What’s Affordable, Anyway?

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

New polling data from the Kaiser Family Foundation (KFF) found that the cost of living—particularly healthcare and gasoline costs—is at the top of Americans’ minds as the U.S. heads into the 2026 mid-term elections. KFF found that, when asked if they were worried about being able to afford different basic needs, 60% of respondents indicated that healthcare costs, including the costs of health insurance and out-of-pocket expenses, such as office visits and prescription drugs, were of most concern, followed by 59% of respondents indicating that gasoline and transportation costs were top of mind (Schumacher et al., 2026).

Source: Gallup

This raises a key question with which few are willing to grapple:

How are we defining “affordable”?

In the strictest sense, “affordable” means something is priced low enough to be easily paid for or purchased.

But this raises another important question:

Affordable for whom?

According to Donald J. Trump, “The word ‘affordability’ is a Democrat scam” (Revell, 2025). He’s also called the concept of affordability a “fake narrative,” a “hoax,” and a “con job” (Green, 2025).

None of this is surprising, as the president has never had to “afford” anything in his entire life; nor, apparently, have any key members of his administration, including Trump Secretary of the Treasury, Scott Bessent, who claimed that Americans should be worried about affordability because, “…the Biden Administration destroyed affordability” (Wang & Farrow, 2026).

This has been the refrain of Republicans at both the state and federal levels since time immemorial: when costs increase during a Republican administration, it is always the fault of Democratic policies and politicians, regardless of how long Republicans have been in power and irrespective of objective reality.

But let us not lay the blame of unaffordability directly at the feet of just Republicans. Democrats have regularly abused the word “affordable,” with the naming of the Affordable Care Act (ACA) serving as one of the primary examples of how simply slapping the word “affordable” on something does not make it affordable. Despite its promises to control healthcare cost growth, national healthcare expenditures (in 2024 U.S. dollars) have soared from $3.83 trillion in 2014, when much of the ACA took effect, to $5.28 trillion in 2024 (Rakshit et al., 2026).

The issue with affordability is that it is largely subjective: when you’re poor, virtually nothing is “affordable” unless it’s free; when you’re wealthy and don’t have to worry about choosing food or healthcare, your concept of affordability skews toward your own experiences.

And maybe this is the crux of the issue: the people who set the policies that affect prices—from filing fees to taxes to tariffs to rates for goods and services—live in a bubble where “affordability” is largely an afterthought.

Source: Institute for New Economic Thinking

Despite consistent promises made by every presidential administration since the 1970s’ stagflation crisis to make life more affordable for Americans, nothing seems to change, in no small part because the private entities that set prices for food, healthcare services, and medications are often the largest donors to American politicians. When it comes time to craft meaningful legislative and administrative solutions to actually make life affordable, those donors expect obeisance from the officials they’ve purchased.

When it comes to healthcare costs, the same truths come into sharper focus. Few other industries are so regularly and publicly asked to substantiate the costs of their services to the American public—or Congress—than actors in the healthcare space. Health insurers, pharmaceutical manufacturers, and hospital industry representatives are often required to show up and justify why costs are so high, but little decisive action to reduce costs for consumers is ever taken; instead, we get political theater, even when both political teams come out swinging against the healthcare industry, and no real changes.

Why is that?

The simplest explanation is that nobody wants to truly upset the two proverbial apple carts:

The first apple cart holds the industries that provide healthcare services to Americans. In 2024, healthcare expenditures in the U.S. accounted for 18% of economic spending as a percentage of Gross Domestic Product (GDP), and that number is expected to grow to 21% by 2034 (Peter G. Peterson Foundation, 2026). Moreover, the U.S. healthcare system depends heavily on various funding mechanisms, such as the 340B Drug Pricing Program, for survival, meaning that trying to solve the healthcare affordability crisis by addressing just one aspect of healthcare services could cause another to collapse.

For example, 340B-eligible hospitals argue that if they are forced to demonstrate they are using 340B revenues appropriately, they will have to close locations. Why? Because that level of transparency would cost them their eligibility.

But this isn’t just the argument made by hospitals. Virtually any policy that is designed to lower costs for consumers is met with thinly veiled threats by healthcare industry players:

The most common refrain we hear from pharmaceutical partners is that any price controls introduced in the U.S. will force them to slow innovation, slow or halt drug development, or simply take products off the market. Health insurers echo this refrain, arguing that any attempt to force them to lower premiums and deductibles will force them to close operations and leave people without health insurance coverage.

This makes the first apple cart particularly pernicious: healthcare industries are more than willing to threaten service reductions or closures when their profits are threatened.

The second apple cart holds the donors that can make or break political campaigns.

Source: Politico

It’s hard to demand substantive changes from those who have paid their way into office, or who have used their position to enhance their personal wealth. When industries are allowed to bankroll politicians—actions that have been deemed “protected speech” by the U.S. Supreme Court—it’s not surprising that they then expect those politicians to fall in line when it comes to advancing their interests over the interests of everyday Americans. As a result, we get regulatory frameworks without teeth; healthcare laws that don’t actually control healthcare costs; endless Congressional investigations and hearings that provide excellent soundbites, but don’t go anywhere in terms of legislation and policymaking.

The hard truth for many to swallow is that making healthcare affordable means making it affordable for everyone, whether healthcare industry players like it or not. This means regulations and eligibility requirements that have teeth; it means making it more expensive for companies to fall out of compliance than to comply; it means revoking eligibility for federal programs, subsidies, and pricing agreements if providers are regularly non-compliant.

But this is not a conversation that many are willing to have, because in America, the Almighty Dollar is King. And so long as profits are high and shareholders are happy, we plebeians can go kick rocks!

Disclaimer: All funders of the ADAP Advocacy Association are publicly listed on our website. 

