Get to Know 340B: Congressional Action

The 340B program ensures health centers can provide comprehensive care and affordable medications to patients. Read on to learn more about what Congress can do to protect this vital program.
The federal 340B drug pricing program allows health centers to purchase outpatient medications at a discount and invest the savings into patient care. Savings from the 340B program ensure health centers can provide affordable medications and comprehensive services to all patients, regardless of their ability to pay.  
Restrictions on Contract Pharmacies 
Beginning in 2020, several major drug manufacturers started imposing restrictions on contract pharmacies by refusing to ship 340B-priced medications to them or making shipments contingent on submissions of claims data. Seven drug manufacturers now impose restrictions on health centers' contract pharmacies. Manufacturers typically only allow 340B-priced medications to be shipped to one contract pharmacy per health center, and only if the health center does not have an in-house pharmacy. According to a report from the National Association of Community Health Centers (NACHC), a little more than half, 56% of health centers have in-house pharmacies and 86% of health centers rely on contract pharmacies.1 
What actions is Congress taking to address contract pharmacy restrictions? 
Since drug manufacturers began restricting the use of contract pharmacies, Congress has responded by sending multiple bi-partisan letters to the U.S. Department of Health and Human Services (HHS), expressing concerns about actions by drug manufactures and urging HHS to begin fining drug manufacturers for the contract pharmacy restrictions. The most recent letter closed on July 14 with 181 signatures. Several Tennessee House members including Representatives Tim Burchett (R-2), Chuck Fleischmann (R-3), John Rose (R-6), and Steve Cohen (D-9) signed on. There is currently no legislation in Congress that would protect contract pharmacies. However, Congress could pass a bill that would amend the 340B statute to clarify the use of contract pharmacies.2 
Discriminatory Reimbursement 
Third parties, such as insurers and PBMs are engaging in practices that allow them to retain 340B savings that are intended for health centers. These practices are known as discriminatory reimbursement or ‘pick-pocketing' since third parties are ultimately taking savings away from health centers.  

In 2021, Representatives Abigail Spanberger (D-VA) and David McKinley (R-WV) introduced the PROTECT 340B Act. The bill would prohibit insurers and PBMs engaging in ‘pick-pocketing' by prohibiting third parties from treating health centers differently than other providers when it comes to reimbursement, fees, contracting, and auditing practices. The bill also includes a third-party clearinghouse that would address transparency concerns from drug manufactures when it comes to discounts under Medicaid.3 
How You Can Support the 340B Program
The PROTECT 340B Act now has more than 100 co-sponsors in the House including Tennessee's Congressman John Rose (R-6) and Congresswoman Diana Harshbarger (R-1). Although the legislation is gaining traction, we must continue to garner support to ensure passage of the only bill currently available to protect the 340B program. 

Ask your member of the House to support the PROTET 340B Act >>> 
[1]  National Association of Community Health Centers. (2022). 340B: A Critical Program for Health Centers. Retrieved from
[2] Ibid.
[3] Ibid.



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