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

Extraction Dressed Up as Care: Why the 340B Program Needs to Answer to Patients

By: Ryan Alvey, Executive Director & Founder, Positive Change Movement, and member of the ADAP Advocacy 340B Patient Advisory Committee

The 340B Drug Pricing Program was created with a simple moral promise: to help safety-net providers stretch limited resources so vulnerable patients could get care, medication, and support. What happened to that promise?

Photo Source: ADAP Advocacy

As a person living with HIV in rural Kentucky, I know exactly what that promise is supposed to mean. It is supposed to mean that someone like me does not have to beg for care. It is supposed to mean that HIV service organizations exist for people living with HIV, not merely because of us. It is meant to mean that the money generated by our diagnoses, our prescriptions, our labs, and our lives comes back to the communities it was intended to serve. 

But too often, that is not what patients experience. 

I am not writing this as an outsider looking at a policy chart. I am writing this as a gay man living with HIV and numerous comorbidities who became an advocate because I had no choice. I have sat in rooms where people talk about ending the HIV epidemic while people living with HIV are missing from leadership. I have watched organizations build budgets, salaries, reputations, and public-relations campaigns around our suffering, while those most affected are treated as inconvenient whenever we ask questions.

And I have lived the consequences of a system where the provider holds all the power.

In rural communities, there may be only one HIV provider within reach. If that provider refuses  care, delays care, restricts access, or retaliates against a patient who speaks up, the patient does  not simply "go somewhere else." Somewhere else may require half a day of travel. Somewhere else may require transportation that the patient does not have or fuel that the patient cannot afford. Somewhere else may mean months without consistent care. Somewhere else may mean choosing between dignity and survival.

That is why 340B transparency is not an abstract policy issue. It is a patient safety issue.

The 340B Program is now enormous. IQVIA reported that in 2025, drug sales under the program topped $179.2 billion, which represented a year-over-year increase of 20% (IQVIA, 2026). The federal agency charged with policing the program describes it as a way for healthcare providers to “stretch scarce federal resources,” reach more eligible patients, and provide more comprehensive services.

That purpose matters. But purpose without accountability is just branding. 

An ADAP Advocacy report, "Is the 340B Drug Pricing Program the Next 'Too Big to Fail'?", asks the question many patients have been asking quietly for years: where are the savings going?  The report argues that 340B has grown without sufficient transparency and highlights an analysis of 102 providers in which annual revenues increased dramatically after joining 340B, CEO compensation rose, and hospital charity care declined.

Photo Source: ADAP Advocacy

This issue should concern everyone who cares about the future of HIV care. Charity care isn't just limited to hospitals; it's really about supporting people. The truth is, individuals with untreated, symptomatic HIV or advanced AIDS tend to use hospitals more often, facing higher admission rates and longer stays (NIH, 2018).

To be clear, 340B should not be destroyed or weakened. For HIV care, it can be essential. State AIDS Drug Assistance Programs (ADAPs) and Ryan White grantees depend heavily on drug rebates and savings to keep people insured, medicated, and...alive. The National Alliance of State and Territorial AIDS Directors (NASTAD) reported that in calendar year 2024, ADAPs achieved an 87% viral suppression rate among clients served, compared with an estimated 67% among all people living with diagnosed HIV in the United States.

That is exactly why reform matters.

When a program is this important, patients cannot afford blind trust. We cannot afford vague assurances that “the money helps the mission.” We need to know how. We need to know whether 340B revenue is paying for direct patient assistance, transportation, housing stabilization, peer navigation, rural access, mental health support, and culturally competent care — or whether it is being absorbed into executive salaries, expansion strategies, branding, buildings, and bureaucracy. 

People living with HIV should not have to file records requests, complaints, lawsuits, or whistleblower reports just to understand whether money intended to help us is actually reaching us.

Despite the Denver Principles, our community has been told for decades to trust institutions. Trust the nonprofit service provider. Trust the grant recipient. Trust the volunteer board. Trust the same systems that too often exclude the very people whose lives justify their funding.

I do not trust systems that refuse to be transparent.

Photo Source: ADAP Advocacy | iStock

If an HIV service organization receives funding from the Ryan White HIV/AIDS Program and benefits from 340B Program-related revenue, and claims to exist for people living with HIV, then it should be able to answer basic questions.

How much 340B revenue did it generate? How much was spent on direct patient assistance? How many patients received help with rent, utilities, transportation, food, insurance premiums, or emergency needs? How many people living with HIV serve on its board? How many people living with HIV hold paid leadership positions? How many complaints were filed by patients, applicants, employees, or community members? And how many of those complaints were independently investigated?

These questions are not attacks. They are the bare minimum.

The 340B Program's future cannot be decided only by hospitals, pharmaceutical companies, lobbyists,  providers, and trade associations. People living with HIV must be at the center of the conversation. Not as testimonials. Not as photos in annual reports. Not as an advisory board decoration. As decision-makers.  

Because we know what happens when accountability is optional.

We know what it feels like to be reduced to a funding category. We know what it feels like to see organizations praised publicly while patients go without help privately. We know what it feels like to be told that a program exists for us, only to be treated as a problem when we demand access, equity, and dignity.