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association; rather, they provide a neutral platform for the author to promote open, honest discussion of public health-related issues and updates.

References:

[1] Green, E. L. (2025, December 02). Trump Calls Affordability a ‘Con Job’ as His Edge on the Economy Slips. New York, NY: The New York Times: US: Politics. https://www.nytimes.com/2025/12/02/us/politics/trump-affordability-economy-messaging.html

[2] Peter G. Peterson Foundation. (2026, August 11). Chart Pack: Healthcare. New York, NY: Peter G. Peterson Foundation. https://www.pgpf.org/article/chart-pack-healthcare/

[3] Rakshit, S., Winger, A., Cotter, L., McGough, M., Wager, E., & Cox, C. (2026, January 22). How has U.S. spending on healthcare changed over time? San Francisco, CA: Peterson-KFF Health System Tracker: Health Spending. https://www.healthsystemtracker.org/chart-collection/u-s-spending-healthcare-changed-time/

[4] Revell, E. (2025, December 02). Trump calls affordability 'a Democrat scam' as inflation concerns persist nationwide. New York, NY: Fox Business: Politics. https://www.foxbusiness.com/politics/trump-calls-affordability-a-democrat-scam-inflation-concerns-persist-nationwide

[5] Schumacher, S., Valdes, I., Mulugeta, M., Kearney, A., Kirzinger, A., & Hamel, L. (2026, October 06). KFF Health Tracking Poll: Health Care Issues in the Lead-Up to the 2026 Midterm Election. San Francisco, CA: KFF: Public Opinion. https://www.kff.org/public-opinion/kff-health-tracking-poll-health-care-issues-in-the-lead-up-to-the-2026-midterm-election/

[6] Wang, S. & Farrow, F. (2026, January 28). Bessent says Americans 'should be worried about affordability,' but blames Biden for cost issues. New York, NY: ABC News: Politics. https://abcnews.com/Politics/bessent-americans-worried-affordability-blames-biden-cost-issues/story?id=129636939

340B: The Glue That Should Hold Our Healthcare System Together

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

In June 2026, ADAP Advocacy released its latest policy paper—340B Program: The Glue That Should Hold Our Healthcare System Together—focusing on the explosive growth of the 340B Program from just 1,000 covered entities (CEs) and 503 contract pharmacies (CPs) in 1992 to over 53,000 CEs and 34,840 CPs in 2024. In addition to examining this growth and its causes, ADAP Advocacy also provided concrete recommendations to ensure the 340B Program can function in perpetuity (Macsata, et al., 2026). The policy paper is the latest in a series supporting the organization's argument that the 340B Program is too big to fail.

Source: ADAP Advocacy

ADAP Advocacy argues that, because the 340B Program spans more than 42,000 healthcare organizations and 32,000 pharmacies, it should be the glue that holds our healthcare system together. Instead, the 340B program has essentially become a slush fund for unscrupulous CEs—primarily hospitals—that lines executives’ pockets while cutting corners, costs, and services for both staff and patients. That’s not to suggest the program isn’t vitally important, or that there aren’t plenty of good actors…CEs…in the 340B space, because it is, and there are. The fact of the matter is a healthcare program of this size and magnitude cannot be entrusted to good faith alone; rather, improved transparency guardrails are needed to ensure its success and ultimately its intended beneficiaries: patients.

Primary Drivers of Growth:

ADAP Advocacy identified several key drivers of growth in the 340B program, including:

• The expansion of eligibility categories;
• The expansion of large health systems;
• The growing utilization by CEs of off-site clinics and child sites; and
• The explosive growth of Pharmacy Benefit Managers (PBMs) and contract pharmacies operating in the American healthcare space as third-party administrators for CEs

Policy Proposals

ADAP Advocacy also recommended several policy proposals to address the myriad issues facing the program, including:

• The implementation of a program-wide rebate model, in which drugs are purchased at full price up front, and rebates are provided by manufacturers at a later date;
• The consideration of a rebate “sales draw” under the program-wide rebate model that accounts for agencies with smaller annual operating revenues (e.g., those with less than $2 million);
• Mandatory reporting requirements for CEs, including how revenues have been used to improve patient care, reduce drug costs, or expand community services;
• Clearly defining “patient” in the statute—who qualifies as a patient, and which purchases qualify for 340B rebates; and
• Establishing an enforcement mechanism with real teeth and penalties ranging from civil monetary penalties to loss of 340B eligibility.

Each proposal is designed to ensure 340B revenues are used for patients in need, as intended by those who created the program. And these changes are long overdue.

Source: ADAP Advocacy | iStock

In 2025, 340B drugs exceeded $179.5 billion in list prices, with hospitals as the biggest cost driver (Martin et al, 2026). The 340B Program is immensely significant, and rising waste, fraud, and abuse pose an increasing risk. Because the American healthcare system is highly interdependent, a weakness in one sector can have widespread repercussions, making the 340B Program's impact especially important. 

Research published in September 2026 by the Pioneer Institute found that hospitals participating in the 340B Program spent an average of just 2.16% of their operating expenses on charity care, compared to 2.82% at non-340B hospitals. It also found that 340B hospitals spent just 1.6% of operating expenses on care for uninsured patients, compared with 2.26% at non-340B hospitals (Popovian et al., 2026).

Popovian et al. are quick to point out that their findings do not suggest that participating in the 340B Program “causes” hospitals to provide less charity care or care at cost; rather, their findings demonstrate that the 340B Program’s drug discounts, savings, and revenues do not reliably translate into providing more help for patients (either in terms of healthcare provision or lower costs), and that current reporting requirements are insufficient to ensure that 340B revenues are being appropriately utilized in ways that comport with either the letter or intent of the statute.

