Affordable Prescription Drugs

Federal policymakers have identified rising drug costs as a major national problem. They are holding hearings and analyzing data about prescription drug pricing and working to identify policy solutions to lower costs for American patients. Hospitals are directly impacted by the major increases in prescription drug costs for inpatient and outpatient care. Hospitals also help patients deal with the financial burden of rising drug costs.

Recent reports on inpatient drug costs and trends in hospital drug spending and shortages address the impact on hospital budgets and operations, and patient access to care. Key findings:

  • The average total drug spending per hospital patient admission increased 18.5 percent between fiscal years 2015 and 2017
  • More than 90 percent of surveyed hospitals reported having to identify alternative therapies to ease the burden of higher drug prices and drug shortages

HAP supports the American Hospital Association’s work to advance policy solutions that address ever-increasing drug prices. Those solutions include:

  • Stopping brand-name manufacturers’ anticompetitive actions/ passing the CREATES Act to allow generic drug manufacturers to take legal action if they face such actions
  • Speeding up generic drug approvals
  • Strengthening manufacturers’ drug shortage disclosure requirements
  • Developing drug shortage plans
  • Motivating drug companies to produce drugs in shortage/address delays
  • Encouraging early drug shortage alerts to lessen the risks to patients

Both the U.S. House and U.S. Senate are seeking to advance legislation to address drug prices. Leading proposals include legislation crafted by U.S. House Speaker Nancy Pelosi, H.R. 3, the Lower Drug Costs Now Act, and a bipartisan package approved by the Senate Finance Committee in July, S.2543, the Prescription Drug Pricing Reduction Act (PDPRA).

HAP is working with the Pennsylvania Congressional Delegation to convey the hospital community’s perspectives and priorities around rising drug costs and drug shortages.

340B Drug Pricing Program and Good Stewardship Pledge

The 340B Drug Pricing Program is an effective tool that the hospital community has used to help manage the impact of high cost drugs through discounted medications from drug manufacturers. Savings are used to care for more patients, improve services and build healthier communities, or help patients secure prescription drugs at significantly reduced costs, or no cost at all. A 2018 Medicare regulation implemented reductions in the amount of the savings hospitals can recoup and reinvest in health care. 

The 2020 final rule for the Medicare Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment System and quality reporting programs continues to reduce hospital reimbursement by maintaining a nearly 30 percent pay cut to certain participants in the federal 340B Drug Pricing Program, despite a federal judge's ruling against the reductions during both 2018 and 2019. 

All 340B hospitals are urged to adopt the 340B Good Stewardship Pledge. Hospitals that commit to 340B Good Stewardship will: communicate the value of the program, disclose estimated savings, and adhere to rigorous internal oversight.

This presents an important opportunity to increase transparency and better communicate the value of this crucial program.

Adopt the 340B Good Stewardship Pledge today.

HAP Contacts

For more information, contact Laura Stevens Kent, senior vice president, strategic integration. For media inquiries, contact Rachel Moore, director, media relations.

HAP News

September 04, 2020

U.S. House Leaders Press HHS to Stop Drug Companies from Undermining the 340B Program

Yesterday, Energy and Commerce Chairman Frank Pallone, Jr. (D-NJ), Health Subcommittee Chair Anna G. Eshoo (D-CA), and Oversight and Investigations Subcommittee Chair Diana DeGette (D-CO) sent a letter to U.S. Health and Human Services (HHS) Secretary Alex Azar expressing strong concerns about recent actions taken by drug manufacturers that undermine the 340B Drug Pricing Program.

July 07, 2020

Bipartisan Group of U.S. Senators Unveil Legislation to Maintain 340B Eligibility during COVID-19 Pandemic ​

A bipartisan group of U.S. Senators last week introduced legislation to help hospitals that participate in the 340B Drug Pricing Program maintain eligibility during the COVID-19 pandemic. The bill would allow hospitals to remain eligible for the program throughout the COVID-19 pandemic, even if their inpatient volumes fall below the benchmarks set by the federal government.