The phrase “too big to fail” entered the public consciousness after the 2008 financial crisis, describing institutions so deeply embedded in the economy that their collapse could threaten the entire system. Julie Young’s definition of "too big to fail” is useful here because the 340B Program has become embedded in the healthcare financing system in much the same way: too large to ignore, too important to casually dismantle, and too dangerous to leave without accountability.

But Duncan Watts pushed the idea even further in the Harvard Business Review, asking whether some systems are not just “too big to fail” but “too big to exist” in their current form.  That is the question 340B now forces us to ask. Not whether the program should disappear, but whether a program this large should continue operating with so little transparency about where the savings actually go.

Photo Source: Third Way

Recent policy analysis from Third Way has also warned that hospitals can use 340B pricing advantages to increase revenue without ensuring patients receive the benefit.  That is exactly why patients should not be asked to accept vague promises. If providers are generating savings in the name of low-income, uninsured, underinsured, and chronically ill patients, then those patients deserve proof that the money is reaching them.

If the 340B Program is truly a safety-net program, then patients should be able to see the net. We should be able to touch it. We should know it will hold us when we fall.

Anything less is not safe. 

It is extraction dressed up as care.

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] Health Resources and Services Administration. (n.d.). 340B Drug Pricing Program. U.S. Department of Health & Human Services. Retrieved online at https://www.hrsa.gov/opa

[2] Health Resources and Services Administration. (2025, December 10). 2024 340B Covered Entity  Purchases. U.S. Department of Health & Human Services. Retrieved online at https://www.hrsa.gov/opa/updates/2024-340b coveredentity-purchases 

[3] Macsata, B.M., Anthony, G., & Hopkins, M.J. (2025, February). Is the 340B Drug  Pricing Program the Next “Too Big to Fail”? Washington, DC: ADAP Advocacy.  https://www.adapadvocacy.org/s/2025_ADAP_Project_RW_340B_Asset_16_Too_Big_To_Fail  _03-07-25.pdf 

[4] Martin, R., Karne, H., and Zeng, S. (2026, June 4). The Size and Growth of the 340B Program in 2025. IQVIA. Retrieved online at https://www.iqvia.com/-/media/iqvia/pdfs/us/white-paper/2026/iqvia-size--growth-of-340b-in-2025-white-paper-2026.pdf

[5] NASTAD. (2026). 2026 National Ryan White HIV/AIDS Program Part B ADAP Monitoring  Project Annual Report. Retrieved online at https://nastad.org/2026-rwhap-part-b adapmonitoring-report 

[6] Thune, J. (2024). SUSTAIN 340B Act Discussion Draft Explanatory Statement and Supplemental Request for Information. Bipartisan 340B Senate Working Group. Retrieved online at  https://www.thune.senate.gov/wp-content/uploads/media/doc/340B%20Discussion%20Draft%20Explanatory%20Document%20and%20Subsequent%20RFI.pdf 

[7] Rowell-Cunsolo TL, Liu J, Shen Y, Britton A, Larson E. The impact of HIV diagnosis on length of hospital stay in New York City, NY, USA. AIDS Care. 2018 May;30(5):591-595. doi: 10.1080/09540121.2018.1425362. Epub 2018 Jan 17. PMID: 29338331; PMCID: PMC5860957.

[8] Watts, D. (2009, June). Crisis Management – Too Big to Fail? How About Too Big to  Exist? Harvard Business Review. Retrieved online at https://hbr.org/2009/06/too-big-to-failhow about-too-big-to-exist 

[9] Wofford, David. (2025, February 12). How Hospitals are Raising Drug Prices. Third Way: Report. Retrieved online at https://www.thirdway.org/report/how-hospitals-are-raising-drug-prices 

[10] Young, Julie. (2023, November 13). Too Big to Fail: Definition, History, and Reforms. Investopedia: Terms. Retrieved online at https://www.investopedia.com/terms/t/too-big-tofail.asp

New House Bill Would Require Insurers to Count Direct-to-Consumer Drug Purchases

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

A bill introduced by Representative Greg Murphy, M.D. (R-NC-03), would require insurers to count the cost of prescription medications purchased through direct-to-consumer platforms, such as the TrumpRX website (Hopkins, 2026), toward both deductibles and out-of-pocket maximums (Minemeyer, 2026).

Photo Source: Rep. Greg Murphy

The "Every Dollar Counts Act" (H.R. 8270), introduced in April 2026, would amend title XXVII of the Public Health Service Act, the Employee Retirement Income Security Act of 1974, and the Internal Revenue Service Code of 1986 to require out-of-pocket expenditures for drugs to count towards an individual’s deductible and out-of-pocket maximums. It does come with some caveats:

To count, the medication must be on the individual’s health plan’s formulary, meaning it would otherwise be covered by the insurance plan with a co-pay (Goldman, 2026).

"Direct-to-patient platforms have the potential to radically transform the drug marketplace, applying much-needed downward pressure on the extraordinary cost of lifesaving medicines. However, patients who are set to benefit most cannot apply their expenditures on drugs purchased through these platforms to their health insurance out-of-pocket contribution requirements. By making this possible, we are putting patients first and promoting competition to drive down costs further" (Murphy, 2026).

