Academic Literature

Expansion of the Medicare 340B Payment Program

As the 340B program expands, it continues to draw national attention.

Authors

Originally published on 12/11/2018 in JAMA Viewpoint

Dr. Peter B. Bach of Memorial Sloan Kettering Cancer Center and Rachel E. Sachs of Washington University in St. Louis outline the unintended consequences of the expansion of the program.

Originally developed to benefit health care facilities that serve disadvantaged patient populations, the 340B program has resulted in a distortion of misaligned incentives. Hospitals, many of which are large and well financed, now dominate the facilities that qualify for this program, and this shift has led to controversy over the program’s purpose, effects, and incentives. The Centers for Medicare & Medicaid Services (CMS) took recent actions to rein in the program, and these actions are now facing court challenges.

Read the full article here.

 

Share

Authors

Research & Insights

We conduct non-partisan, independent research, and make our work accessible and informative to policymakers and the general audience alike. Browse our featured research or explore our work by article type.

The 340B Program: Hospitals Profit by Reaching Affluent Communities
The 340B program is being converted from one that serves vulnerable patient populations to one that enriches hospitals and their affiliated clinics.
Health Affairs 10/01/2014
Cost Consequences of the 340B Drug Discount Program
Unintended consequences of the 340B drug discount program alter physician prescribing habits, widen the disparity in hospital profits, and increase list prices of drugs to compensate for revenue losses.
JAMA Viewpoint 05/15/2013
The Drugs at the Heart of Our Pricing Crisis
The US drug pricing system is broken, but not irreparable. For large-molecule biologic drugs, enter: Production Plus Profit Pricing (P-quad, pronounced like Ahab's seagoing vessel).
NYTimes 03/15/2021
Biosimilars: Market Changes do not equal policy success
Numerous articles and reports have trumpeted biosimilar market growth, but it's critical we do not lose sight of the sole objective for creating the biosimilar market: to reduce the cost of older biologic drugs for society and taxpayers.
Drug Pricing Lab 03/15/2021
Bottom-Up Pricing Estimate for P-quad
How much would biologic drugs cost under P-quad pricing? Two approaches to estimating fully loaded costs plus a profit (10% and 20% examined) suggest net discounts from current prices would be at least 65% to 75%
Drug Pricing Lab 03/12/2021
Modeling P-quad
The Drug Pricing Lab engaged Milliman to conduct an independent analysis of the Production Plus Profit Pricing (P-quad) policy proposal. The Milliman analysis estimates the projected spending on U.S. biologic and biosimilar drugs under a referent scenario where there is no biosimilar entry or competition, the existing ‘status quo’ scenario under the current biosimilar environment, and the Drug Pricing Lab’s P-quad policy proposal. 

This report was commissioned by Drug Pricing Lab.
Milliman 03/12/2021
Ethics of Clinical Trials to Evaluate Biosimilars
Biosimilars require extensive, expensive, and time-consuming human testing prior to market entry, a process vastly different than generics. So why are we still doing them?
MedRx IV 03/09/2021
COVID-19 Reduced Average Life Expectancy of Americans by Five Days,…
The CDC made a mistake.
STAT 02/25/2021
Instead of debating 'first-shot' vs 'set-aside' vaccine approaches, hospitals' study…
Hospitals could start studies of their own employees to answer important questions, including whether the first-shot approach has downsides when compared to the set-aside strategy.
STAT 01/04/2021
After 4 Years of Trump, Medicare and Medicaid Badly Need…
Many promising ideas won't work as expected, and that's all the more reason for CMS to evaluate how medical care is delivered to its patients.
NYTimes 12/01/2020
Trump's Drug-Pricing Ideas Would Cost Taxpayers a Bundle
Meanwhile, pharmaceutical companies would stand to make a lot more money.
Bloomberg Opinion 09/29/2020
We can't tackle the pandemic without figuring out which Covid-19…
There may be several Covid-19 vaccines by winter, but there will also need to be a study comparing the viruses to one another as part of rolling out widespread vaccination.
STAT 09/24/2020
Newsletter

Stay up to date on our work and news