Annual per patient outpatient pharmacy costs at hospitals participating in the 340B Drug Discount Program are significantly higher than in non-340B hospitals, according to new analysis from the Pharmaceutical Research and Manufacturers of America (PhRMA). The analysis, prepared by Milliman and commissioned by PhRMA, found the average amount spent on drugs for outpatients at 340B hospitals was $457, almost three times the average $159 spent on at non-340B hospitals. 

The 340B Drug Discount Program requires drug manufacturers to provide certain healthcare organizations with outpatient drugs at significantly reduced prices, with the aim of reducing the cost of medication and treatment for patients. Outpatient medicines cover a range of treatments and drugs, including intravenous medicines administered at a hospital’s offsite facility, medications dispensed to patients at the hospital pharmacy, or at contract pharmacies. 

PhRMA’s analysis indicates patients visiting 340B hospitals could be required to pay higher costs for medication if the discounts are not passed on to the patients or payers and under the current legislation, hospitals are not required to pass on these savings to patients. It suggested this is because deductibles and coinsurance usually expose patients to higher cost sharing when the overall cost of their prescriptions rises and hospitals do not pass on 340B savings. 

“There is a growing body of research showing that the 340B program is driving up costs for patients and the healthcare system,” said Stephen J Ubl, president and chief executive officer PhRMA. “The biopharmaceutical industry has long supported the 340B program, but perverse incentives have steered it away from its original intent. It’s time to get 340B back on track for patients,” he added. 

Last month, a study published in the New England Journal of Medicine on the Consequences of the 340B Drug Pricing Program concluded there is “no evidence” to suggest hospitals benefiting from discounted drugs were providing more inpatient care to patients on a low-income, or that the standard of care was enhanced sufficiently to reduce mortality among this demographic. Furthermore, a 2015 report by the Government Accountability Office analyzing the cost of treatment for patients with Medicare Part B at 340B hospitals suggested the 340B program encourages hospitals to prescribe more medication or more expensive medication as they profit from the discounted cost and payment from patients and payers. 

If you are struggling with the cost of medication for you or your family, there are a number of ways to minimize your expenses and ensure you get the best price for drugs.

5 Ways to Lower Your Prescription Costs

1.  Check your insurance against other prices

• Insurance may not be the cheapest way to buy your medication. Pharmaceutical companies sometimes offer discounts on expensive drugs and, on occasion, paying the cash price can work out cheaper than copays. 

2.  Ask your physician about cheaper generic alternatives

• Generic drugs account for nine out of ten prescriptions filled in the United States, yet only one-quarter of the total drug spend, according to figures from QuintilesIMS. For example, branded Lipitor (atorvastatin) is priced as high as $480 for 30 tablets, but the same number of generic atorvastatin tablets can be purchased for under $8 on ModRN Health.

3.  Ask your pharmacist if you are getting the lowest price

• Pharmacies may be able to offer you a lower price, but you don’t get it if you don’t ask!

4.  Compare prices at different pharmacies

• The cost of medication can vary significantly between pharmacies, even those situated across the road from each other. Use ModRN Health to find which of your local pharmacies offer the best prices. 

5.  Explore alternatives to medication

• In some cases, lifestyle changes or alternatives to medication may be suitable treatment options or improve health sufficiently to reduce the need for medicine.