Photo Source: Congress.gov

Direct-to-consumer/patient platforms are becoming increasingly common since 2024, with numerous pharmaceutical companies and organizations, including Amgen (maker of Repatha), Eli Lilly (Zepbound), Novo Nordisk (Wegovy), Pfizer (Eliquis), AstraZeneca (Farxiga), Novartis (Cosentyx), Bristol Myers Squibb (Sotyktu), and PhRMA, the U.S. pharmaceutical lobbying group based in Washington, DC, going live with websites offering medications directly to patients, often at lower prices than what they would pay when using their commercial insurance (Constantino & Coombs, 2025).

The concept of direct-to-consumer sales isn’t new; but in an age when almost every medication purchase (in the United States) goes through complex chains of manufacturers, wholesalers, pharmacy benefits managers (PBMs), and pharmacies that then get filtered through another round of payors (e.g., commercial and public health insurers), consumers often have little idea of the true cost of their medications. More to the point, tiered prescription co-pays and the availability of manufacturer and commercial drug coupons, such as manufacturer patient assistance programs (PAPs) and GoodRx, make it difficult for patients to make informed decisions about the most affordable way to obtain their medications.

Patients have been sharing their stories on social media and in the press with their anecdotal encounters where they face a high-dollar sticker shock at the pharmacy register, only for their pharmacist to scan a different barcode behind the counter and come back with a significantly lower dollar amount (Fottrell, 2026).

Photo Source: Elements Magazine

GoodRx, founded in 2011, provides patients with a relatively easy-to-use website and smart phone app that allows patients to explore drug prices at various local pharmacies based on zip code. They also offer a subscription service, GoodRx Companion, that offers low-cost medications and savings on various medical services (GoodRx, 2026).

For consumers, this may seem like insurance, but GoodRx is quick to remind patients at every step that it is not health insurance; it is a collection of co-pay assistance coupons.

And this is the rub for many consumers: if they can get their prescription drugs this cheaply by scanning a QR Code, why should they ever have to pay a higher price?

This is an excellent question.

Why should American consumers be required to pay higher prices than any other nation for medications (Editor’s Note: Asking this question is not an endorsement of the deeply flawed Most Favored Nations proposed policy change)? Why should American consumers have copay accumulator programs that prohibit patient assistance program assistance from counting toward their deductibles? Why should American consumers be held captive in an endless labyrinth of ever-changing co-pays, surprise bills, and coverage denials for medications listed as being “covered”?

The answer is simple: because the “system” allows it.

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] Constantino, A. K. & Coombs, B. (2025, October 07). Healthy Returns: Amgen joins a growing list of drugmakers selling directly to consumers. Englewood Cliffs, NJ: CNBC: Health Returns. https://www.cnbc.com/2025/10/07/healthy-returns-amgen-other-drugmakers-launch-dtc-programs.html

[2] Every Dollar Counts Act, The, H.R. 8270, 119th Cong. (2026). https://www.congress.gov/bill/119th-congress/house-bill/8270

[3] Fottrell, Q. (2026, June 23). ‘It feels like a medical miracle’: How did a single QR code coupon cut my $618 Walgreens prescription to $15? New York, NY: MarketWatch: Personal Finance: The Moneyfist. https://www.marketwatch.com/story/it-feels-like-a-medical-miracle-how-did-a-single-qr-code-coupon-cut-my-618-walgreens-prescription-to-15-524a1151

[4] Goldman, M. (2026, April 14). Exclusive: GOP pushes sweetener for cash-pay drugs. Arlington, VA: Axios: Health. https://www.axios.com/2026/04/14/gop-cash-pay-drug-deductible

[5] GoodRx. (2026). GoodRx Companion. Santa Monica, CA: GoodRx: Companion. https://www.goodrx.com/companion

[6] Hopkins, M. J. (2026, January 22). Trump Administration Applauds Itself for Rx Access Agreements, But Will They Help Patients? Nags Head, NC: ADAP Advocacy: ADAP Blog. https://adapadvocacyassociation.blogspot.com/2026/01/trump-administration-applauds-itself.html

[7] Minemeyer, P. (2026, April 14). Bill would force payers to apply DTC drug purchases to patient deductibles. New York NY: Fierce Healthcare: Regulatory. https://www.fiercehealthcare.com/regulatory/bill-seeks-force-payers-apply-dtc-drug-purchases-patient-deductibles

[8] Murphy, G. F. (2026, April 14). Murphy Introduces Legislation to Lower Out-of-Pocket Costs for Drugs. Mantea, NC: U.S. Congressman Gregory F. Murphy, M.D.: Media: Press Releases. https://murphy.house.gov/media/press-releases/murphy-introduces-legislation-lower-out-pocket-costs-drugs

The Growing Access Barrier Facing Patients: Private Equity

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

The acquisition of hospitals and healthcare practices by private equity (PE) firms has increased dramatically over the past two decades, with PE deals involving healthcare businesses tripling from 2009 to 2016, and acquisitions of healthcare-related operations reaching a staggering $79 billion in 2019 (Halabi et al., 2025). This explosive growth in acquisitions has resulted in astonishing profits for PE firms, slashed salaries for PE-owned employees, and worse outcomes for patients.

