NASTAD Releases 2026 ADAP Monitoring Report: Warning Signs Ahead

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

The National Alliance of State and Territorial AIDS Directors (NASTARD) has released its annual National Ryan White HIV/AIDS Program (RWHAP) Part B ADAP Monitoring Report. Highlights from the report indicate that, while the program is achieving the goal of helping ADAP recipients suppress their HIV, the failure of governments to adequately fund state programs and those programs’ increasing reliance on drug rebates imperils the lives of those recipients (NASTAD, 2026a).

Photo Source: NASTAD

The 2026 ADAP Monitoring Report includes findings from Fiscal Year 2024 (FY2024) and Calendar Year 2024 (CY2024) and relies on state and territorial ADAPs to respond to NASTAD’s inquiries about their programs to ensure that the information provided therein is as accurate as possible. That said, 2 U.S. states (Mississippi and West Virginia) and 7 territories (American Samoa, the Federated States of Micronesia, Guam, Marshall Islands, the Northern Mariana Islands, the Republic of Palau, and the U.S.).S. Virgin Islands) failed to respond to these inquiries.

What’s Working Well

Viral Suppression

87% of ADAP recipients in FY/CY2024 achieved viral suppression. This is a considerable improvement over the 74% suppression rate in FY/CY2024 and much better than the national suppression rate of 67%.

HIV suppression rates in the United States have consistently lagged behind those of economically comparable nations (Figure 1). Compared to similar nations, the U.S. HIV viral suppression rate tends to fluctuate between 57% and 67%, while other nations range from 72% (Canada) to 92% (United Kingdom). Persons Living with HIV/AIDS (PLWHA) who are enrolled in ADAP have achieved viral suppression rates that allow the U.S. to “compete” with other nations.

The primary difference between the U.S. and other nations is that those nations provide universal healthcare coverage, allowing patients to rest assured that their HIV medications will be covered. Comparatively, PLWHA in the United States must contend with significant barriers to accessing HIV care and treatment due to our nation’s reliance on a for-profit healthcare system that prioritizes profits over health outcomes. The ADAP program has allowed patients similar surety that they will have access to the medications they need to live healthy, productive lives

Figure 1 - HIV Viral Suppression Rate in the U.S. Lowest Among Comparable High-Income Countries

Photo Source: KFF

Whom ADAP Served in FY/CY2024

In CY2024, ADAPs served 257,644 individual clients across 49 reporting jurisdictions, acting as the primary access point for nearly one-quarter (23%) of the 1.13 million people aged 13 years or older living with diagnosed HIV in the United States at the end of 2023.

This represents a 7.5% increase over CY2019 levels, and NASTAD notes that this increase underscores patients’ growing reliance on the program despite the full implementation of the Affordable Care Act (ACA).

In FY/CY2024, 40% of all ADAP program clients earned 100% or less of the Federal Poverty Level (FPL), and 65% earned 200% or less.

Additionally, nearly half of all ADAP clients (43%) are People of Color (POC), with 38% Black, slightly lower than the 40% who were Black in CY2019. 36% of ADAP clients identify as Hispanic/Latine, a significant increase from 28% in CY2019.

Finally, the majority of ADAP clients (55%) were aged 45 or older, with the proportion of clients aged 65 or older increasing from 9% in CY2019 to 14% in CY2024.

NASTAD notes that the continued “greying” of ADAP enrollees will necessitate “…robust coordination between ADAPs and Medicare to ensure seamless coverage for the aging caseload.”

How ADAP Clients Are Served

Because the AIDS Drug Assistance Program is federally funded but state-administered, each state is allowed to determine how it serves ADAP clients. The traditional ADAP program provides full-pay medication coverage for clients, on which 47% rely.

Since the passage of the Affordable Care Act (ACA), however, the Health Resources Services Administration (HRSA) has allowed state ADAPs to use funds to purchase commercial health insurance coverage for ADAP clients and to reimburse those with employer-sponsored insurance coverage. 41% of clients across the United States rely on the ADAP program for said coverage.

Additionally, 12% of clients rely on a combination of full-pay and insurance support to address critical coverage gaps between drug formularies.

Trouble on the Horizon

In addition to the positive impacts ADAPs have had on clients, significant issues loom over state and territorial programs that threaten their solvency and continued effectiveness.

Rising Costs

The most pressing concerns faced by state ADAPs is that healthcare costs have risen exponentially and are likely to continue rising as a result of both Congressional inaction to increase federal funding for RWHAP and the deliberate refusal of Congressional Republicans to extend the enhance premium tax credits implemented by the American Rescue Plan Act of 2021 (ARPA) and extended by the Inflation Reduction Act of 2022 (IRA).

