About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline
LOG IN
LOG IN

GAO-23-106095 1 (2023-05-11)

handle is hein.gao/gaoopd0001 and id is 1 raw text is: U.S. GOVERNMENT ACCOUNTABILITY OFFICE 441 G St. N.W. Washington, DC 20548 May 11, 2023 The Honorable Cathy McMorris Rodgers Chair Committee on Energy and Commerce House of Representatives 340B Drug Discount Program: Information about Hospitals That Received an Eligibility Exception as a Result of COVID-19 Dear Madam Chair: The 340B Drug Pricing Program (340B Program) requires drug manufacturers to sell outpatient drugs at discounted prices to covered entities (including certain types of hospitals) for the manufacturers' drugs to be covered by Medicaid.1 According to the Health Resources and Services Administration (HRSA), the agency that administers the 340B Program, the purpose of the program is to enable covered entities to stretch scarce federal resources to reach more eligible patients and provide more comprehensive services.2 In addition to realizing savings through 340B price discounts, covered entities can generate revenue when purchasing 340B drugs for eligible patients whose insurance reimbursement exceeds the 340B price paid for the drugs. The statute authorizing the 340B Program does not dictate how covered entities should use this revenue or require discounts on the drugs to be passed along to patients. More than 2,600 hospitals were participating in the 340B Program as of January 2023. To be eligible for the program, hospitals must meet various criteria, which may include treating a disproportionate number of low-income Medicare and Medicaid patients, as measured by the hospital's disproportionate share hospital (DSH) adjustment percentage.3 Enacted in March 2022, the Consolidated Appropriations Act, 2022, allowed hospitals that were covered entities participating in the 340B Program on January 26, 2020, to request from HRSA a temporary 142 U.S.C. § 256b. Medicaid is a joint federal-state program that finances health care for certain low-income and medically needy populations. 2Because the statute does not explicitly state the purpose of the 340B Program, HRSA bases this view on language in a House Energy and Commerce Committee Report pertaining to language similar to what eventually became section 340B of the Public Health Service Act. See H. Rep. No. 102-384, Pt. 2, at 12 (1992) (discussing bill to amend the Social Security Act). See also Veterans Health Care Act of 1992, Pub. L. No. 102-585, § 602(a), 106 Stat. 4943, 4967 (adding section 340B to the Public Health Service Act). 3A hospital's DSH adjustment percentage is generally based on its DSH patient percentage, which is determined by a calculation of the sum of two other percentages: (1) the low-income Medicare patient percentage, calculated as the ratio of Medicare Supplemental Security Income inpatient days to total Medicare inpatient days; and (2) the Medicaid patient percentage, calculated as the ratio of Medicaid, non-Medicare inpatient days to total inpatient days. Medicare is the federal program that provides coverage of health care services for individuals age 65 and older, certain individuals with disabilities, and individuals with end-stage renal disease. GAO-23-106095 340B Drug Discount Program Page 1

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Contact us for annual subscription options:

Contact Us

Already a HeinOnline Subscriber?

Log In

profiles profiles most