Photo Source: Purchaser Business Group on Health

According to the Private Equity Stakeholder Project (PESP), approximately 488 hospitals in the U.S. are owned by PE firms, including 8.5% of all private hospitals and 22.6% of all proprietary for-profit hospitals. At least 27.7% of PE-owned hospitals serve primarily rural patients, and nearly a quarter (22.6%) of PE-owned facilities are psychiatric hospitals (PESP, 2025b).

The healthcare sector is particularly attractive to PE firms as healthcare spending accounts for nearly one-sixth (18%) of the U.S. gross domestic product (GDP), growing 7.2% in 2024, and reaching $5.3 trillion or $15,474 per person (CMS, 2026). With spending at those levels, PE firms can very easily increase profitability, which they largely achieve by decreasing expenditures, particularly those related to salaries, and increasing the number of services provided and billed.

Research published in the Annals of Internal Medicine found that emergency department salaries were cut by 18.2% compared with control hospitals, by 15.9% in intensive care units (ICUs), and by 16.6% hospital-wide, reducing the number of full-time hospital employees by 11.6% (Kannan et al., 2025).

These cuts in staffing come with a cost. Using Medicare Part A and B claims and Cost Report data from 2009-2019, Kannan et al. found that, while there was no observable increase in ICU mortality rates, deaths in PE-owned emergency departments increased by 13.4%. In addition, patient transfers to other acute care hospitals from emergency departments increased by 4.2% and from ICUs by 10.6% (Kannan et al., 2025).

Photo Source: PESP Private Equity Hospital Tracker

A study published in Health Affairs found that claims billed by PE-owned hospitals to Medicare increased by 30.5% after acquisition, resulting in a 14.9% increase in Medicare spending per physician over five quarters. Similarly, patients at PE-acquired primary care practices saw a 12.9% increase in the number of services received, including an 11.1% increase in laboratory tests and an 11.3% increase in preventive and screening services (Singh et al., 2026).

These increases in services, when combined with significant decreases in salaries and staffing, result in huge profits for PE firms just from Medicare payments alone. It is harder, however, to quantify any increases in revenues related to the 340B drug pricing program at these practices or hospitals for a few of reasons:

• According to the Private Equity Stakeholder Project (PESP), some hospitals are operated by PE firms through complex ownership structures, often masking who owns, operates, or oversees them (PESP, 2025b).
• Some non-profit hospitals, while not directly owned by PE firms, are managed by companies that are owned by PE firms. Many of these arrangements are not publicly disclosed (PESP, 2025b);
• Providers are not currently required by either the Health Resources & Services Administration (HRSA), the Center for Medicare & Medicaid Services (CMS), or the Internal Revenue Service (IRS) to report annual 340B revenues to the public or on any tax documents.

That does not, however, mean that PE firms don’t have 340B in their sights. In May 2026, Quorum Health, based in Brentwood, TN, announced that they would be abandoning their for-profit business model and switching to a non-profit model under the pretense of ‘…deliver[ing] quality care in rural and mid-sized communities.” Quorum admits that doing so will result in $13 million in annual savings from tax exemptions alone, and that the expected acquisition of eligibility for the 340B Program will result in $11 million in additional revenues. While this shift must be approved by regulators, it’s expected to be approved by Fall 2026 (Van Alstin, 2026).

These negative consequences have not gone unnoticed. The Private Equity Stakeholder Project—a Chicago-based non-profit watchdog organization founded in 2017 to monitor and address the growing impact of private equity and private fund managers in the climate & energy, workers & jobs, housing, healthcare, and detention & surveillance industries (PESP, n.d.)—began tracking hospitals owned by PE firms, creating an easily searchable list for public examination (PESP, 2025a) and an interactive map (PESP, 2025b).

Photo Source: Quartz

While nonprofit organizations and researchers are closely monitoring the impacts of PE firm ownership in the healthcare industry, state and federal legislators and regulators have struggled to keep pace with the pace of PE acquisitions. A recent article published in The American Journal of Managed Care has called on policymakers to “…pursue innovative regulatory solutions, including health care–specific PE law, alignment of state and federal oversight, adoption of alternative payment models, and strengthened patient protections against PE-associated clinical and nonclinical risks (Berman et al., 2026).

ADAP Advocacy echoes this call. Aside from the risks to patients, PE firms represent real and present dangers to the communities being served by the providers and hospitals they own and loot. They raid safety-net hospitals (O’Grady, 2022), bankrupt hospitals and sell off their property (DePillis, 2019), roll back or eliminate essential but less profitable services (Spegele, 2021), and leave communities with few, if any, options for accessing healthcare services. Those PE firms that have managed to worm their way into the non-profit provider sectors are also very likely reaping 340B revenues while patients suffer.

It’s time to curtail PE ownership in the healthcare sector, regardless of how much money it makes for owners and investors.