These tax credits were implemented to lower ACA Marketplace premiums for all patients, and Congress’s refusal to extend them resulted in a 21.7% increase in Marketplace premiums for benchmark second-lowest-cost Silver plans and 6%- 7% increases in employer-sponsored insurance premiums (Holahan, O’Brien, & Kennedy, 2025).

These premium increases highlight what many advocates have argued since the passage of the ACA: The ACA was never likely to control insurance costs because no limits were placed on annual premium price increases.

The primary failure of the American healthcare system is the lack of price controls, stemming from its reliance on the economic myth that companies will charge only “what the market will bear.” The “market” this theory relies on is not the patients who need care, but rather what insurers and government payors are willing to pay.

For-profit entities do not, in fact, care whether or not patients can afford the care they need; that’s not their purpose. Their purpose is to generate profits for their companies and their shareholders.

This results in a system where patients have to forego care and potentially die in the richest nation on the planet.

For ADAPs, these increased premiums pose significant threats to annual budgets, which increasingly rely on medication rebates to fill their coffers.

For nearly a decade, federal funding for ADAP has remained largely flat despite rising costs. In fact, federal funding has not accounted for more than 50% of annual ADAP funding since 2008 (Figure 2). Meanwhile, rebates now account for more than 50% of annual ADAP budgets.

Figure 2 - Total ADAP Budget, By Source, FY1996–FY2024

Photo Source: NASTAD

This places ADAPs at significant risk of being unable to continue providing the level of care and services they offer due to a revenue mechanism subject to “…intense market and regulatory volatility.”

What does this phrase mean?

Essentially, rebates rely on two things: high drug list prices and low 340B purchase prices. Under the rebate model, programs purchase medications at full list price and are reimbursed by pharmaceutical manufacturers for the difference between list price and 340B purchase price.

But what happens when price controls, such as those implemented under the Medicare Drug Negotiation Program created by the IRA, are introduced?

The purpose of the Medicare Drug Price Negotiations is to essentially limit what pharmaceutical manufacturers can charge the federal Medicare program for their medications. This means that a drug with an annual Wholesale Acquisition Cost of $36,000 may be forced to sell its medication to Medicare for $16,000 per year, which significantly reduces the total rebate amount that ADAP pharmacies may receive.

This doesn’t just apply to medications that treat HIV, but to every medication eligible for 340B rebates.

The reality is that, if patients get their way, government price controls are all but assured.

73% of patients surveyed in 2023 said that there was not enough government regulation when it comes to limiting the price of prescription drugs, with 67% or more of respondents agreeing with that sentiment across party affiliation (82% of Democrats, 67% of Independents, and 68% of Republicans; Sparks et al., 2024).

This finding wasn’t a one-time fluke; patients have long been in favor of significant increases in government regulations as they relate to controlling prescription drug prices, with 88% of patients being in favor of limiting annual drug price increases to no more than the rate of inflation, 88% of patients being in favor of the government negotiation drug prices for the Medicare program, 78% being in favor of importing drugs from Canada, 72% being in favor of increasing taxes on pharmaceutical companies that refuse to negotiate prices with the federal government, 63% being in favor of increases taxes on companies who drug prices are too high, and 57% being in favor of ending tax breaks given to drug companies for advertising spending.

What this could mean for state ADAPs is that, with increased patient fury at the healthcare industry and systems, in general, elected officials are more likely to begin listening to patients than to industries. Should significant price controls be implemented, the rebate model could collapse, leaving ADAPs facing the loss of 50% or more of their annual operating budgets.

How Are ADAPs Responding

Faced with the various funding hurdles, state and territorial ADAPs are beginning to implement “cost containment” measures (translation: cuts) that will result in significant negative outcomes for the patients who rely upon ADAP for their HIV medications.

These “cost containment” measures include (but are not limited to):

