The Association of 340B Program Drug Margins with Covered Entity Characteristics
Bibliographic Data
| ID | 13775268 |
|---|---|
| Authors | Robert J Nordyke (0000-0003-2424-7852, Petauri LLC, formerly National Pharmaceutical Council, Washington, DC, USA), James Motyka (0009-0006-9216-0141, National Pharmaceutical Council, Washington, DC, USA), Julie A Patterson (0000-0002-0602-3882, National Pharmaceutical Council, Washington, DC, USA, corresponding author) |
| Year | 2025 |
| Volume | 62 |
| Pages | 469580251324051-469580251324051 |
| Publication date | 2025-03-23 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | INQUIRY The Journal of Health Care Organization Provision and Financing (JOURNAL) |
| Journal identifiers | ISSN: 0046-9580 • E-ISSN: 1945-7243 |
| Publisher | SAGE Publishing (PUBLISHER • US) |
| DOI | 10.1177/00469580251324051 |
| PMID | 40123227 |
| OpenAlex | W4408775175 |
| Language | EN |
| References cited | 30 |
The 340B Drug Pricing Program aims to help facilities serving low-income and uninsured patients to stretch scarce resources by allowing covered entities to purchase outpatient drugs at federally mandated discounted rates while often receiving reimbursement for them at higher rates by commercial payers and Medicare. Despite increasing focus on the expansion and impact of the program, profit margins under 340B have not been fully explored. We aimed to examine drug-, facility-, and geographic-level factors that influence drug margins among 340B covered entities. We conducted a cross-sectional analysis of predictors of facility-level 340B margins for 5 drug classes in a multivariable regression model using 2021 data linked across multiple proprietary and public datasets. Regression results show that drug, facility characteristics, and geographic healthcare market-level characteristics influence drug margins under the 340B program. Adjusted 340B margins were higher in hospital outpatient departments than free-standing offices (ie, hospital-affiliated physician offices and independent, 340B eligible clinics) and among covered entities in more concentrated (ie, less competitive) markets. Covered entity market power, quantified by a facility-level measure of non-340B drug margins indicating pricing power, and area wealth were both associated with higher 340B drug margins. Margins on 340B drugs were higher among facilities in stronger bargaining positions and those serving wealthier areas. These findings add to the growing body of literature on expansions of the 340B program into more affluent communities, informing calls for reforms to ensure the 340B program serves low-income and uninsured patients
Actuarial science · Business · Drug pricing · Economic growth · Economics · Health care · Logistic regression · Reimbursement · Health Systems, Economic Evaluations, Quality of Life · Healthcare cost, quality, practices · Healthcare Policy and Management · Medicine
Trends in 340B Drug Pricing Program Contract Growth Among Retail Pharmacies From 2009 to 2022
Outcomes of the 340B Drug Pricing Program
US Hospital Service Availability and New 340B Program Participation
Reforming 340B to Serve the Interests of Patients, Not Institutions
Assessment of US Pharmacies Contracted With Health Care Institutions Under the 340B Drug Pricing Program by Neighborhood Socioeconomic Characteristics
B Participation and Safety Net Engagement Among Federally Qualified Health Centers
| Citation velocity | historical |
|---|---|
| Highly cited | No |