Source: Pioneer Health

Last month, ADAP Advocacy launched a national advocacy campaign focused on the data and findings of its most recent 340B white paper, including infographics, social media posts, op-eds, and video content. The campaign is patient-centric in that it informs patients, regardless of their chronic health condition or rare disease, why they can no longer sit on the sidelines and watch the pharmaceutical industry and big hospital systems duke it out over what is in our best interest. Nothing about us, without us!

Disclaimer: All funders of the ADAP Advocacy Association are publicly listed on our website. 

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association; rather, they provide a neutral platform for the author to promote open, honest discussion of public health-related issues and updates.

References:

[1] Macsata, B. M., Anthony, G., Hopkins, M. J., Sosa, J. (2026, June). 340B Program: The Glue That Should Hold Our Healthcare System Together. Nags Head, NC: ADAP Advocacy: Policy Center: 340B: Policy Papers. https://www.adapadvocacy.org/s/2026_ADAP_Project_RW_340B_Asset_32_340B_Glue_Should_Hold_Healthcare_Together_061526.pdf

[2] Martin, R., Karne, H., Zen, S. (2026, June), The Size and Growth of the 340B Program in 2025. IQVIA. https://www.iqvia.com/-/media/iqvia/pdfs/us/white-paper/2026/iqvia-size--growth-of-340b-in-2025-white-paper-2026.pdf

[3] Popovian, R., Sydor, A. M., Czubaruk, K., Walker, M., & Smith, W. (2026, September 24). The 340B Accountability Gap: Charity Care, Uncompensated Care, and Medicaid Patient Volume Among 340B and Non-340B Hospitals: What the Data Mean for 340B Accountability and Reform. Boston, MA: The Pioneer Institute: Pioneer Health. https://pioneerinstitute.org/wp-content/uploads/2026/09/2026-09-08-Cancer-Care-340B-Paper.pdf

Goliath vs. Goliath—How the 340B Devil’s Bargain Might Self-Destruct

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

Mount Sinai Health Systems (New York, NY), the University of Kansas Hospital Authority (Kansas City, KS), and the University of Michigan Hospitals and Health Centers (Ann Arbor, MI) are suing CVS Health for failing to properly reimburse them for drugs purchased and dispensed under the massive 340B Drug Pricing Program, claiming under-reimbursement to the tune of nearly $250 million over a period of five years (Hut, 2026).

Source: Forbes | Getty

The suits, filed in three separate courts, argue that CVS, which serves as a contract pharmacy for all three health systems, accuses CVS Health and its subsidiaries of retaining illegally large shares of 340B revenues generated and failing to remit them to the covered entities that generated the sales. The plaintiffs are seeking triple damages under the federal Racketeer Influenced and Corrupt Organizations (RICO) Act and seek injunctions enjoining CVS from continuing the business practices in question (Halleman, 2026).

In addition to the three initial suits, Henry Ford Health (Detroit, MI) sued CVS on July 16, alleging 340B revenue diversions amounting to more than $29 million, requesting the courts force CVS to disgorge any profits retained from the alleged diversion scheme and reinstate the pharmacy services CVS terminated with the health system in April—a termination that Henry Ford argues was in retaliation for its attempt to audit their arrangement with CVS (Jeffries, 2026a).

Source: Henry Ford Health

And then, a fifth hospital, Froedtert Memorial Lutheran Hospital (Milwaukee, WI), sued CVS Health on August 20th, alleging diversions amounting to $18 million between 2020 and 2025. When Froedtert attempted to audit CVS on March 2nd, 2026, CVS refused the request and terminated the hospital’s pharmacy services. This suit alleges breach of contract, fraud, violations of the Wisconsin Deceptive Trade Practice Act, and civil RICO violations, and it also seeks triple damages, reinstatement of the pharmacy services agreement, and disgorgement of profits derived from the scheme (Jeffries, 2026b).

CVS Health has been in the spotlight in 2026, after a particularly damaging congressional hearing in which Representative Alexandria Ocasio-Cortez (D-NY-14) all but accused CVS Health CEO David Joyner of operating an illegal monopoly.

During the January 22nd, 2026, hearing, Ocasio-Cortez highlighted what former CVS Health CEO Karen Lynch referred to as its “captive strategy,” in which CVS provides services to patients through its health insurance company, Aetna, and its primary care clinic, Oak Street Health, fills prescriptions through CVS, operates a Pharmacy Benefit Manager (PBM), CVS Caremark, and develops biosimilar medications through its Dublin, Ireland-based drug manufacturer, Cordavis (Hopkins, 2026).

Source: Rep. Alexandria Ocasio-Cortez

In response, CEO David Joyner stated, “No, I wouldn't agree that it's market concentration. I would suggest it's a model that works really well for the consumer.”

These suits against CVS Health bring to the fore one of the primary complaints against PBMs and contract pharmacy arrangements: if CVS (or any contract pharmacy or PBM) is surreptitiously or illegally hoarding 340B revenues, those are funds not being used to benefit patients. Maybe an amicus brief might be in order here?

To be certain, ADAP Advocacy has consistently called out many hospital systems for failing to properly use 340B revenues to benefit patients. In this case, five large health systems are going up against an equally large, and arguably more publicly bruised, company.

And we’re anxiously awaiting the outcomes...

Disclaimer: All funders of the ADAP Advocacy Association are publicly listed on our website. 

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association; rather, they provide a neutral platform for the author to promote open, honest discussion of public health-related issues and updates.

