October 7, 2014—Hospitals groups have responded forcefully to a new study in the journal Health Affairs that its authors say supports the position that disproportionate share hospitals increasingly use 340B savings to help themselves at the expense of the poor. [ms-protect-content id=”2799″]
In a reply article submitted for publication in the Health Affairs blog, Safety Net Hospitals for Pharmaceutical Access says the study “neglects an essential point: compared to non-340B DSH hospitals, 340B DSH hospitals provide over twice as much care to Medicaid and low-income Medicare patients, and almost twice as much uncompensated care.” SNHPA represents more than 1,000 hospitals enrolled in the drug discount program.
“340B DSH hospitals across the board provide high levels of uncompensated care,” SNHPA’s response continues. “For these and other reasons … the article does not support the criticism that 340B DSH hospitals are no longer serving vulnerable patients.” The article is expected to be published in the Health Affairs blog tomorrow, Oct. 8.
The American Hospital Association also took strong issue with the study. In its AHAStat blog, the group said the report “does a real disservice to this important program that has a proven track record in helping patients get the medicines they need.”
“The 340B program accounts for only two percent of the $325 billion in annual drug purchases made in the U.S., or roughly $6.5 billion,” the AHA said. “Hospitals participating in the 340B program provided $28.4 billion in uncompensated care in 2012 – in other words – four times the drug purchase amount. Furthermore, the uncompensated care provided by hospitals in the 340B program represented 62 percent of all uncompensated care provided by America’s hospitals in 2012.”
The study in Health Affairs, by Rena Conti of the University of Chicago and Peter Bach of Memorial Sloan Kettering Cancer Center, is entitled “The 340B Drug Discount Program: Hospitals Generate Profits by Expanding to Reach More Affluent Communities.”
Conti and Bach say their data analysis shows that “beginning around 2004, newly registered 340B DSH hospitals have tended to be in higher-income communities” than hospitals that enrolled before, and that their outpatient clinics have tended to be in locations “with lower poverty rates and higher mean and median income levels” than their 340B DSH parent hospitals.
“These results suggest that the expansions among 340B DSH hospitals run counter to the program’s original intention,” which the authors say “was to give assistance to low-income and uninsured patients.”
Among other points in its rebuttal, SNHPA observed that
- “Conti and Bach misconstrue the 340B program’s intent. 340B is not – and never was – a direct assistance program for the poor.
- Their study neglected to take account of widely documented trends unrelated to 340B that are causing hospital outpatient clinics to grow in number. “There is no way to meaningfully determine whether 340B is driving an increase in hospital offsite locations” without evaluating “whether these trends are leading 340B DSH hospitals to establish more outpatient clinics than non-340B DSH hospitals.
- Conti and Bach “did not look at whether the hospital outpatient clinics in their study were established before or after hospitals joined the 340B program. To conclude that 340B gives hospitals incentives to open such clinics, at the very least, Conti and Bach must show that the clinics were added only after their respective hospitals enrolled in the program.”
In a May 2013 opinion article in JAMA, Conti and Bach said some hospitals were earning “windfall” profits on cancer drugs purchased through 340B ” that might not be directly benefiting the poor.” Conti was a featured speaker at the drug industry-led group AIR 340B’s “national summit” on the drug discount program this past June. [/ms-protect-content]