• Decreasing income eligibility requirements so that fewer PLWHA are eligible for benefits
• Delaware eligibility decreased from 500% of the FPL to 350%, effective for all clients as of April 1st, 2026, impacting ~176 patients
• Florida decreased from 400% to 130% of the FPL effective March 1st, 2026, impacting ~16,000 patients
• Kansas decreased from 400% to 250% of the FPL to receive ACA premium assistance, while maintaining the 400% limit for full-pay medication coverage, impacting ~230 patients
• Pennsylvania decreased from 500% to 350% of the FPL effective October 1st, 2026, impacting ~1,592 patients
• Rhode Island decreased from 500% to 400% of the FPL effective March 1st, 2026, impacting ~51 clients
• The following states are considering additional changes to income eligibility:
• Arkansas, Louisiana, New Jersey, Rhode Island, Virginia, & Washington State
• Reducing RWHAP Part B funding for core medical/support services
• Implemented in Arkansas, Connecticut, Delaware, Kansas, Louisiana, Michigan, Pennsylvania, Rhode Island, Virginia, & Wisconsin
• Implementing or reimplementing 6-month recertification requirements
• Implemented in Alaska, Oklahoma, & Rhode Island
• Introducing per-patient expenditure caps
• Implemented in Arizona, Colorado, Delaware, the District of Columbia, & Nevada
• Reducing formulary coverage for both HIV-related and non-HIV-related medications
• Implemented in Arizona, Florida, Louisiana, Michigan, Nevada, & Pennsylvania
• Decreasing, restricting, or eliminating insurance premium assistance
• Implemented in Florida, Michigan, Montana, Oklahoma, & Wisconsin (NASTAD, 2026b)

HIV advocates and activists are also concerned about the potential reintroduction of state ADAP program waitlists, with Arkansas, Louisiana, & New Jersey reporting that they are considering implementing waitlists (NASTAD, 2026b).

The reality of this landscape is that trouble is brewing for RWHAP and the PLWHA who depend upon its various parts and programs to stay alive. ADAP Advocacy will continue to monitor and report on circumstances as they develop.

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] Holahan, J., O’Brien, C., & Kennedy, N. (2025, December 18). Understanding the Extraordinary Increase in ACA Premiums in 2026. Washington, DC: Urban Institute: Research: Publication. https://www.urban.org/research/publication/understanding-extraordinary-increase-aca-premiums-2026

[2] KFF. (2025, January 24). HIV Viral Suppression Rate in U.S. Lowest Among Comparable High-Income Countries. Washington, DC: KFF: HIV/AIDS. https://www.kff.org/hiv-aids/hiv-viral-suppression-rate-in-u-s-lowest-among-comparable-high-income-countries/

[3] National Alliance of State and Territorial AIDS Directors. (2026a). 2026 National Ryan White HIV/AIDS Program Part B ADAP Monitoring Project Annual Report: Stabilizing the Safety Net: Stewardship and Outcomes in a Volatile Landscape. Washington, DC: National Alliance of State and Territorial AIDS Directors. https://nastad.org/2026-rwhap-part-b-adap-monitoring-report

[4] National Alliance of State and Territorial AIDS Directors. (2026b, February 09). NASTAD ADAP Watch - February 2026. Washington, DC: National Alliance of State and Territorial AIDS Directors. https://nastad.org/resources/nastad-adap-watch-february-2026

[5] Sparks, G., Kirzinger, A., Montero, A., Valdes, I., & Hamel, L. (2024, October 04). Public Opinion on Prescription Drugs and Their Prices. Washington, DC: KFF: Health Costs. https://www.kff.org/health-costs/public-opinion-on-prescription-drugs-and-their-prices/

The Medical Monopolies Monopolizing Modern Medicine

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

Imagine a scenario where every aspect of your healthcare is owned by the same company—your health insurance, your doctor, your pharmacist, and the company that manufactures the medication you’ve just purchased. For many Americans, this is already a reality.

Enter CVS Health.

Photo Source: Barchart

When most people hear “CVS,” they think of the national chain of pharmacies with over 9,000 locations across the United States. They think of either filling a prescription, buying a holiday greeting card, or buying other small retail items.

What they don’t often think of is the fact that CVS Health doesn’t just own pharmacies; they own:

• Aetna, the health insurance giant serving over 36 million Americans;
• Oak Street Health medical clinics, the American Association of Retired Persons (AARP)-approved primary care provider for older and disabled Americans on Medicare;
• CVS Caremark, the pharmacy benefit manager (PBM) that negotiates drug prices that patients pay and which processes nearly 30% of all prescriptions in the United States in a given year; and,
• Cordavis, a relatively new pharmaceutical company created by CVS to manufacture biosimilar medications.

As Representative Alexandria Ocasio-Cortez (D-NY-14), during a hearing in the Health Subcommittee of the Committee on Energy and Commerce, put it when questioning CVS Health’s CEO, “Mr. Joyner, this is quite a bit of market concentration. Wouldn't you agree?” (AOC, 2026).

Joyner’s response was typical of companies that control a monopoly:

“No, I wouldn't agree that it's market concentration. I would suggest it's a model that works really well for the consumer.” (AOC, 2026).

