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340B Program in the Crosshairs: What the Next Few Months May Bring

This Briefing is brought to you by AHLA’s In-House Counsel Practice Group.
  • November 25, 2020
  • James Junger , Hall Render Killian Heath & Lyman PC
  • Todd A. Nova , Hall Render Killian Heath & Lyman PC

In 1992, Congress created the 340B Drug Discount Program (340B Program) to help safety net hospitals and grant-funded clinics stretch the scarce federal resources available to them. Under the 340B Program, these providers (Covered Entities), can purchase covered outpatient drugs at the same reduced rate as state Medicaid agencies. In accordance with longstanding guidance from the Health Resources and Services Administration (HRSA), Covered Entities have contracted with pharmacies to provide drugs to Covered Entity patients, advancing Congress’ goal of “reaching more eligible patients and providing more comprehensive services.” 340B Program savings realized through contract pharmacy models are a crucial source of financial stability for many Covered Entities without which many would have to cut significant services or even be forced to close.

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