Don’t divert money out of federal program meant to lower prescription prices

Focus on finding ways to substantially reduce the number of pharmacy deserts in Illinois.

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Pat Wellenbach/AP

The intent of most of the government-run health care programs and services we have is to help people with real needs better access and better afford health care.

Unfortunately, whenever there is a pile of money on the line, outside interests try to find ways to get access to the cash, and what begins as a sincere effort to help regular people ends up helping increase profits for businesses.

One of the most egregious examples of this sordid cash grab is the 340B program.

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The federal 340B Drug Pricing Program was created in 1992. It requires drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at significantly reduced prices. The intent of the program is to allow these covered entities to “stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.”

Not-for-profit hospitals have taken advantage of the vague eligibility requirements for 340B, and they have been buying up community care centers and converting them into 340B-eligible offsite hospital outpatient departments. As a result, the 340B program facilities have grown from 90 charity care hospitals to more than 2,000, and only a handful of these facilities use the prescription savings for charity care.

According to one report, less than one-third of the contract pharmacies affiliated with the 340B discount program are located in medically underserved areas. Not surprisingly, the majority (75%) of 340B contract pharmacy arrangements are with for-profit chain pharmacies. And according to the GAO, the five top pharmacies — CVS, Walgreens, Walmart, Rite-Aid and Kroger — comprise 60% of 340B contract pharmacies, even though they represent only a combined 35% of all pharmacies nationwide.

So-called “pharmacy deserts” are areas where access to pharmacies is limited. The majority of these pharmacy deserts are in Black and Hispanic neighborhoods, according to Health Affairs, and only one in four of the pharmacies serving these neighborhoods participates in the 340B discount program.

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Here in Illinois, there are legislative efforts underway to address the concerns associated with the 340B discount program. My hope is that a bill can be crafted that puts the interest of the patient first.

The 340B program was created as a way to provide low-income patients access to prescription medication. It was never intended to be a lucrative source of revenue.

Whatever actions we as lawmakers end up taking as it relates to the 340B program, we must make absolutely certain the discount benefits get to the people who need it the most. Instead of lining the pockets of corporations, we should be focused on finding ways to substantially reduce the number of pharmacy deserts in Illinois.

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