February 9, 2024
Senate’s Gang of Six Unveils Draft Legislation and Requests Information to Reform the 340B Program
Last week, a bipartisan group of six senators who have traditionally supported the 340B program — Sens. John Thune (R-SD), Debbie Stabenow (D-MI), Shelley Moore Capito (R-WV), Tammy Baldwin (D-WI), Jerry Moran (R-KS.), and Ben Cardin (D-MD) — released draft legislation to reform the program. While the goal of the Senators is to pass legislation this year to “provide clarity, transparency, and accountability in the 340B program,” it remains uncertain whether that will happen given the presidential elections and Congress’ current long list of to-dos. The Senators also included a Request for Information (RFI) (comments due April 1st) with questions on various topics such as contract pharmacy discrimination, additional reporting, and the potential creation of a new User Fee Program. For a summary of the RFI, click here. Below are key details of the draft legislation.
Contract Pharmacies. Covered entities would be permitted to use contract pharmacies and manufacturers would be prohibited from imposing any restrictions on contract pharmacy use.
Transparency. The legislation would require covered entities to report, and the Health Resources and Services Administration (HRSA) to publish, specific information about how 340B entities are using the savings of the program. It would require entities to report the number of individuals who were dispensed or administered 340B drugs, charity care costs, patient demographics, contract pharmacies used, and the total discount received under the program.
Requirements for Child Sites. All child sites would be subject to new requirements to ensure that the child site is “closely related to the 340B covered entity,” such as unified financial assistance policies, common ownership and governance, common staffing, and integrated medical records systems.
340B User Fee Program. The legislation would create a new 340B user fee program to help fund the program’s administration. HRSA would collect those user fees from 340B covered entities only.
Patient Definition. The draft legislation doesn’t include a definition for “patient,” but it leaves a placeholder for a section on it. The RFI identifies this area as one for which the Senators seek more information and includes a number of specific questions for feedback.
Establishment of National Clearinghouse to Prevent Duplicate Discounts. The legislation would require the Secretary of HHS to enter into a contract with an independent, third-party entity to serve as a national clearinghouse to prevent duplicate discounts.
New Requirements for Insurers. The legislation would prohibit commercial insurers from adjusting reimbursement to account for 340B status.