References:

[1] Halleman, S. (2026, May 22). Hospitals sue CVS for allegedly siphoning $250M in 340B funds. Newton, MA: Healthcare Dive. News. https://www.healthcaredive.com/news/hospitals-file-340b-lawsuit-cvs-health/820959/

[2] Hopkins, M. J. (2026, January 29). Congress Shines Spotlight on Health Insurance Companies' Squeeze on Patients. Washington, DC: ADAP Advocacy: ADAP Blog. https://adapadvocacyassociation.blogspot.com/2026/01/congress-shines-spotlight-on-health.html

[3] Hut, N. (2026, May 27). 340B lawsuits against CVS allege $250M in underpaid hospital reimbursement. Downers Grove, IL: Healthcare Financial Management Association. https://www.hfma.org/payment-reimbursement-and-managed-care/cvs-340b-lawsuits-hospital-reimbursement/

[4] Jeffires, E. (2026a, July 22). Henry Ford Health sues CVS, alleges 340B pricing scheme. Chicago, IL: Becker’s Hospital Review: Legal & Regulatory Issues. https://www.beckershospitalreview.com/legal-regulatory-issues/henry-ford-health-sues-cvs-alleges-340b-pricing-scheme/

[5] Jeffries, E. (2026b, August 31). Milwaukee hospital sues CVS over $18M in alleged 340B diversion. Chicago, IL: Becker’s Hospital Review: Legal & Regulatory Issues. https://www.beckershospitalreview.com/pharmacy/milwaukee-hospital-sues-cvs-over-18m-in-alleged-340b-diversion/

When Hospital 'Community Benefits' Benefit Relatively Few

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

The proverbial dead horse highlights how drug purchases under the 340B Drug Pricing Program exceeded $100 billion for the first time in 2025—an increase from 2024 of 22.8%—according to the Health Resources and Services Administration (HRSA), with hospitals accounting for a combined $83,936,162,423 (83.9%) across all hospital types (HRSA, 2026). Today’s fast-paced news cycle dictates a look at the primary vehicle used by 340B hospitals to claim they are using 340B Program revenues to serve patients: “Community Benefits”.

Photo Source: Debt.com

According to a 2025 report released by the American Hospital Association (AHA), a special interest group that bankrolls inside-the-beltway lobbying firms pretending to care about patient access to care, the 1,166 340B hospitals examined by Research Triangle Institute (RTI) International spent $99,473,767,285 on “Total Benefits to the Community” (AHA, 2025).

What’s key here is how RTI and the AHA have defined “Community Benefit.” It truly amounts to nothing more than profit-driven shenanigans.

By their definition, “Community Benefits” include the following:

• Type of Benefit Provided (1,166 individual hospitals)
• Financial assistance, unreimbursed Medicaid, and unreimbursed costs from means-tested government programs
• Other benefits, including health professions education, medical research, cash and in-kind contributions to community groups
• Community-building activities
• Medicare Shortfall
• Bad debt expense

In fairness, now, this definition didn’t arise out of nowhere. It is a direct response to definitions set by the Internal Revenue Service (IRS) for reporting in Schedule H of the federal Form 990. Schedule H is broken into six parts, each of which is reported to the IRS for data collection purposes. Below are brief descriptions of each Part, but only Parts I, II, III, and VI specifically apply to what the IRS considers to be a “community benefit”:

Part I: Quantifying "Community Benefit"

Part I of Schedule H attempts to quantify the community benefit provided by hospitals annually. Expenses that are reportable in Part I include free care, unreimbursed Medicaid, unreimbursed costs from other means-tested government programs, community health improvement services, health professions education, subsidized health services, research, and contributions to other community groups.

ADAP Advocacy's take: The IRS has not suggested a minimum level of expenditures required to justify tax-exempt status.

Part II: Community Building Activities

Part II quantifies the hospital's community building activities. Although the definition of "community building" may not be obvious at first glance, it is generally understood to refer to programs that are intended to have a beneficial impact upon the health of a community but that do not provide medical care. Examples of community building are housing improvements, economic development, community support, environmental improvements, leadership development, coalition building, community health improvement advocacy, and workforce development.

ADAP Advocacy's take: Despite the inclusion of community building metrics on the Schedule H, these numbers are still separate from the reporting of charity care and community benefit expenditures in Part I. The IRS commentary on the Schedule's final draft reflected the view that the link between community building and health remained tenuous and that the reporting tools in Schedule H are intended, in part, to serve as data collection methods for the IRS to discern what links exist.

Part III: Medicare Shortfalls and Bad Debt

Hospitals incur costs when treating all patients, including patients who are covered by Medicare. Medicare, however, may not reimburse a provider for the total cost of services received by a patient. The difference between the Medicare reimbursement rates and the costs incurred by a hospital are called shortfalls. Schedule H includes a dedicated area in which to report Medicare shortfalls.

ADAP Advocacy's take: Despite the addition of Part III, the IRS does not appear to automatically treat Medicare shortfalls as a direct measure of community benefit. Instead, hospitals are asked to "[d]escribe ... the extent to which any shortfall reported [in Part III] should be treated as community benefit." 

Photo Source: Grammarist

Hospitals regularly engage in billing and collection practices to recoup co-pays, deductibles, and other expenses from patients.

ADAP Advocacy's take: Schedule H allows hospitals to report bad debt in Part III alongside Medicare shortfalls, but bad debt expense may not be reported on the charity care and community benefit table in Part I. As with Medicare shortfalls, filing hospitals must explain what portion of bad debt should be considered community benefit. The IRS comments accompanying the Schedule's final draft indicated that it does not intend to treat any portion of bad debt as a de facto community benefit, citing a lack of consensus on bad debt policies among hospitals.

 Part IV: Management Companies and Joint Ventures

Part IV requires disclosure of any joint ventures in which a hospital participates. 

Part V: Facility Information

Part V requests information about the entity's health care facilities, including questions about compliance with the ACA's requirements.

Part VI: Supplemental Information

Part VI of Schedule H provides an area in which to provide narrative information regarding the amount of community benefit provided. The IRS stated that this area could be used to justify why some portion of Medicare shortfall or bad debt reported in other areas of the Schedule should be considered community benefit. In addition, hospitals may provide details about other community benefits they provide that are not easily quantifiable (Liu, 2024).

