Debra Pratt and Jeff Vacirca   |   March 13, 2017

Defenders of the 340B Drug Discount Program say it is vital to safety net hospitals and the patients they serve. On that, we agree wholeheartedly. The program was originally intended by Congress to provide assistance to those treating uninsured or underinsured patients so that this vulnerable population had access to medical treatment. However, inadequate oversight has distorted the noble intent of 340B, transforming it into a perverse profit generator for many of America’s tax-exempt hospitals, few of which provide any meaningful level of charity care.

Few 340B hospitals provide meaningful charity care

Though some 340B hospitals provide substantial charity care consistent with Congressional intent, the data show that the vast majority do not. A 2016 report by Avalere Health found that only 24 percent of 340B hospitals provide 80 percent of all the charity care, despite representing less than half the beds available in the program. The same report also noted 37 percent of 340B hospitals provided charity care representing less than 1 percent of total patient costs.

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