The 340B drug discount program should be helping patients in need, not boosting pharmacy chain profits

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By Sally Greenberg, Chief Executive Officer, National Consumers League

The federal 340B drug discount program is a worthy and critical program. Created by Congress in 1992, it mandates that pharmaceutical manufacturers participating in the Medicaid program must offer prescription medicines at discounted rates to community health centers and safety-net hospitals serving low-income and uninsured patients. Over the years, this program has given vulnerable patients access to the drugs they need and freed up resources for the qualified facilities to offer more health care services to indigent communities.

Over the past decade or so, however, this valuable program has been increasingly corporatized by for profit entities known to increase costs for consumers including middlemen like pharmacy benefit managers and pharmacy chains. Too many of the dollars circulating through the 340B program are benefiting the well-off and for-profit corporations, instead of consumers with significant health and financial needs. News stories have shined a spotlight on big health systems using the program to bolster profits, while hallowing out critical resources in underserved areas. However, more attention needs to be given to the billions of 340B dollars going to major pharmacy chains like CVS, Walgreens, Walmart and Rite-Aid that are not benefiting the patients this program is intended to serve. Increasingly, however, policymakers at the federal and state level are suggesting bailing out these for-profit entities under the guides of “contract pharmacy” legislation.

Here’s the problem: In 2010, the federal government issued guidelines allowing 340B-eligible health providers to contract with for-profit retail pharmacies to dispense medications, with virtually no rules or safeguards. Since that time, the number of pharmacies participating in the 340B program has grown from 789 in 2009 to over 25,000 today. If this meant more access to affordable drugs for consumer, that would be one thing, but this has not been the case. As contract pharmacies have increased, so too has consumer challenges affording their medicines, nearly in parallel. For example:

  • Even though 340B contract pharmacies are receiving drugs at discounted prices, there is no evidence they are passing those savings onto consumers. One analysis from the respected IQVIA firm found that 340B discounts were shared with consumers in only 1.5 percent of eligible pharmacy claims.
  • Although the 340B program is intended to benefit underserved, vulnerable communities with high proportions of poor and uninsured patients, hospitals in the program are contracting with pharmacies that are not, in fact, in areas afflicted with poverty and a scarcity of health care services.
  • The vast majority of 340B contract pharmacy arrangements are with the aforementioned big national chains like CVS and Walgreens, which are enjoying enormous profits as a result of their participation in the drug discount program. Contract pharmacies collected an estimated $13 billion in gross profits in 2018, with a 72% profit margin on 340B drugs (because they are getting those drugs at a steep discount, which they don’t share with consumers). Needless to say, fattening corporate pharmacy profits should not be this program’s mission.

Contract pharmacy abuse of the 340B program has not gone unnoticed by policymakers in Washington. In January 2024, leaders in the U.S. Senate questioned CVS Health and Walgreens as part of as part of an ongoing investigation into how health care entities use and generate revenue from the 340B Drug Pricing Program. The Government Accountability Office (GAO) and the Department of Health and Human Service Office of the Inspector General (OIG), also highlighted issues with the program’s integrity as it relates to contract pharmacy use. 340B is in desperate need of transparency and oversight, not unfettered expansion.

Yet that is exactly what is happening in some U.S. states. This matter is taking on a greater urgency now as several states are contemplating legislation that doubles down on the problem instead of fixing it. Consumers would be shocked to learn their state representatives are ushering through changes that would further solidify the profitable role these large corporate contract pharmacies are playing in the abused 340B program. Policymakers at the state and federal level need to address a fundamental question – where do 340B savings go? And when the answer is to corporate pharmacy giants – not patients – it’s time to reconsider ill-conceived policies giving contract pharmacies even more access to 340B drug discounts.

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About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

Consumer struggles with Native American healthcare

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By Sam Sears, Health Policy Associate, National Consumers League

My name is Sam Sears, and I am the new Health Policy Associate working at the National Consumers League. I am excited to be working with Robin, Sally, and the rest of the staff at NCL. Consumer issues regarding health care, specifically access and confidence, are wide-reaching and I am thrilled to be able to lend my growing expertise and experience to support the cause and NCL.