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] Berman, M. E., Tamirisa, K., Rahim, F. O., Khachadoorian-Elia, H., & Witkowski, M. L. (2026, May 11). Regulating Private Equity in Health Care: A Strategic Policy Agenda. American Journal of Managed Care, 32(5), e138-e140. https://doi.org/10.37765/ajmc.2026.89938

[2] Centers for Medicare and Medicaid Services. (2026, January 14). National health expenditure data: Historical. Washington, DC: United State Department of Health and Human Services: Centers for Medicare and Medicaid Services: Data and Research: Statistics, Trends, and Reports: National Health Expenditure Data. https://www.cms.gov/data-research/statistics-trends-and-reports/national-health-expenditure-data/historical

[3] DePillis, L. (2019, July 29). Rich investors may have let a hospital go bankrupt. Now, they could profit from the land. Atlanta, GA: CNN: CNN Business: Economy. https://www.cnn.com/2019/07/29/economy/hahnemann-hospital-closing-philadelphia/index.html

[4] Halabi, S., Belani, S., & O’Hara, G. (2025). Private Equity and Non-Profit Status in the US Healthcare System. Akron Law Review, 58(4), 687-715. https://ideaexchange.uakron.edu/akronlawreview/vol58/iss4/4?utm_source=ideaexchange.uakron.edu%2Fakronlawreview%2Fvol58%2Fiss4%2F4&utm_medium=PDF&utm_campaign=PDFCoverPages

[5] Kannan, S., Bruch, J. D., Zubizarreta, J. R., Stevens, J., & Song, Z. (2025, September 23). Hospital Staffing and Patient Outcomes After Private Equity Acquisition. Annals of Internal Medicine, 178(11), 1,528-1,538. https://doi.org/10.7326/ANNALS-24-03471

[6] O’Grady, S. (2022, November). How Private Equity Raided Safety Net Hospitals and Left Communities Holding the Bag: A Case Study on Leonard Green & Partners’ Ownership of Prospect Medical Holdings. Chicago, IL: Private Equity Stakeholder Project: PESP Private Equity Hospital Tracker. https://pestakeholder.org/wp-content/uploads/2022/11/Prospect_Primer_Nov-2022.pdf

[7] Private Equity Stakeholder Project. (2025a, April). PE hospital tracker. Chicago, IL: Private Equity Stakeholder Project: PE Hospital Tracker. https://airtable.com/appZYwbt3vioNrb95/shricxhAQSjpv5ec8/tbl058jjL6qNMqzkM

[8] Private Equity Stakeholder Project. (2025b, April). PESP Private Equity Hospital Tracker. Chicago, IL: Private Equity Stakeholder Project. https://pestakeholder.org/pesp-private-equity-hospital-tracker/

[9] Private Equity Stakeholder Project. (n.d.). About us. Chicago, IL: Private Equity Stakeholder Project: About Us. https://pestakeholder.org/about-us/

[10] Singh, Y., Dixit, M. N., & Whaley, C. M. (2026, May 20). Private Equity Acquisitions In Primary Care: Changes In Utilization, Spending, And Workforce. Health Affairs, 45(6), 629-636. https://doi.org/10.1377/hlthaff.2025.01703

[11] Spegele, B. (2021, April 11). A City’s Only Hospital Cut Services. How Locals Fought Back. New York, NY: The Wall Street Journal: Health: Healthcare. https://www.wsj.com/health/healthcare/a-citys-only-hospital-cut-services-how-locals-fought-back-11618133400

[12] Van Alstin, C. (2026, May 24). Nationwide private-equity backed hospital chain announces shift to nonprofit business model. Providence, RI: Innovate Healthcare: Health Exec: Business Intelligence. https://healthexec.com/topics/healthcare-management/business-intelligence/nationwide-private-equity-backed-hospital-chain-announces-shift-nonprofit-business-model

HIV Advocacy: Why Stories Change More Than Hearts

By: Michelle Anderson, MA, Grassroots Advocacy & Patient Storytelling Consultant, ADAP Advocacy

**First-Person Perspectives**

I have been in advocacy for more than 20 years, and for years, I have sat in rooms where decisions were being made for people like me without including people like me in the conversation. I have listened to presentations filled with statistics, charts, and research findings that spoke completely over my head. I have listened to reports that described the disparities affecting Black women living with HIV, but those reports were not always an accurate depiction because they did not provide a complete narrative of Black women's experiences when faced with the systemic pressures that create risk for HIV beyond behavior. Although the data is important and research matters, something is still missing.

Photo Source: Narrative Power Institute

I often say that stories are more than personal experiences. They are a form of knowledge that speaks beyond what data cannot convey. They help us understand how policies, systems, and institutions impact real lives. They reveal the human reality behind data and create opportunities for change that numbers alone often cannot achieve because they connect the numbers to human impact.

For instance, when a Black woman living with HIV shares her experiences, it brings context to the conversation. It helps people understand that HIV is not a single issue. It is often connected to issues like poverty, trauma, housing insecurity, gender-based violence, lack of healthcare access, and systemic racism. These are realities that cannot be fully captured in a report because statistics only tell the story of the disproportionate impact of HIV.

Storytelling makes systems visible. It helps us move away from stigmatizing rhetoric that blames individuals and toward examining the conditions that shape people's realities. Instead of asking why someone did not make a different choice, storytelling helps us understand why the decision was made, given the options available to them and the conditions that shaped those options.

I have seen firsthand how stories can change a room. I have watched policymakers lean in when they hear someone describe the choice between paying rent and paying for healthcare. I have seen healthcare providers reconsider their assumptions after listening to a patient who may have fallen out of care due to transportation barriers. I have watched community members connect with issues they previously viewed as distant or unrelated to their own lived experiences. Stories create understanding, empathy, accountability, and, most importantly, they create movement.