As far as ADAP Advocacy can see from the Congressional Research Service (CRS), hospitals are defining “Community Benefit” in a way that does not comply with IRS standards. In fact, of the $99,473,767,285 RTI International reported, 9.5% of those expenditures—including community-building activities, Medicare shortfall, and bad debt expenses—would not be considered a “community benefit” by the IRS.

But observers really need to look further into what “Community Benefits” mean for each category.

When ADAP Advocacy examines Form 990s to review “Charity Care” expenditures, specifically Line 7, Section a is of interest (Figure 1):

Figure 1 – An Example of the Financial Assistance at Cost Line Item in Schedule H on the federal Form 990 Tax Return

Photo Source: ProPublica, 2026

This line specifically asks hospitals to report their provision of “Financial Assistance at cost,” or “charity care.”

The IRS specifically defines “charity care” as, “…free or discounted health services provided to persons who meet the organization's eligibility criteria for financial assistance and are unable to pay for all or a portion of the services.” In fact, the IRS further specifies that charity care DOES NOT INCLUDE, “…bad debt or uncollectible charges that the organization recorded as revenue but wrote off due to a patient's failure to pay, or the cost of providing such care to such patients; the difference between the cost of care provided under Medicaid or other means-tested government programs or under Medicare and the revenue derived therefrom; self-pay or prompt pay discounts; or contractual adjustments with any third-party payors” (Levinson et al., 2022).

This is why, when looking at the very friendly report published by the AHA, the entirety of their “Community Benefits” reporting should be questioned.

Why?

Because on virtually every Form 990 we examined that included full Schedule H reporting, Line 7, Section b (Medicaid), was significantly higher than Section a.

This means that the provision of “Financial Assistance at cost” makes up a vanishingly small percentage of the entirety of Schedule H reporting.

This prompts a vital question: Should the other sections in Line 7 still be considered a “community benefit”?

Absolutely.

But patients need clear information on how those hospitals are using 340B revenues to DIRECTLY benefit patients. Absent that, GoFundMe pages most likely will continue to serve as the "community benefit" standard for most patients straddled with hospital medical debt.

Disclaimer: All funders of the ADAP Advocacy Association are publicly listed on our website. 

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association; rather, they provide a neutral platform for the author to promote open, honest discussion of public health-related issues and updates.

References:

[1] American Hospital Association. (2025, September). 340B Hospital Community Benefit Analysis. Chicago, IL: American Hospital Association: Data & Insights: Guides & Reports. https://www.aha.org/system/files/media/file/2025/10/340b-hospital-community-benefit-analysis.pdf

[2] Health Resources and Services Administration. (2026, July). 2025 340B Covered Entity Purchases. Rockville, MD: United States Department of Health and Human Services: Health Resources and Services Administration: Office of Pharmacy Affairs: 340B Drug Pricing Program: Program Updates. https://www.hrsa.gov/opa/updates/2025-340b-covered-entity-purchases

[3]Levinson, Z., Hulver, S., & Neuman, T. (2022, November 03). Hospital Charity Care: How It Works and Why It Matters. San Francisco, CA: KFF: Topics: Health Costs. https://www.kff.org/health-costs/hospital-charity-care-how-it-works-and-why-it-matters/

[4] Liu, E. C. (2024, April 15). Legal Requirements for Section 501(c)(3) Hospitals. Washington, DC: Congressional Research Service. https://www.congress.gov/crs-product/R48027

[5] ProPublica. (2026). Full text of "Full Filing" for fiscal year ending Nov. 2023. New York, NY: ProPublica: Nonprofit Explorer: California: Oroville Hospital. https://projects.propublica.org/nonprofits/organizations/941634554/202402859349301695/full

Medical Debt Soars, Despite 340B Purchases Passing $100 Billion

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

Drug purchases under the 340B Drug Pricing Program exceeded $100 billion for the first time in 2025—an increase from 2024 of 22.8%—according to the Health Resources and Services Administration (HRSA), with hospitals accounting for a combined $83,936,162,423 (83.9%) across all hospital types (HRSA, 2026). Yet despite this program’s explosive growth and its inherent promise to expand access to care and treatment for low-income patients, medical debt in the United States now tops $220 billion (Macsata, 2025). Could this be the true reason why patient advocates increasingly find themselves aligned with drug manufacturers on the need to rein in and reform the 340B Program?

Photo Source: ADAP Advocacy | YouTube

Among hospital covered entities (CEs), Disproportionate Share Hospitals (DSHs)—hospitals that serve low-income patients and receive payments from the Centers for Medicare & Medicaid Services (CMS) to cover the costs of providing care to uninsured patients—accounted for $79,235,079,126 (79.2%). Yet despite this influx of cash, nearly two-thirds of adults who carry past-due medical bills owe money directly to hospitals (Macsata, 2025).

By comparison, all Ryan White HIV/AIDS Program (RWHAP) CEs combined accounted for just $3,092,689,404 (3.1%) of all 340B Program drug purchases. State AIDS Drug Assistance Programs (ADAPs) are widely regarded as the Gold Standard among these CEs, and most have operated under a rebate model for decades.

On the heels of HRSA’s new data release, Patients Rising—a national patient advocacy and education group based in Washington, DC—released a report in which they examined over 900 bankruptcy filings across six states (Colorado, Louisiana, Maine, Virginia, Washington, and Wisconsin) and found that 45% of filings listed verified 340B hospitals as creditors, totaling $6.62 million in debt. In some filings, debt accrued at a single 340B hospital accounted for as much as 98% of the household’s total debt. In that specific example, the household's monthly income was just $1,800, while the total debt from Christus Highland was $386,758 (Patients Rising, 2026).