I always thought I would end up in healthcare, but my younger self had always envisioned my work with a much more narrowed focus. Academically, my background is in policy and gender studies, where I focused on equal protections for women and queer, specifically related to intimate partner violence and protections and reproductive justice. After graduation, I worked as a barista while also taking placements through a temp agency here in DC, focusing on nonprofits and advocacy organizations. It was, in part, due to the temp placements that I found myself working on broader health policy issues such as the 340B Drug Pricing program and health care access for individuals.

Before joining NCL, I worked at the National Council of Urban Indian Health (NCUIH) for two years, where I was able to learn quite a bit about the healthcare delivery system for Native Americans and the barriers to access that they often face. While NCUIH’s focus is centered on ensuring that Native Americans living in urban settings have access to quality, accessible, and culturally competent health services, much of the work is done collaboratively with other advocates and organizations working within the space. Because of this, my work at NCUIH often was encompassing issues facing the larger community.

Upon joining NCL, I realized that a prominent problem for Native Americans is a much larger area of concern for all Americans and their healthcare – the pervasive and misleading Medicare Advantage plan advertisements seen on television. In fact, in a letter to Centers for Medicaid and Medicare Services (CMS) and Dr. Brooks-LaSure, the CMS Tribal Technical Advisory Group, a group of 17 representatives comprised of elected Tribal leaders or appointed representatives and representatives of national Indian organizations headquartered in DC, highlighted how Medicare Advantage (MA) plans have been “aggressive and invasive when marketing their plans”.

A Kaiser Family Foundation report on the 1,200 unique ads, mostly for MA plans, aired during the enrollment window found that 27% led beneficiaries into thinking they were being recruited for traditional Medicare plans. For Native Americans, this aggressive marketing has led people to enroll in plans that do not include local Indian Health Service providers, meaning they lose coverage and no longer able to go to the doctors they trust to care for them in a culturally competent manner. This confusion is not limited to just Native Americans, as Dr. Brooks-LaSure has stated previously.

It’s important to note that CMS has been addressing the misinformation and confusion from these ads. In April of 2023, the agency released a final rule regarding Medicare Advantage marketing and communications, amongst other Medicare part plans and related topics. Specifically, CMS must now pre-approve all television MA plan advertisements that will air during the open enrollment period, minimizing the opportunity for misinformation and predatory practices within the ads. CMS has also significantly increased its ability to investigate complaints about misleading agents and advertisements. This regulation, while large and with rolling applicability dates, will apply to the 2024 contract year for MA plan marketing and communication, meaning that the open and re-enrollment period at the tail end of the 2024 calendar year will be drastically different.

As I stated earlier, many of the issues that I had worked on while with NCUIH are also applicable to the broader population and community who struggle with access to healthcare. So, I am excited to be able to continue to work on these consumer issues with NCL. And I am eager to see how NCL could support and expand on the work I’ve been able to touch on through my other positions.

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About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

PBMs claim new programs will save consumers money. Let’s take a closer look.

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By Robin Strongin, Senior Director of Health Policy

Consumers have known for quite some time now that the prescription drug pricing system is essentially a black box. Dealings among drug manufacturers, health insurers and pharmacy benefit managers (PBMs) establish which drugs insurance will cover and make accessible to consumers. What’s more, the prices that consumers pay for those medicines vary wildly – often leading to high out-of-pocket costs for us all.

Two of the three major PBM companies that are in the middle of this drug pricing web recently announced that they are establishing new programs (CVS’s CostVantage and Express Scripts’ ClearNetwork) that set transparent formulas for drugs with a pre-set markup and a flat fee for the PBMs. On paper, this sounds like a great idea.

