| Community health centers reinvest all savings from the 340B program into providing affordable medication and services for patients. Recently, third parties including drug manufacturers, Pharmacy Benefit Managers, and insurers have been engaging in practices that allow them to retain savings that are intended for health centers. This practice is known as discriminatory reimbursement or ‘pick-pocketing.' |
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| Several states, including Tennessee have passed legislation to prohibit third parties from engaging in practices that prevent health centers from benefiting from 340B savings. However, there is nothing in the federal 340B statute that prevents those practices. |
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| What is the PROTECT 340B Act of 2021? |
| Representatives Spanberger (D-VA) and McKinley (R-WV) introduced legislation, H.R. 4390, the PROTECT 340B Act of 2021 to prohibit Pharmacy Benefit Managers (PBMs) and insurers from engaging in ‘pick-pocketing.' |
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The legislation would prevent these third parties from retaining savings from 340B medications for patients covered by private insurance and Medicare Parts C and D. The bill prohibits the following:
- Treating 340B providers and their contract pharmacies differently from other similarly situated providers and pharmacies with regards to:
- Reimbursement
- Fees (including professional dispensing fees), adjustments, etc.
- Participation in standard or preferred networks
- Audits and inventory management systems
- Interfering inpatients' choice to receive drugs from a 340B pharmacy, whether in person or my mail.
- Requiring 340B providers or pharmacies to identify 340B drugs, other than for Medicaid purposes.
- Refusing to contract with a 340B provider or their contract pharmacy.
- Imposing “Any other restrictions, conditions, practices, or policies that, as specified by the Secretary through rulemaking, interfere with the ability of a covered entity to maximize the value of discounts provided under section 340B”.1
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| How You Can Help |
| Members of Congress may not be aware of how pervasive discriminatory reimbursement practice have become and much they interfere with health centers' ability to care for their patients. Educating Members of Congress on these practices is the first step in garnering support for the PROTECT 304B Act of 2021. To ultimately ensure these critical federal protections become law we must also encourage our members of the House of Representatives to support health centers by becoming a co-sponsor of the legislation. |
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| To learn more about how you can advocate for 340B protections, check out these 340B resources from the National Association of Community Health Centers (NACHC). |
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| [1] The PROTECT 340B Act Of 2021 Advocacy Toolkit. 2021. National Association of Community Health Centers. |