Photo Source: ADAP Advocacy

That same principle is at the heart of the work currently underway through the "ADAP Saves Lives: End the Wait" campaign, which was launched in response to the reemergence of ADAP waiting lists and restrictions in some parts of the country. For those of us who have been in this fight nearly 20 years ago, the thought of people once again waiting for access to life-saving HIV medication is deeply concerning. Storytelling is an essential advocacy tool because behind every policy decision is a person whose health may be affected. By elevating the voices of persons living with HIV, storytelling helps policymakers and communities understand what is truly at stake when access to care is threatened.

Meaningful Involvement of People Living with HIV/AIDS (MIPA) recognizes that people living with HIV should be involved, utilizing our lived expertise as leaders, decision makers, and partners in shaping the policies and programs that impact our lives. When people share their experiences in legislative hearings, advisory boards, advocacy campaigns, and community discussions, they provide evidence-informed solutions grounded in real-time experiences. This is when narrative begins to build power.

Narrative power is the ability to shape how people understand an issue. It is the ability to influence systems by challenging stigma, exposing data gaps, and moving conversations beyond awareness to impact. By shifting the narrative, our stories change perspectives, influence policy, and become the power that shapes how systems operate and whose voices are valued within them.

Photo Source: ADAP Advocacy

I believe that the people closest to the issues are often closest to the solutions. Lived experiences belong at decision-making tables because stories are more than personal testimonies. They are tools for leadership, advocacy, and systems change. Stories do change hearts, but they also change how people understand issues, how policies are shaped, and how systems respond to the communities they serve.

Stories do change hearts, but the power does not stop there. They help people understand, in real time, the realities behind data and the impact systems have on people’s lives. When we share our stories, we are challenging stigma, educating communities, informing policy, and creating opportunities for change. We move beyond awareness and into action. We transform our lived experiences into narrative power. This month marks the beginning of ADAP Advocacy’s narrative power to combat the resurgence of those dreading AIDS Drug Assistance Program waiting lists. Patient’s lives depend on it!

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.

Gonorrhea is the Chink in DoxyPEP's Armor

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

Recent studies have shown that DoxyPEP (doxycycline post-exposure prophylaxis) is becoming less effective against the bacterial sexually transmitted infection (STI) gonorrhea. Concerns are rising among certain public health groups, such as the Centers for Disease Control & Prevention and European counterparts, but Doxy-PEP remains regarded as a highly effective prevention method for high-risk groups.

Photo Source: Harvard Health Publishing

For the uninitiated, DoxyPEP is a post-exposure oral medication provided within 72 hours after a sexual encounter that reduces the likelihood of acquiring bacterial STIs, including syphilis, chlamydia, and gonorrhea. In the initial DoxyPEP trial, researchers found that the incidence of syphilis decreased by 87%, chlamydia by 88%, and gonorrhea by 55% (Dall, 2026). After this initial study, the Centers for Disease Control and Prevention (CDC) released clinical guidelines for its utilization in 2024 (Bachmann et al., 2024).

Even in the initial study, the reduced incidence of gonorrhea was modest, at best; subsequent studies have shown that a rapid increase in tetracycline-resistant strains of gonorrhea has greatly reduced or all but eliminated DoxyPEP’s efficacy against the infection.

Research published in JAMA Internal Medicine found that the incidence of STI cases of syphilis and chlamydia in San Francisco, CA, decreased significantly among Men who have Sex with Men (MSM) and transgender women against projected case numbers, while the incidence of gonorrhea increased significantly (Sankaran et al., 2025).

Another study published in Clinical Infectious Diseases suggests that widespread utilization of DoxyPEP may actually be contributing to the increase in tetracycline-resistant gonorrhea strains in King County, Washington state, which has resulted in the county health department revising its guidelines on the utilization of doxycycline to treat other bacterial issues, including skin and soft tissue infections and lower respiratory tract infections (Soge et al., 2025).

A third study published in The Lancet Infectious Diseases similarly suggests that widespread utilization of DoxyPEP may be inadvertently increasing the propagation of multidrug-resistant strains of gonorrhea in southern California (Yechezkel et al., 2026).

Photo Source: emedicinehealth.com

Drug-resistant strains of gonorrhea have been a concern in the United States for some time, and researchers have been sounding the call against overreliance upon DoxyPEP as a harm reduction tool against the STI for just as long. A correspondence published in the New England Journal of Medicine in 2025 warned that multidrug-resistant strains have been spreading globally, including strains that carry resistance to the antibiotic ceftriaxone (Helekal et al., 2025).

Sexual health advocates have been heralding DoxyPEP as one of the first effective methods for preventing STIs transmission since the findings of the initial study, including those at the American Sexual Health Association (ASHA, 2025). There is no doubt that DoxyPEP has clearly been shown to be effective against syphilis and chlamydia; however, ADAP Advocacy recommends that organizations begin having realistic conversations about its efficacy against, as well as the continued increase in propagation of, multidrug-resistant strains of gonorrhea.

These conversations need not be “sex-negative,” focusing on fear and shame-based representations of sexual activity; they do, however, need to be realistic.