But consumers would be wise to take these claims with a healthy grain of proverbial salt. We know PBMs continue to find new ways to put themselves over patients (more on that here) and we must demand answers to the issues the PBMs are still skirting. For example:

  • Will these new programs actually make prescription drugs more affordable and reduce out-of-pocket costs at the pharmacy counter? Notably, both Express Scripts and CVS Health have acknowledged that employers and plan sponsors may not save any money from this move. There is no sign either that consumers will be able to get the drugs they need for a fair price.
  • While the companies boast increased transparency, they still have not shared – nor said they will share – how much they are paying to acquire the drugs that will be dispensed to patients. PBM clients have long sought this information, but it appears that data will still be hidden in the black box.
  • In the case of CVS Health, the changes the company announced will only be effective at CVS-owned pharmacies. It will not affect how CVS will reimburse millions of prescriptions at the local and independent pharmacies it doesn’t own. A cynic might say this is just another mechanism by CVS to drive more patients to its own pharmacies.

Most notably, nothing CVS Health and Express Scripts have announced will change one of the pervasive anti-consumer elements of the drug pricing system. In their dealings with drugmakers, they can still cut deals that will determine which medicines get preferential placement. This means PBMs could continue to push consumers toward higher-priced drugs and limit access to more affordable generics and biosimilars.

It’s no coincidence that Congress is getting closer to passing PBM reform legislation that would mandate transparency, force the PBMs to pass their negotiated savings from drugmakers to consumers and remove the incentives for PBMs to push consumers to higher-priced drugs. One might say that these moves by CVS and Express Scripts are cosmetic attempts to ward off legislation by touting their own self-reforms.

But, as with so much that goes on in the drug pricing game, these “reforms” may not be what they seem. We need Congress to step in for consumers to help ensure we’re no longer facing a big disadvantage at the pharmacy counter.

Learn more about the PBM problem at nclnet.org/pbms.

NCL comments regarding Proposed Rule: Medication Guides: Patient Medication Information Docket No. FDA-2019-N-5959

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November 21, 2023

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

The National Consumers League recently submitted comments regarding the Proposed Rule, Medication Guides: Patient Medication Information, that we believe will greatly improve the information patients receive with their prescription medicines.

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About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

NCL applauds the confirmation of Monica Bertagnolli as next NIH director

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November 9, 2023

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

The National Consumers League (NCL) applauds the U.S. Senate’s decision to confirm Dr. Monica Bertagnolli to be the next director of the National Institutes of Health (NIH).

This past Tuesday, the Senate voted 62-36 for Bertagnolli to take over the leadership role at NIH – a role that has been vacant for nearly two years. Preceding Bertagnolli was 2022 Trumpeter Honoree Dr. Francis Collins, who served as NIH director for more than 12 years.

“Dr. Bertagnolli brings a wealth of knowledge and experience,” said NCL CEO Sally Greenberg. “As a surgical oncologist, former director of the National Cancer Institute, and former president of the American Society of Clinical Oncology, Dr. Bertagnolli is the right person to oversee the NIH as this important agency serves a critical role in advancing public health.”

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About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

National Consumers League praises FTC’s multilingual fraud reporting announcement

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November 8, 2023

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

The National Consumers League (NCL), America’s oldest consumer advocacy organization today praised the Federal Trade Commission’s (FTC) announcement that consumers can now file fraud and identity complaints in their preferred languages. NCL is the home of the Fraud.org campaign, which is a long-time contributor of complaint data to the FTC’s Consumer Sentinel Network as well as being an ally in the Commission’s efforts to educate consumers about frauds.

The following statement is attributable to NCL Vice President of Public Policy, Telecommunications, and Fraud, John Breyault:

“All consumers are at risk of fraud, regardless of the language they speak. Making it easier for fraud victims to report these crimes in their own language to the FTC is a critically important step in the fight against scams. We are thrilled with today’s announcement and look forward to continuing to work with the Commission and our allies in the anti-fraud community to protect consumers from criminal scammers.”

