340B Spotlight: Despite access to discounts, many 340B hospitals fail to comply with ACA charity care requirements

Late last year, we highlighted a study published in in the New England Journal of Medicine that found many nonprofit hospitals were not complying with the charity care requirements laid out in the Affordable Care Act (ACA). Now, a new report released by the Alliance for Integrity and Reform of 340B (AIR340B)—of which PhRMA is a member—expands on this research and compares charity care compliance rates at 340B and non-340B hospitals. The report from the Berkeley Research Group (BRG) found 340B and non-340B hospitals had similar charity care compliance rates, even though in 2015 alone 340B hospitals received almost $4 billion in additional financial benefits through access to discounted medicines.

ACA requires hospitals to self-report on five charity care requirements, including written charity and emergency care policies, notifying patients of financial assistance policies and conducting a community health needs assessment in the last three years. Unfortunately, only 37 percent of 340B hospitals limited their charges for patients eligible for charity care and less than 62 percent of 340B hospitals regularly notified patients of potential charity care eligibility before sending bills to collections agencies or engaging in certain other tactics to obtain payments.

The 340B program was created to help vulnerable or uninsured patients access needed medicines. But these data offer further evidence the 340B program may not be reaching those in need.

For more on 340B, check out our latest 340B Spotlight posts.