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 Sexual Health Association. (2025, May 09). Learn More About Doxy PEP from Three People Who Take It. Research Triangle Park, NC: American Sexual Health Association. https://www.ashasexualhealth.org/learn-more-about-doxy-pep-from-three-people-who-take-it/

[2] Bachmann, L. H., Barbee, L. A., Chan, P., Reno, H., Workowski, K. A., Hoover, K., Mermin, J., & Mena, L. (2024, June 06). CDC Clinical Guidelines on the Use of Doxycycline Postexposure Prophylaxis for Bacterial Sexually Transmitted Infection Prevention, United States, 2024. Morbidity and Mortality Weekly Report Recommendations and Reports, 73(2): 1-8. http://dx.doi.org/10.15585/mmwr.rr7302a1

[3] Dall, C. (2026, May 11). Study shows doxyPEP’s diminished effectiveness against gonorrhea. Minneapolis, MN: University of Minnesota: Research and Innovation Office: Center for Infectious Disease Research and Policy: Antimicrobial Stewardship. https://www.cidrap.umn.edu/antimicrobial-stewardship/study-shows-doxypep-s-diminished-effectiveness-against-gonorrhea

[4] Helekal, D., Mortimer, T. D., & Grad, Y. H. (2025, July 09). Expansion of tetM-Carrying Neisseria gonorrhoeae in the United States, 2018–2024. New England Journal of Medicine, 393(2), 198-200. https://doi.org//10.1056/NEJMc2504010

[5] Sankaran, M., Glidden, D. V., Kohn, R. P., Nguyen, T. Q., Bacon, O., Buchbinder, S. P., Gandhi, M., Havlir, D. V., Liebi, C., Luetkemeyer, A. F., Nguyen, J. Q., Roman, J., Scott, H., Torres, T. S., & Cohen, S. E. (2025, January 06). Doxycycline Postexposure Prophylaxis and Sexually Transmitted Infection Trends. JAMA Internal Medicine, 185(3), 266-272. https://doi.org/10.1001/jamainternmed.2024.7178

[6] Soge, O. O., Thibault, C. S., Cannon, C. A., McLaughlin, S. E., Menza, T. W., Dombrowski, J. C., Fang, F. C., & Golden, M. R. (2025, June). Potential Impact of Doxycycline Post-Exposure Prophylaxis on Tetracycline Resistance in Neisseria gonorrhoeae and Colonization With Tetracycline-Resistant Staphylococcus aureus and Group A Streptococcus. Clinical Infectious Diseases, 80(6), 1,188-1,196. https://doi.org/10.1093/cid/ciaf089

[7] Yechezkel, M., Helekal, D., Kapadia, B., Hong, V., Pomichowski, M. E., Reyes, I. A. C., Davis, G. S., Müller, N. F., Grad, Y. H., Tartof, S. Y., & Lewnard, J. A. (2026, May 07). Durability of doxycycline effectiveness against gonorrhoea after implementation of post-exposure prophylaxis in southern California, USA: a retrospective, test-negative, observational study. The Lancet Infectious Diseases. https://www.thelancet.com/journals/laninf/article/PIIS1473-3099(26)00123-4/fulltext

National Oncology Group Realigns 340B Priorities Away from Patient-First

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

The American Society of Clinical Oncology (ASCO) released its latest policy position statement on the 340B Drug Pricing Program on May 5th, 2026 (ASCO, 2026). ASCO President, Eric J. Small, MD, FASCO, states, “…reforms focused on eligibility, transparency, and accountability are needed to reflect modern healthcare delivery and to ensure the program continues to benefit the vulnerable people it was designed to help.” But why?

Despite this statement, some of their new positions have raised eyebrows among 340B reform advocates, staking out positions that seem less designed to deliver on transparency and accountability, and more aligned with profitability. Ted Okon, who serves as the executive director of the Community Oncology Alliance, and Dr. Lucio Gordan, a medical oncologist and hematologist with Florida Cancer Specialists & Research Institute, expressed their disagreement in a strongly worded op-ed published in The Wall Street Journal only days after ASCO’s announcement, which reads, in part:

“Expanding participation in a flawed program isn’t reform. It simply broadens access to the same distorted financial incentives that have fueled consolidation, higher costs and migration of cancer care into more expensive hospital settings.”

Photo Source: The Wall Street Journal

One ASCO’s “new” positions involve the proliferation of child sites—standalone locations affiliated with a larger healthcare provider but not on its main campus.

In its statement, ASCO asserts that, “Independent oncology practices with multiple locations should be able to register a child site for the 340B program if they bill under the same Tax ID number as the eligible parent practice.”

The problem with this is that child sites are not always located in areas that serve the populations that 340B covered entities are obligated to serve: lower-income, uninsured, and underinsured patients.

For example, Bon Secours Mercy Health’s Richmond Community Hospital in Richmond, VA, closed its intensive care unit in 2017, yet it still managed to have the highest profit margins of any hospital in Virginia. While cutting services and supplies, former Bon Secours executives, doctors, and nurses accused the company of reaping the 340B revenue profits from communities like Richmond and reinvesting them in wealthier—and Whiter—communities (Thomas & Silver-Greenberg, 2022).

Photo Source: ADAP Advocacy

Proving this, however, is difficult when it comes to hospital systems, as there are zero public reporting requirements for 340B revenues for hospitals, and it becomes even more labyrinthine when 340B eligibility is extended across child sites.

ADAP Advocacy argues that each child site should be able to prove its eligibility on its own merits, without those revenues being redirected to a larger organization that can then redistribute those funds to areas outside the 340B remit.