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About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

Congressional briefing: The path forward for a safe cannabis marketplace

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By Robin Strongin, Senior Director of Health Policy

Cannabis Consumer Watch recently hosted a briefing on Capitol Hill to educate policymakers and staff on the public health risks that exist in the current cannabis marketplace, and to offer policy solutions that would help protect consumer safety and encourage innovation for patients. The briefing was moderated by the Collaborative for Cannabinoid Science and Safety’s Libby Baney, and the panel of experts included:

Robin Stronger, Senior Director of Health Policy, National Consumers League, who explained NCL’s biggest concerns about the current cannabis marketplace. She pointed out, “Out of over 140 CD products studied by the FDA, more than half were mislabeled and nearly 40 of those products had more than 120% of the CBD level listed. Several had pesticides and even toxic mold – we just don’t know what consumers are buying. And consumers aren’t aware of the risks.”

Dale Sutherland, President & Founder, CODE 3, who shared that during his time with DC Metropolitan Police Department, they saw, “how bad distribution efforts can be – product manufacturing and transportation conditions that aren’t heavily regulated present several unique health risks.”

Sue Thau, Public Policy Consultant, CADCA highlighted the negative effects cannabis products have on children in particular, explaining, “Poison control calls related to cannabis digestion are increasing each year – and that’s just the data that we do have – there isn’t an efficient way to track all the issues parents and families face.” She provided examples of THC products that use packaging similar to popular children’s snacks or are in packaging that appeals to kids.

From consumer health to law enforcement, to concerns around youth consumption, the unique backgrounds of the panel made for a robust conversation that included multiple perspectives on the cannabis issue. To learn more about the concerns highlighted during the discussion, visit our Cannabis 101 page here.

 

Obesity medicine specialists, health providers, insurers and employers urged to make obesity treatment a right of all Americans

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October 13, 2023

Media contact: National Consumers League – Nancy Glick, nancyg@nclnet.org, 202-823-8442 NCOA –Simona Combi, Simona.combi@ncoa.org, 571-527-3982

Washington, D.C. – With growing evidence that U.S. adults with obesity feel stigmatized and ignored by their health care providers, the National Consumers League (NCL) and National Council on Aging (NCOA) today urged health professionals, insurers and employers to join a national movement to define quality obesity care as a right for every American.

Taking the case directly to health professionals on the front lines in delivering obesity care, NCL and NCOA used The Obesity Society’s annual meeting in Dallas October 14-17 to announce plans to provide Americans with an Obesity Bill of Rights.  Today, over 100 million adults are living with obesity[1] (42 percent of the public), yet only 10 percent get help from medical professionals.[2] An Obesity Bill of Rights has the potential to transform obesity care by empowering Americans to demand the respect of their health providers and to be screened, diagnosed, and effectively treated for their obesity based on medical treatment guidelines.

“For too long, adults with obesity have encountered a healthcare system that works against them. They are stigmatized, discriminated against, not treated with respect by their health providers, and confront significant obstacles in receiving the care they deserve. ” said Sally Greenberg, Chief Executive Officer of the National Consumers League. “This must change; we need an overhaul of the health system, and we believe an Obesity Bill of Rights can drive this transformation.”

Because this change will only happen if there is agreement on a set of basic rights that ensure adults with obesity receive respectful, timely, and effective obesity care, NCL and NCOA unveiled www.Right2ObesityCare.org, a new online engagement platform, so the nation’s health providers, insurers and employers can play a role in developing the Obesity Bill of Rights.  Right2ObesityCare.org explains the purpose and research-driven process and encourages a wide range of health professionals – from obesity medicine specialists and physicians to dietitians, nutritionists, exercise physiologists, health educators, and mental health professionals – to contribute their ideas.

