Healthcare Economist March 30, 2020
I have written about the 340b program a number of times on this blog in the past (e.g., “The 340B Program: An Overview“, “340B Facts and Figures“). A new commentary by Thomas and Schulman (2020) in Health Services Research provides some additional information.
For instance, why was 340B originally enacted? Blame the Medicaid Drug Rebate program enacted as part of the 1990 Omnibus Budget Reconciliation Act (OBRA):
Prior to OBRA, pharmaceutical companies often made special discounts available to safety-net hospitals to support their charitable and uncompensated care. Once the Medicaid Drug Rebate Program was in place, safety-net providers found that pharmaceutical firms would no longer sell products at deeply discounted prices because the safety-net prices would inadvertently serve as...