Another area where ASCO runs its transparency argument afoul relates to its call to allow unlimited numbers of contract pharmacies:

“Covered entities should be able to contract with multiple pharmacies, with caps on administrative fees, to support rural and underserved areas and ensure savings are preserved for patient care.”

The recent explosion in the number of covered entities and contract pharmacies has exacerbated the issue of manufacturers encountering duplicate discounts. Duplicate discounts occur when drugs provided to Medicaid beneficiaries (i.e., patients) are subject to discounted prices under the 340B program and are also eligible for Medicaid rebates—when drug manufacturers pay rebates to states as a condition for the federal contribution to Medicaid spending for the manufacturers’ outpatient drugs (Nguyen & Suresh, 2024). This overlap means manufacturers risk providing duplicate discounts when they are legally required to provide either a 340B program drug price or a rebate to state Medicaid programs (Health Resources & Services Administration, 2020).

Photo Source: HRSA | Paul Shank

To combat this risk, the U.S. Department of Health and Human Services (HHS) and CMS created the Medicaid Exclusion File (MEF)—a list of covered entities that use 340B drugs for Medicaid beneficiaries under the Fee-For-Service (FFS) model. Once registered on the MEF, covered entities must notify the agency if they intend to use 340B drugs for Medicaid beneficiaries, and states then exclude claims from those registered providers from their rebate invoices to manufacturers.

The problem, however, is that the MEF applies only to FFS Medicaid models, and not to Medicaid MCOs. Unlike FFS models, which are based on reimbursement for individual services, MCOs are generally paid under a capitated model that pays each plan a set amount per beneficiary each month. As states increasingly contract with MCOs to manage their state Medicaid benefits, the expansion of drug dispensing by contracted pharmacies under the MCO model makes it more difficult for states to identify patients covered by MCOs and to track whether a 340B-discounted drug was dispensed to those patients (Nguyen & Suresh, 2024).

In addition to these changes, ASCO also proposes a new eligibility formula, called the Indigent Care Ratio (ICR). This ratio, they argue, would allow 340B eligibility to be extended to community-based, non-hospital-affiliated providers, such as independent oncology practices:

More than half of Americans receive cancer care in community-based oncology practices,” said Dr. Small. “These practices form the backbone of cancer care delivery in many rural and underserved areas, where they are often patients’ only access to such care (ASCO, 2026).

Using an ICR, ASCO argues, would allow practices to meet a specific threshold for providing care to Medicaid, uninsured, and dual-eligible patients. While the ICR makes sense in theory, its impacts definitely need further study before any implementation. ADAP Advocacy is concerned that this proposed formula, like most other formulas designed to expand access under the 340B Program, will run amok by entities trying to scheme profitability. It could further compound an existing problem by driving up the cost of cancer care, as “the current financial incentives within the 340B program may be driving higher utilization of specific outpatient medications” (Access Forum, 2026).

Photo Source: American Journal of Managed Care

There is significant overlap in advocacy values and policy priorities between the HIV and oncology patient communities, fostering greater collaboration. It has led to greater alignment on key issues, such as protecting Medicare’s six protected classes, outlining concerns about the adverse impact of Medicare’s Drug Pricing Negotiation Program on patient access, and reforming the 340B Program. In each case, that alignment has maintained one paramount priority: patients. Sadly, ASCO’s revised 340B priorities fall outside of that patient-first priority.

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] Access Forum. (2026, February 15). The Hidden Cost of 340B: How Drug Pricing Programs Impact Cancer Care. https://theaccessforum.org/learning-hub/the-hidden-cost-of-340b-how-drug-pricing-programs-impact-cancer-care/ 

[2] American Society of Clinical Oncology. (2026, May 05). ASCO Updates Policy Statement on 340B Drug Pricing Program. Alexandria, VA: American Society of Clinical Oncology: News & Initiatives: Policy New Analysis. https://www.asco.org/news-initiatives/policy-news-analysis/asco-updates-policy-statement-340B-drug-pricing-program

[3] Health Resources and Services Administration. (2020, July). Duplicate Discount Prohibition. Washington, DC: United States Department of Health and Human Services: Health Resources Services Administration: 340B Drug Pricing Program: Program Requirements: Duplicate Discount Prohibition. https://www.hrsa.gov/opa/program-requirements/medicaid-exclusion

[4] Nguyen, T. & Suresh, R. (2024, March 04). What You Need to Know About 340B Duplicate Discounts. Washington, DC: Edgeworth Economics: The Antitrust Prescription. https://www.edgewortheconomics.com/antitrustprescription-340B-duplicate-discounts

[5] Okon, T. & Gordan, L. (2026, May 15). Expanding 340B Won’t Fix a Broken System. The Wall Street Journal. https://www.wsj.com/opinion/expanding-340b-wont-fix-a-broken-system-8c621229?st=BPngEs&reflink=desktopwebshare_permalink 

[6] Thomas, K. & Silver-Greenberg, J. (2022, September 24). How a Hospital Chain Used a Poor Neighborhood to Turn Huge Profits. New York, NY: The New York Times: Health. https://www.nytimes.com/2022/09/24/health/bon-secours-mercy-health-profit-poor-neighborhood.html