CVS Health’s former CEO, Karen S. Lynch, very succinctly summed up the company’s strategy in 2024:

Many of our four million Medicare Advantage members can have access to our Oak Street clinics. We have a captive audience with benefit designs that can support the physicians [in the clinics]. We can drive patients to [the Oak Street health centers] (Japsen, 2024).

The often glib responses from health insurance CEOs did not go unnoticed in the Senate.

On February 11th, Senators Elizabeth Warren (D-MA) (seen right) and Josh Hawley (R-MO) (seen left) introduced the “Break Up Big Medicine Act of 2026,” a bill that would prevent PBMs, insurers, and prescription drug and medical device wholesalers from being owned by the same company.

Photo Source: The Wall Street Journal

The “Break Up Big Medicine Act of 2026” would:

• Prohibit a parent company from owning a medical provider or management services organization and a PBM or an insurer;
• Prohibit a parent company of a prescription drug or medical device wholesaler from owning a medical provider or management services organization;
• Require that a company in violation of these provisions come into compliance within one year of the bill’s enactment;
• Create automatic penalties if a company fails to comply in a timely manner, including disgorgement of profits and forced sales of assets;
• Enable the Federal Trade Commission (FTC), Department of Health and Human Services, Department of Justice (DOJ), state attorneys general, and private parties to bring lawsuits against violators; and
• Allow the FTC and DOJ to review and block future actions that would recreate the conflicts of interest prevented by the bill (Elizabeth Warren, 2026).

Essentially, this bill aims to break up healthcare monopolies in the United States.

About the legislation, Senator Hawley said:

Americans are paying more and more for healthcare while the quality of care gets worse and worse. In their quest to put profits over people, Big Pharma and the insurance companies continue to gobble up every independent healthcare provider and pharmacy they can find. Working Americans deserve better. This bipartisan legislation is a massive step towards making healthcare affordable for every American (Josh Hawley, 2026).

Senator Warren echoed:

There’s no question that massive health care companies have created layers of complexity to jack up the price of everything from prescription drugs to a visit to the doctor. The only way to make health care more affordable is to break up these health care conglomerates. Our bill would be a monumental step towards ending the stranglehold that corporate giants have on our broken health care system (Elizabeth Warren, 2026).

The CVS Health example is a classic case of a monopoly that should have been broken up before it even got started… but, since the 1980s, enforcement of antitrust and monopoly laws in the U.S. has been… spotty, at best.

Over time, more and more aspects of American society, life, and commerce have become “vertically integrated,” meaning that businesses—particularly in the technology and health sectors—have gone out of their way to purchase and control multiple stages and steps of supply chains.

According to many of the businesses that control these monopolies (e.g., Google, Amazon, Meta), these purchases are “great for consumers” because they centralize purchasing and make things “easier.”

As Mr. Joyner from CVS Health would argue, “…it's a model that works really well for the consumer.”

Matt Toresco, Founder and CEO of Archo Advocacy and Co-Founder of We The Patients, is a leading voice in patient advocacy. Toresco further highlights this issue:

Vertical integration industrializes the problem. It does not create it. The deeper issue is that we built a system where financial entities control access to care without carrying medical liability for the consequences. Insurers shape treatment through coverage design. Step edits. Fail first protocols. Closed formularies. Technically, they do not practice medicine. Operationally, they influence it every day. If a delay harms a patient, the physician carries the malpractice risk. The insurer carries none. That asymmetry drives everything. You can reduce integration. If you do not align authority with accountability, you will reorganize power instead of reforming it (Toresco, 2026).

Photo Source: AntiTrust Law Journal LinkedIn

A working paper published in the Antitrust Law Journal neatly summed up the lack of enforcement:

The decline of antitrust enforcement from the 1970s to the present was not achieved through legislative reform in response to public demand. It was the result of decisions made mostly in the shadow by politically unaccountable officials—judges and regulators—whose views of antitrust at the time of their appointment were (in most cases) not publicly known or perhaps even clear in their own minds.

To explore the potential forces behind this weakening, we considered two alternative hypotheses. The first is that these actions were the result of an enlightened elite of technocrats who promoted efficiency against the will of a Congress dominated by irrational populistic hostility to big business The alternative view is that big business drove a steady decline in antitrust enforcement against the public will to benefit itself. While we have no smoking gun, the evidence we collected provides more support to the second hypothesis than the first (Lancieri, Posner, & Zingales, 2022).

So, will the Break Up Big Medicine Act succeed?

Well, it’s hard to say.

But it’s a great first step.

