Study: 340B Hospitals Provide Nearly Twice as Much Care to the Poor as Other Hospitals

by admin | June 3, 2015 10:19 am

June 3, 2015—340B disproportionate share hospitals provide nearly twice as much care to poor patients as non-340B hospitals and bear a much higher burden of uncompensated care, a new study has found. [ms-protect-content id=”2799″]

The study[1], by the healthcare economics and policy consulting firm Dobson DaVanzo & Associates, sought to determine the extent to which DSH hospitals in the 340B program focus their services on low-income patients in comparison with hospitals not enrolled in 340B. 340B Health, which represents hospitals in the drug pricing program, commissioned the research.

The study found:

• As a percentage of total patient care costs, 340B DSH hospitals provide nearly twice as much care as non-340B hospitals – 41.9 percent versus 22.8 percent – to Medicaid beneficiaries and low-income Medicare patients eligible for Supplemental Security Income payments.

• 340B hospitals provide nearly 30 percent more uncompensated care than non-340B hospitals – $24.6 billion versus $17.5 billion. Although 340B hospitals made up only 35 percent of all hospitals included in the analysis, 340B hospitals provided 58 percent of all uncompensated care. 340B hospitals also provided more uncompensated care on an average, per facility basis ($26.2 million for 340B hospitals vs. $10 million for non-340B hospitals). In addition, when taking hospital size into account and looking at uncompensated care as a percent of total patient care costs, 340B hospitals across all hospital sizes provided consistently high levels of uncompensated care.

• A higher percentage of 340B DSH hospitals provide public health and specialized services – many of which are unprofitable but essential to their communities – than other hospitals. This includes labor and delivery room, trauma, HIV/AIDS, and psychiatric services.

“Three metrics have been used in the literature to describe safety-net hospitals: 1) provision of services to vulnerable populations, 2) a disproportionate amount of uncompensated care, and 3) type of care provided,” said the study report’s author, Joan DaVanzo. “Our analyses found that hospitals participating in the 340B program surpass non-340B hospitals on all three criteria, regardless of size.”

“Some in the pharmaceutical industry have questioned whether 340B hospitals truly serve the needy and whether they belong in the program. This report provides clear and unequivocal evidence that the answer is yes,” said Ted Slafsky, President and CEO of 340B Health.

Drug manufacturers’ complaints about 340B revolve overwhelmingly around DSH hospital participation in the program. Last month, in the days leading up to its vote on the 21^st Century Cures Act, the House Energy & Commerce Committee circulated draft 340B legislation focused mainly on DSH hospitals. The draft was put forward as a possible basis for a 340B amendment to the Cures bill, but in the end no such amendment was offered[2]. Among other elements, the draft language touched on 340B’s intended purpose; the 340B patient definition; contract pharmacy; audits; penalties for noncompliance; information collection and reporting requirements; and DSH hospital eligibility.

340B Health and other hospital groups have been urging Congress to let the Health Resources and Services Administration issue 340B program omnibus guidance before considering passing any 340B legislation. HRSA appears to remain on track to publish such guidance this summer[3]. [/ms-protect-content]

Source URL: https://340bemployed.org/study-340b-hospitals-provide-nearly-twice-as-much-care-to-the-poor-as-other-hospitals/

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