Tennessee legislation that would prevent manufacturers from "imposing any restrictions, prohibitions, discriminating against, or otherwise limiting the acquisition of a 340B drug" has sailed through committees and is likely to be voted on this week.
The 340B Drug Pricing Program was established more than 30 years ago to create a discount program in not-for-profit hospitals that serve low-income patients. Some say it is a lifeline for rural hospitals. Others say the program needs more transparency and has resulted in profits for hospitals.
Tennessee's legislation is similar to bills passed by other states in the past two years. It does have a caveat that bans health care entities from using the savings "in a manner" that follows laws regarding immigration, abortion and transgender care for minors.
Senate Bill 1414 received a 27-0 vote from the Finance, Ways and Means Committee and is on Wednesday's calendar for the full chamber. House Bill 1242 is not on the calendar this week but is eligible for a vote by the full body.
The legislation has strong opposition from some health care groups.
An analysis released by the National Alliance of Healthcare Purchaser Coalitions this month said larger hospitals benefit from the program. Commercial prices were 7% higher at large hospitals that participated in the program than those that did not, and outpatient procedures were nearly 20% higher, the report said.
“This study adds to the large and growing body of evidence that 340B is often a shell game that has a substantial impact on commercial healthcare prices,” said Shawn Gremminger, president and CEO of the National Alliance of Healthcare Purchaser Coalitions. “While the analysis does not imply causation, it shows an overwhelming correlation between 340B eligibility and higher costs for employers and other health care purchasers and working families.”
Tennessee Sen. Richard Briggs, R-Knoxville, said the bill he is sponsoring would keep rural contract pharmacies from closing.
"If you start closing them or making them not part of the program, we may have, particularly with our patients in the rural areas, who may have to drive 30 minutes, 40 minutes to an hour just to go to a pharmacy," Briggs said during a committee presentation of the bill.
Congress is also looking at the program.
U.S. Sen. Bill Cassidy, R-La., who chairs the Senate Health, Education, Labor, and Pensions Committee, has sent letters to hospitals, community health centers and contract pharmacies as part of his investigation into how the program is being used.
