affairs Scholar study, hospitals involved in the 340B Drug Pricing Program generated significant profits from discounted drug purchases but showed limited evidence that these savings improved access or affordability for low-income patients. The researchers concluded that most 340B hospitals did not offer higher levels of charity care compared to non-340B institutions.
Pipes has been at the helm of the Pacific Research Institute since 1991, where she leads research and advocacy efforts on healthcare, education, and economic policy. A notable advocate for free-market healthcare reform, she supports patient-centered solutions aimed at expanding access and affordability. Additionally, Pipes is a regular columnist for Forbes and National Review, contributing extensively on policy innovation and government reform.