Upon seeing these data, Dr. Adam J. Fein, President of Drug Channels Institute, argues that, due to the unwieldy, undermanaged, and largely unregulated nature of the 340B Program, reform may, in fact, never occur (Fein, 2026).

Dr. Fein argues that this monstrous growth in 340B drug purchases has reached a compound annual growth rate of ~22% per year over the last 15 years (Figure 1), while manufacturer sales have grown by just 7.3%, making 340B the single largest source of manufacturer discounts in the U.S.

Figure 1 – 340B Drug Program Prices: Purchases by Covered Entities, 2010 to 2025

 

Photo Source: Drug Channels Institute

While Dr. Fein does show that pharmaceutical list prices have also grown exponentially, he points to peer-reviewed research that used price-volume-mix decomposition to examine the relative importance of list prices vs. drug utilization (i.e., the number of pills, capsules, syringes, etc. purchased and distributed) to determine whether price increases or utilization were driving the growth of the 340B Program. Zeng et al. found that utilization accounted for an average of 79.6% of 340B growth based on list price, and nearly 100% of growth based on 340B drug prices (Zeng et al., 2025).

Similar to Dr. Fein, ADAP Advocacy has recently argued that CMS, rather than HRSA, should assume control of the 340B Program, in no small part because it has significant regulatory and enforcement staffing resources on hand to administer a program the size of 340B.

But while Dr. Fein’s concern is that Congress will not adequately take up the mantle of reform in the face of the program's enormity, ADAP Advocacy believes it is imperative that they do so. Since March 2025, we've argued that the program is now too big to fail.

In our recent policy paper, "340B Program: The Glue That Should Hold Our Healthcare System Together", we argue that Congress should reform the 340B program to implement a system-wide rebate model (similar to those currently working for state ADAPs), as well as mandating wholly transparent reporting, clearly defining who qualifies as a “patient” eligible to receive 340B discounted drugs, and establishing compliance and enforcement standards that require all covered entities to open disclose how much in rebates they receive and how those revenues are spent in alignment with both the letter and the spirit of the 340B statute.

Photo Source: ADAP Advocacy

ADAP Advocacy stands firmly in our conviction that the 340B Program must be fundamentally reformed. To be clear, no one side—save for patients in need of care—is faultless in allowing this program to spin wildly out of control. There is culpability to go around; but only one side—drug manufacturers—is required to provide discounted prices and rebate revenues to covered entities, and it is far easier for pundits, politicians, and even patients to paint pharmaceutical companies as the bad guys for drug pricing while holding hospitals and other covered entities blameless.

Disclaimer: All funders of the ADAP Advocacy Association are publicly listed on our website. 

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association; rather, they provide a neutral platform for the author to promote open, honest discussion of public health-related issues and updates.

References:

[1] ADAP Advocacy. (2026, July 27). ADAP Advocacy Calls for CMS to Oversee 340B Drug Pricing Program. Washington, DC: ADAP Advocacy. Press Room. https://www.adapadvocacy.org/s/2026_ADAP_Press_340B_Oversight_CMS_072726.pdf

[2] Fein, A. J. (2026, July 15). The 340B Program Hit $100 Billion in 2025: Has It Become Too Big to Reform? Philadelphia, PA: Drug Channels Institute: Drug Channels. https://www.drugchannels.net/2026/07/the-340b-program-hit-100-billion-in.html

[3] Health Resources and Services Administration. (2026, July). 2025 340B Covered Entity Purchases. Rockville, MD: United States Department of Health and Human Services: Health Resources and Services Administration: Office of Pharmacy Affairs: 340B Drug Pricing Program: Program Updates. https://www.hrsa.gov/opa/updates/2025-340b-covered-entity-purchases

[4] Macsata, B. M., Laws, J., Hopkins, M. J. & Sosa, J. (2025, April). Patient Medical Debt: Findings from Quantitative Patient Survey in the United States. Washington, DC: ADAP Advocacy. https://static1.squarespace.com/static/698f8fa09fc8884466a1becd/t/69d85991b19c033c07b2a52b/1775786385556/2025_ADAP_Project_RW_340B_Asset_17_Medical_Debt_Survey_Report_04-23-25.pdf 

[5] Macsata, B. M., Anthony, G., Hopkins, M. J., & Sosa, J. (2026, July 08). 340B Program: The Glue That Should Hold Our Healthcare System Together. Washington, DC: ADAP Advocacy: Policy Center: 340B: Policy Papers. https://www.adapadvocacy.org/s/2026_ADAP_Project_RW_340B_Asset_32_340B_Glue_Should_Hold_Healthcare_Together_061526.pdf

[6] Patients Rising. (2026, July). Medical Bankruptcy in the United States. Washington, DC: Patients Rising. https://6015202.fs1.hubspotusercontent-na1.net/hubfs/6015202/01-PatientsRising-u4m/Research%20Papers/Medical-Bankruptcy-in-America-and-340B_6-State-Analysis-White%20Paper-email..pdf

[7] Zeng, S., Sarraille, W., & Martin, R. (2025, May 21). What is driving 340B growth: utilization or price? Health Affairs Scholar, 3(6), qxaf104. https://doi.org/10.1093/haschl/qxaf104

The Opacity Behind the 340B-Eligible Hospital Transparency

By: Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

What happens when one of the only ways a 340B Drug Pricing Program-eligible Covered Entity (CE) can be evaluated relies on a single line item on a federal tax form? This is one of the primary questions that 340B reform advocates must grapple with, and a point that 340B-eligible hospitals consistently rail against (American Hospital Association, 2025). The debate over what hospitals hide from consumers of healthcare services... patients... is a growing storm inside the Washington Beltway and across the nation.

