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Credit: Petr Kratochvil
A federal program designed to help the poor may actually be used to help US hospitals increase their profits, according to research published in Health Affairs.
Researchers examined enrollment in the 340B program, which provides deep discounts on outpatient drug purchases.
They found that hospitals and clinics that joined the program since 2004 currently serve more affluent and well-insured communities than those that qualified for the program in previous years.
This supports the idea that the program is changing from one that serves patients in need to one that enriches hospitals and their affiliated clinics, according to the researchers.
“This study provides the first nationally representative empirical evidence suggesting that the program’s original intent is being eroded by the actions of certain hospitals,” said study author Rena M. Conti, PhD, of the University of Chicago in Illinois.
This study follows work by Dr Conti and Peter B. Bach, MD, of Memorial Sloan-Kettering Cancer Center in New York, that was published in JAMA last year.
The JAMA study explained how 340B-qualified hospital-affiliated clinics can boost profits thanks to discounts on expensive anticancer drugs. The facilities receive the discounts under the expectation that the savings will be passed on to poor patients.
“Hospitals qualify for the program based on the poverty of their inpatient census only,” Dr Conti said. “The affiliated clinics are the only 340B institutions not required to pass the discounts off to patients or their insurers, nor do they have to report to the government exactly how these profits are used to serve the poor. Insurers’ and their patients’ payments for outpatient drug treatment don’t reflect the discounts the hospital receives.”
The 340B program, which began in 1992, was designed to help selected hospitals and their outpatient clinics serve low-income and uninsured patients by providing discounts of 30% to 50% on outpatient drugs.
About a decade ago, enrollment in 340B began to increase rapidly. Now, more than a third of the 4375 US non-federal hospitals are 340B-qualified. Recent Congressional and news reports suggest that, for selected hospitals, profits off the 340B program can be significant.
For their new study, Drs Conti and Bach examined the populations served by hospitals and clinics qualifying for 340B before and after the decade-long growth spurt. They matched data for all hospitals and clinics registered with the 340B program to socioeconomic data from the US Census Bureau.
The results showed that communities served by hospital-affiliated clinics joining the program in 2004 or later tended to have higher household incomes, much less unemployment, and higher rates of health insurance.
The researchers said their findings are consistent with recent complaints that, rather than serving vulnerable communities, the 340B program is being used to increase profits for hospitals and their affiliated clinics. 
Credit: Petr Kratochvil
A federal program designed to help the poor may actually be used to help US hospitals increase their profits, according to research published in Health Affairs.
Researchers examined enrollment in the 340B program, which provides deep discounts on outpatient drug purchases.
They found that hospitals and clinics that joined the program since 2004 currently serve more affluent and well-insured communities than those that qualified for the program in previous years.
This supports the idea that the program is changing from one that serves patients in need to one that enriches hospitals and their affiliated clinics, according to the researchers.
“This study provides the first nationally representative empirical evidence suggesting that the program’s original intent is being eroded by the actions of certain hospitals,” said study author Rena M. Conti, PhD, of the University of Chicago in Illinois.
This study follows work by Dr Conti and Peter B. Bach, MD, of Memorial Sloan-Kettering Cancer Center in New York, that was published in JAMA last year.
The JAMA study explained how 340B-qualified hospital-affiliated clinics can boost profits thanks to discounts on expensive anticancer drugs. The facilities receive the discounts under the expectation that the savings will be passed on to poor patients.
“Hospitals qualify for the program based on the poverty of their inpatient census only,” Dr Conti said. “The affiliated clinics are the only 340B institutions not required to pass the discounts off to patients or their insurers, nor do they have to report to the government exactly how these profits are used to serve the poor. Insurers’ and their patients’ payments for outpatient drug treatment don’t reflect the discounts the hospital receives.”
The 340B program, which began in 1992, was designed to help selected hospitals and their outpatient clinics serve low-income and uninsured patients by providing discounts of 30% to 50% on outpatient drugs.
About a decade ago, enrollment in 340B began to increase rapidly. Now, more than a third of the 4375 US non-federal hospitals are 340B-qualified. Recent Congressional and news reports suggest that, for selected hospitals, profits off the 340B program can be significant.
For their new study, Drs Conti and Bach examined the populations served by hospitals and clinics qualifying for 340B before and after the decade-long growth spurt. They matched data for all hospitals and clinics registered with the 340B program to socioeconomic data from the US Census Bureau.
The results showed that communities served by hospital-affiliated clinics joining the program in 2004 or later tended to have higher household incomes, much less unemployment, and higher rates of health insurance.
The researchers said their findings are consistent with recent complaints that, rather than serving vulnerable communities, the 340B program is being used to increase profits for hospitals and their affiliated clinics.
Credit: Petr Kratochvil
A federal program designed to help the poor may actually be used to help US hospitals increase their profits, according to research published in Health Affairs.
Researchers examined enrollment in the 340B program, which provides deep discounts on outpatient drug purchases.
They found that hospitals and clinics that joined the program since 2004 currently serve more affluent and well-insured communities than those that qualified for the program in previous years.
This supports the idea that the program is changing from one that serves patients in need to one that enriches hospitals and their affiliated clinics, according to the researchers.
“This study provides the first nationally representative empirical evidence suggesting that the program’s original intent is being eroded by the actions of certain hospitals,” said study author Rena M. Conti, PhD, of the University of Chicago in Illinois.
This study follows work by Dr Conti and Peter B. Bach, MD, of Memorial Sloan-Kettering Cancer Center in New York, that was published in JAMA last year.
The JAMA study explained how 340B-qualified hospital-affiliated clinics can boost profits thanks to discounts on expensive anticancer drugs. The facilities receive the discounts under the expectation that the savings will be passed on to poor patients.
“Hospitals qualify for the program based on the poverty of their inpatient census only,” Dr Conti said. “The affiliated clinics are the only 340B institutions not required to pass the discounts off to patients or their insurers, nor do they have to report to the government exactly how these profits are used to serve the poor. Insurers’ and their patients’ payments for outpatient drug treatment don’t reflect the discounts the hospital receives.”
The 340B program, which began in 1992, was designed to help selected hospitals and their outpatient clinics serve low-income and uninsured patients by providing discounts of 30% to 50% on outpatient drugs.
About a decade ago, enrollment in 340B began to increase rapidly. Now, more than a third of the 4375 US non-federal hospitals are 340B-qualified. Recent Congressional and news reports suggest that, for selected hospitals, profits off the 340B program can be significant.
For their new study, Drs Conti and Bach examined the populations served by hospitals and clinics qualifying for 340B before and after the decade-long growth spurt. They matched data for all hospitals and clinics registered with the 340B program to socioeconomic data from the US Census Bureau.
The results showed that communities served by hospital-affiliated clinics joining the program in 2004 or later tended to have higher household incomes, much less unemployment, and higher rates of health insurance.
The researchers said their findings are consistent with recent complaints that, rather than serving vulnerable communities, the 340B program is being used to increase profits for hospitals and their affiliated clinics.