man offering cash Milliman’s analysis of claims data found that while 340B hospitals on average pay $1,591 per claim for a brand medicine, on average they get reimbursed $4,673 by a commercial insurer. (Photo: iStock)

Hospitals participating in the federal 340B drug discount pricing program are getting reimbursed by payers three times the amount they initially paid for brand medicines – but there’s no requirement for them to demonstrate the additional revenue is going toward helping vulnerable people, according to an analysis conducted by Milliman, commissioned by the Pharmaceutical Research and Manufacturers of America.

The 340B program, created by Congress in 1992, is meant to give drug discounts to “safety net facilities” and other qualifying hospitals so uninsured and other vulnerable patients can get access to prescription medicines at discounted rates, the authors write in the white paper. While clinics that receive federal grants are typically required to use revenue from 340B to provide care to vulnerable communities, reinvest any additional resources into services for vulnerable patients and meet reporting requirements on use of 340B revenue, similar requirements do not apply to 340B hospitals.

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Katie Kuehner-Hebert

Katie Kuehner-Hebert is a freelance writer based in Running Springs, Calif. She has more than three decades of journalism experience, with particular expertise in employee benefits and other human resource topics.

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