At present, the Financial Assistance at Cost line item in Schedule H on federal Form 990 tax returns is the only way to measure how 340B-eligible hospitals use the revenues generated by 340B drug rebates (Figure 1).

Figure 1 – An Example of the Financial Assistance at Cost Line Item in Schedule H on the federal Form 990 Tax Return

Photo Source: ProPublica, 2026

In the example in Figure 1, Oroville Hospital, located in Oroville, CA, reported that, in tax year 2022, it provided $9,027,670 in healthcare services at no cost to patients, accounting for 2.28% of its $397,658,853 in annual revenue (ProPublica, 2026).

This is slightly above the national average of charity care provision of 2.2% in 2023 (Levinson et al., 2025) and higher than the charity care expenditures reported by 75 of the 98 hospitals (76.5%) whose 990s ADAP Advocacy has examined for its 340B Map, the average of which is just 0.93% of their annual revenues.

So, what does that mean?

Because there are virtually no public reporting requirements for most 340B CEs, determining how those CEs reinvest 340B-generated revenues in patient care is virtually impossible. This is incredibly problematic because, while there are statutory requirements that dictate the purpose of those revenues, the inability to ensure CEs are using those revenues properly means that a huge percentage of the revenues generated by nearly $200 billion in 340B-eligible drug purchases in 2025 are untraceable and may be misspent (IQVIA, 2026).

Hospitals argue that:

Charity care is only indicative of the amount of care provided to patients who qualify for the hospital’s financial assistance policy and is therefore provided to the patient free of cost. It does not account for costs that hospitals incurred for services where payment was expected but not received (bad debt) or payment shortfalls from public payers like Medicaid (underpayments). Therefore, it is more accurate to look at a hospital’s total uncompensated care (bad debt and charity care) and their total community benefits, which among other costs includes uncompensated care costs as well as payment shortfalls. 340B hospitals are providing high levels of uncompensated care and community benefits despite many of these hospitals operating on razor-thin margins (American Hospital Association, 2025).

Hospitals, the American Hospital Association argues, are being transparent about their expenditures through federal tax filings and public reporting by individual hospitals. Ask them to quantify exactly how 340B revenues are being spent, however, and they will tell you they’re not required to disclose that information.

In a June 18th Substack report from The Rojas Report, Dutch Rojas states that Yale New Haven Hospital spends just 0.69% of its total expenses on the provision of charity care. This information is gleaned from his examination of federal Form 990s for both Yale New Haven Hospital and Yale New Haven Health Services Corporation, the latter of which does not file a Schedule H. Rojas argues that:

In fiscal 2021, Yale New Haven Hospital spent 0.69 percent of its total expenses on charity care.

Read that again.

Not 6.9 percent.

Not even one percent.

Sixty-nine hundredths of a single percent.

This is an organization the Internal Revenue Service classifies as a charity. A 501(c)(3). Tax-exempt on the theory that it exists to serve a public so underserved that the rest of us agree to forgo the taxes it would otherwise owe. That is the deal. That is the entire justification for the exemption.

Now set the charity number against the size of the enterprise. Yale New Haven Health is Connecticut’s largest health system. It reported total operating revenue of $7.24 billion in fiscal 2024 and $7.58 billion in fiscal 2025. A charity does not operate at that scale. A Fortune 500 company does (Rojas, 2026).

Photo Source: The Rojas Report

Additional research led by Robert Popovian, visiting health policy fellow at the Pioneer Institute, currently awaiting peer review, has found that, among the 3,999 hospitals analyzed, 340B hospitals actually provided lower levels of charity care compared to non-340B hospitals (2.16% compared to 2.82%), with Critical Access Hospitals (CAH) providing the lowest average percentages of charity care (1.69%). These researchers conclude that participation in the 340B program does not consistently correlate with higher levels of charity care, suggesting a misalignment between the program’s intent and its outcomes (Popovian et al., 2026).

This aligns largely with what ADAP Advocacy has discovered over the course of its multi-year 340B Executive Compensation project. We examined the federal Form 990s of over 100 hospitals, looking at 990s dating to the year prior to each hospital’s admission to the 340B program, the year immediately after becoming a covered entity, five years after eligibility, ten years after, and the most recently available 990 at the time of research.

In our most recent supplemental report released in December 2025, we found that, across the 98 hospitals with examinable Schedule H filings, the provision of charity care as a percentage of annual revenues decreased by an average of 20.06% from the earliest Schedule H filing to the most recent. In fact, just 27 of those hospitals increased charity care provision, while 41 saw decreases of 50% or greater (Figure 2, Hopkins & Macsata, 2025).

Figure 2 - Largest Decreases in the Provision of Charity Care as a Percentage of Annual Revenue in Hospitals After Receiving Eligibility for the 340B Drug Rebate Program: Updated for 2025 Supplemental Report #2

Photo Source: ADAP Advocacy

Federal legislators are also expressing concern over the relative ungovernability of hospitals, particularly large hospital systems. In the current 119th Congress, Representative Gregory Murphy, M.D. (R-NC-03) introduced the Tax Exempt Hospital Transparency Act (H.R. 9504), which would require every tax-exempt hospital to include the following information in their annual tax filings:

• A description of how each organization is addressing the needs identified in the most recent community health needs assessment conducted under section 501(r)(3), and a description of any such needs that are not being addressed together with the reasons why such needs are not being addressed,
• The audited financial statements of such organization (or, in the case of an organization the financial statements of which are included in a consolidated financial statement with other organizations, such consolidated financial statement),
• The Centers for Medicare & Medicaid Services (CMS) certification number of the organization (or such other identifying information as the Secretary may require),
• The value, at cost, of the financial assistance provided during such taxable year pursuant to the organization’s financial assistance policy (as described in section 501(r)(4)), and
• The number of completed financial assistance applications received, granted, and denied during the taxable year pursuant to the organization’s financial assistance policy (as described in section 501(r)(4)).

