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How The Hospital Industrial Complex Robs Poor Patients
Pharmaceutical leader Johnson & Johnson recently unleashed a firestorm in Washington after it proposed a change to how it offers discounted prices on two drugs in a little-known, but enormous, federal program that's hurting the low-income patients it was created to help.That program, known as the "340B Drug Pricing Program," allows certain hospitals—and their affiliated clinics and pharmacies—to access medicines at significantly lower prices offered by pharmaceutical manufacturers.To help ensure that 340B discounts are being obtained lawfully and benefit the low-income patients they're intended for, J&J proposed offering such discounts as retroactive rebates—rather than upfront discounts—for a subset of 340B hospitals on two of its medicines. This change was intended to help bring much-needed transparency to the 340B program.
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Officials at the Health Resources and Services Administration (HRSA), who run the program, blew a gasket. HRSA, whose mission is to provide "equitable health care to the nation's highest-need communities," effectively announced that unless J&J backed down, the agency would kick the drug maker out of Medicare and Medicaid.J&J has now decided to forgo implementation. But the concerns the company raised are wholly appropriate. Because the alleged behavior of many 340B hospitals is well-documented by government oversight agencies, raises patient and taxpayer costs, and boosts hospital profits, the current iteration of 340B
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