Town Halls Chart the Obstacles for Adults with Obesity and Their Providers

Along with hearing from health professionals, the Obesity Bill of Rights will be informed by the insights of both adults with obesity and their health providers who participated in four town hall meetings that NCL and NCOA hosted across the country. Held in senior centers and churches in

California, Delaware, Mississippi, and Oklahoma between June and August 2023, the town halls involved more than 250 older adults, community leaders, and local clinicians who laid bare a healthcare system that is inhospitable to delivering quality obesity care.                                                        

When asked to share their experiences, older adults attending the town halls spoke of feeling invisible when seeing a health provider, not being listened to, and being treated with disdain when they initiated conversations about their obesity. At the same time, physicians described feeling inadequate to provide obesity care due to the limited time for counseling, not enough training in obesity management, inadequate coverage and reimbursement for obesity care, and needing better tools to help patients recognize obesity risks. This confirms research that finds adults with excess weight often feel unwelcome in the doctor’s office or believe that seeking help for obesity signifies moral failure. [3]

“This is a chronic condition that no one wants to talk about,” said Ramsey Alwin, NCOA President and CEO. “For several decades, NCOA has worked to empower older adults to better manage their chronic conditions. To break down barriers related to obesity, we held town halls that allowed both older adults and their health providers to relay their lived experiences. What we learned is that encouraging more people to seek obesity care requires an investment in science-based, easy-to-understand, accessible information about obesity; a healthcare system that encourages informed decision-making and patient-centered care; and effective public policy that requires health plans to provide access to the treatments deemed appropriate by the health provider, including lifestyle interventions, FDA-approved weight loss medications, and bariatric surgery.”

Mobilizing for Change
With the townhalls as a guidepost, NCL and NCOA are now leading a rigorous process to finalize and release the Obesity Bill of Rights to the medical community and public before the end of 2023. The process includes hosting a meeting of top experts to review a preliminary draft with recommendations for refinement. NCL and NCOA will also seek feedback from specialists in minority health, aging, and rural health, as well as health professionals and other stakeholders who offer advice through the online engagement platform.

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About NCL

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. The organization’s mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

About NCOA

The National Council on Aging (NCOA) is the national voice for every person’s right to age well. We believe that how we age should not be determined by gender, color, sexuality, income, or ZIP code. Working with thousands of national and local partners, we provide resources, tools, best practices, and advocacy to ensure every person can age with health and financial security. Founded in 1950, we are the oldest national organization focused on older adults. Learn more at www.ncoa.org.

[1] Hales CM,, et al. Prevalence of Obesity and Severe Obesity Among Adults: United States, 2017-2018. Centers for Disease Control and Prevention. NCHS Data Brief. No. 360. February 2020.

[2] Stokes A, et al. Prevalence and Determinants of Engagement with Obesity Care in the United States. Obesity. Vol. 26, Issue 5; May 2018, 814-818

[3] Gunther S, et al. Barriers and enablers to managing obesity in general practice: a practical approach for use in implementation activities. Qual Prim Care. 2012; 20: 93-103

NCL applauds FDA for its latest decision to approve an updated COVID-19 vaccine

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September 11, 2023

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – The NCL applauds the FDA’s announcement approving the latest COVID vaccine, which will be available to many Americans immediately or very soon to patients who are eligible.

The Centers for Disease Control and Prevention recorded 9,000 COVID-19 hospital admissions in the week ending July 29, a 12.5-percent increase from the week before. While that’s far below the nearly 45,000 admissions recorded the same week a year ago, the new vaccine is nevertheless is welcome and much needed to keep COVID and its new variants in check. The percentage of emergency department patients diagnosed with COVID-19 has risen gradually in July.

NCL response to the Request for Information regarding FDA regulation of CBD

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August 25, 2023

Media contact: National Consumers League – Katie Brown, katie@nclnet.org, 202-823-8442

Washington, DC – On August 17, the National Consumers League responded to the Request for Information regarding FDA-Regulation of CBD.

“In 2019, in response to the proliferation of unreviewed and untested CBD products, NCL identified the need for greater education among consumers about CBD and better enforcement of regulations in the CBD marketplace. NCL created Consumers for Safe CBD to address the need, champion the rights of consumers, and call on government and industry to do better – to ensure safety and promote a pathway for new products through clinically tested scientific research. Since then, action has been taken on the state and federal levels to increase access to cannabinoids beyond CBD. In response, NCL expanded our educational campaign and established Cannabis Consumer Watch.” 

The full letter can be found here.

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About the National Consumers League (NCL)
The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.