Specific to the 340B Program, high revenue tax-exempt hospitals would have to report:

• (A) IN GENERAL.—For purposes of this subsection, the term ‘specified Federal 340B drug discount program information’ means—
• (i) the total number of individuals, by their type of insurance coverage, who were dispensed or administered covered outpatient drugs during the taxable year that were subject to an agreement under section 340B of the Public Health Service Act,
• (ii) the aggregate net 340B payment amount with respect to such drugs subject to such an agreement dispensed or administered by the organization during such taxable year, and
• (iii) the aggregate costs incurred by the organization during such taxable year that were necessary for such organization to participate in the program under such section and to comply with such program’s requirements (including program-related compliance, legal, educational, and administrative costs, and compensation paid to independent contractors to carry out program-related functions).
• (B) COVERED OUTPATIENT DRUG.—For purposes of this paragraph, the term ‘covered outpatient drug’ has the meaning given such term in section 340B(b) of the Public Health Service Act.
• (C) AGGREGATE NET 340B PAYMENT AMOUNT.—For purposes of this paragraph, the term ‘aggregate net 340B payment amount’ means, with respect to a covered outpatient drug purchased by an organization under an agreement under section 340B of the Public Health Service Act and dispensed or administered to an individual by such organization, the excess (if any) of—
• (i) the total amount of payments received from any payor by the organization for such drug, over
• (ii) the ceiling price (as described in subsection (a)(1) of such section) for such drug (or, if less, the price at which such organization acquired such drug) (H.R. 9504).

H.R. 9504 was passed by the House Committee on Ways and Means to the full House on July 1st, 2026, on a party-line voice vote (Republicans in favor; Democrats opposed). Democratic opposition to the bill largely centered on the addition of new administrative burdens placed on hospitals in the wake of over $1 trillion in cuts to healthcare programs in the One Big Beautiful Bill Act of 2025. The American Hospital Association, predictably, came out in opposition to the bill (McAuliff, 2026).

Photo Source: The New York Times

The reality is this:

Until such time as the public and legislators are able to examine how 340B drug rebate revenues are being utilized by covered entities, in general, and by hospitals specifically, accusations of malfeasance on the part of large health systems are going to continue, particularly with the growing threats posed to patients by private equity firms and managers (Hopkins, 2026).

In the meantime, unless hospitals voluntarily disclose how those 340B revenues are being reinvested, they’ll simply have to deal with their lack of charity serving as the primary metric by which they’re judged.

Disclaimer: All funders of the ADAP Advocacy Association are publicly listed on our website. 

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association; rather, they provide a neutral platform for the author to promote open, honest discussion of public health-related issues and updates.

References:

[1] American Hospital Association. (2025, October). Fact Sheet - 340B Drug Pricing Program: Fact vs. Fiction. Chicago, IL: American Hospital Association. https://www.aha.org/system/files/media/file/2025/10/fact-sheet-340b-drug-pricing-program-fact-vs-fiction-R.pdf

[2] Hopkins, M. J. & Macsata, B. M. (2025, December). The 340B Drug Rebate Program and its Potential Impacts on Annual Revenues, Executive Compensation, and Charity Care Provision in Eligible Covered Entities: Supplemental Report Two – December 2025. Washington, DC: ADAP Advocacy: Policy Center: 340B: Policy Papers. https://static1.squarespace.com/static/698f8fa09fc8884466a1becd/t/6a0b59ad218bcc00c30a3017/1779128749408/2025_ADAP_Project_RW_340B_Asset_30_ExecComp_Supplemental_Report_2_%2812.22.25%29.pdf

[3] Hopkins, M. J. (2026, June 18). The Growing Access Barrier Facing Patients: Private Equity. Washington, DC: ADAP Advocacy: Blog. https://adapadvocacyassociation.blogspot.com/2026/06/the-growing-access-barrier-facing.html

[4] IQVIA. (2026, June 04). The Size and Growth of the 340B Program in 2025. Durham, NC: IQVIA: United States: Library: White Papers. https://www.iqvia.com/locations/united-states/library/white-papers/the-size-and-growth-of-the-340b-program-in-2025

[5] Levinson, Z., Hulver, S., Godwin, J., & Neuman, T. (2025, February 19). Key Facts About Hospitals. San Francisco, CA: KFF: Health Costs. https://www.kff.org/health-costs/key-facts-about-hospitals/?entry=the-hospital-industry-number-of-hospitals

[6] McAuliff, M. (2026, July 01). Tax-exempt hospitals targeted in bill demanding more disclosure. Chicago, IL: Modern Healthcare: Politics & Regulation. https://www.modernhealthcare.com/politics-regulation/mh-house-tax-exempt-hospital-transparency-act/

[7] Popovian, R., Sydor, A. M., Czubaruk, K., Walker, M., & Smith, W. (2026, February 17). Financial Outcomes and Community Benefit in the 340B Program: Comparing 340B and Non-340B Hospitals. medRxiv. https://doi.org/10.64898/2026.02.12.26346191

[8] ProPublica. (2026). Full text of "Full Filing" for fiscal year ending Nov. 2023. New York, NY: ProPublica: Nonprofit Explorer: California: Oroville Hospital. https://projects.propublica.org/nonprofits/organizations/941634554/202402859349301695/full

[9] Rojas, D. (2026, June 18). Yale New Haven Spends 0.69% of Its Budget on Charity Care. Where the Rest Goes Is the Real Story. New York, NY: The Rojas Report. https://read.rojasreport.com/p/yale-new-haven-spends-069-of-its

[10] Tax Exempt Hospital Transparency Act, H.R. 9504, 119th Cong. (2026). https://www.congress.gov/bill/119th-congress/house-bill/9504