Molly Jenkins, Director of Public Affairs at the Pharmaceutical Research and Manufacturers of America (PhRMA), has raised concerns about the accountability of hospitals in the 340B Drug Pricing Program. In a blog post, Jenkins said that these hospitals face no accountability for how they use profits gained from marking up discounted drugs.
“Despite 340B hospitals purchasing medicines at significantly reduced prices, there’s no oversight or accountability for how they use profits from the big markups they charge,” said Jenkins.
The Government Accountability Office (GAO) reported that the 340B Drug Pricing Program, established in 1992 to assist providers serving low-income and uninsured patients, has encountered issues with oversight and transparency. The report expressed concerns that some hospitals might be using the program for financial gain without passing benefits on to patients. GAO recommended that the Health Resources and Services Administration enhance monitoring and ensure compliance.
According to a 2022 update by the Berkeley Research Group, hospitals participating in the 340B program charged a relative markup of nearly 500% on outpatient medicines. The report found that these hospitals acquired medicines at significantly discounted prices and then billed commercial payers at rates well above acquisition costs. These pricing practices contribute to substantial hospital revenue, often without direct benefit to patients.
PhRMA highlighted that in Pennsylvania, 67 hospitals participate in the 340B program. Between 2014 and 2022, these hospitals experienced a 20% increase in assets while charity care provided decreased by 36%. Notably, 92% of these hospitals offered charity care at levels below the national average of 2.5% of total operating costs.
Jenkins serves as Director of Public Affairs at PhRMA, focusing on communication strategies related to healthcare cost and value. She previously worked in issue advocacy and held communication roles with Representative Greg Walden and the House Energy and Commerce Committee. Jenkins holds an M.A. in Health Communication from Johns Hopkins University.
