American Consumer Institute, a free-market consumer policy think tank, said Congress designed the 340B Drug Pricing Program to help vulnerable patients, not prop up hospital balance sheets, calling for real reporting and point-of-sale discounts that follow the patient.
"Congress created 340B for vulnerable patients, not vulnerable balance sheets. Time to require real reporting, cut off hospitals that don't need it, and move toward point-of-sale discounts so the discount actually follows the patient, not the institution," said the American Consumer Institute on X.
Eighty-five percent of disproportionate share hospitals earned more in 340B profit in 2022 than they spent on charity care. DSH hospitals earned an estimated $44.1 billion in 340B profit that year but reported just $18.5 billion in charity care costs and are not required to report their 340B profit or how it is used, according to the Alliance for Integrity and Reform of 340B.
The number of hospitals participating in the program has grown from 39 in 1992 to nearly 3,000 in 2024, with discounted purchases reaching $81.4 billion that year. The statute does not require hospitals to report how much money they make through the program or how they spend it—even when revenue comes from Medicare, according to the Paragon Health Institute.
The Congressional Budget Office found that the gap between discounted prices under the program and higher amounts paid by Medicare increases federal spending, with those added costs ultimately falling on taxpayers. Spending on drugs by participating facilities rose from $6.6 billion in 2010 to $43.9 billion in 2021, according to the Congressional Budget Office.
The American Consumer Institute Center for Citizen Research is a nonpartisan organization based in Arlington, Virginia, that researches economic policy issues including health care and is an associate member of the State Policy Network, according to the group.