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] Alexandria Ocasio-Cortez. (2026, January 22). ICYMI: Ocasio-Cortez Calls Out CVS Health’s Corporate Strategy to Monopolize Patient Care. Alexandria Ocasio-Cortez: Press: Press Releases. https://ocasio-cortez.house.gov/media/press-releases/icymi-ocasio-cortez-calls-out-cvs-healths-corporate-strategy-monopolize

[2] Elizabeth Warren. (2026, February 10). Warren, Hawley Introduce Bipartisan Bill to Break Up Big Medicine. Elizabeth Warren: Newsroom: Press Releases. https://www.warren.senate.gov/newsroom/press-releases/warren-hawley-introduce-bipartisan-bill-to-break-up-big-medicine

[3] Japsen, B. (2024, February 08). CVS Stays With Clinic Expansion Strategy Despite Walgreens Woes. New York, NY: Forbes. https://www.forbes.com/sites/brucejapsen/2024/02/08/cvs-sticking-with-clinic-expansion-strategy-despite-walgreens-woes/

[4] Josh Hawley. (2026, February 11). Hawley, Warren Introduce Bill to Break Up Big Medicine. Josh Hawley. https://www.hawley.senate.gov/hawley-warren-introduce-bill-to-break-up-big-medicine/

[5] Lancieri, F., Posner, E. A., & Zingales, L. (2022, August). The Political Economy of the Decline of Antitrust Enforcement in the United States. Antitrust Law Journal, 85(2), 442-519. https://www.americanbar.org/content/dam/aba/publications/antitrust/journal/85/2/political-economy-decline-of-enforcement.pdf

[6] Toresco, M. (2026, February 26). BREAKING UP BIG MEDICINE WON'T FIX HEALTHCARE UNTIL WE BREAK UP STATE MONOPOLIES. Charleston, SC: Archo Advocacy: Archo Advocate Brief: Posts. https://archo-advocate-brief.beehiiv.com/p/breaking-up-big-medicine-won-t-fix-healthcare-until-we-break-up-state-monopolies

Medicare Drug Price Negotiations Again Target High-Impact Prescriptions, But at what Cost?

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

The Trump Administration recently released the next round of medications selected for the Medicare Drug Price Negotiation Program, which includes 15 medications payable under Medicare Part B and/or covered under Medicare Part D, largely for the treatment of chronic diseases and cancer.

Photo Source: CMS

Of greatest concern to ADAP Advocacy is the inclusion of Biktarvy, the most commonly prescribed single-pill oral regimen to treat HIV made by Gilead Sciences, currently taken by over 430,000 people living with HIV in the United States (Gilead Sciences, 2026), or 35.8% of People Living With HIV/AIDS (PLWHA).

In June 2025, ADAP Advocacy submitted public comment to the Centers for Medicare and Medicaid Services (CMS). In this public comment, it requested that CMS create a carve-out exemption for all medications used for the treatment of HIV/AIDS in order to avoid any interruptions of service for PLWHA who rely upon Medicare for their HIV medications.

ADAP Advocacy followed up on this public comment with a sign-on letter to CMS requesting the carve-out exemption, which garnered signatures from nearly 40 organizations and received a direct response from Dr. Mehmet Oz, the current CMS Administrator.

The response?

"CMS acknowledges your recommendation to implement a carve-out exemption for all medications indicated for the treatment and prevention of HIV/AIDS; however, the statute does not specify a specific exclusion for medications used for the treatment of HIV/AIDS from selection under the Negotiation Program."

Essentially, “Sorry. Can’t help you.”

Photo Source: ADAP Advocacy

What Does Price Negotiation Mean?

As ADAP Advocacy detailed in a July 2025 blog, Medicare’s Negotiation Program essentially requires manufacturers to accept the final price after four negotiation meetings set by CMS, reject the offer, and pay a 95% excise tax on all of the medications sold to Medicare payors, or remove their products from the Medicare formularies altogether (Hammond, 2024). Because no business can feasibly accept a 95% excise tax and remain viable, manufacturers are left with the unenviable decision to either accept significant profit losses in the Medicare market or withdraw their drugs (Hopkins, 2025). This process, which is supposed to resemble a negotiation, has been characterized by many as a threat with the full force of the federal government behind it. One public health stakeholder attending ADAP Advocacy’s Health Fireside Chat last year in Minneapolis, Minnesota, called it extortion. 

For PLWHA, the inclusion of one of the most effective single-pill regimens in the history of HIV treatment on this list presents a real and present danger should Gilead Sciences determine that allowing Biktarvy to be purchased at a significant loss by Medicare payors is unacceptable.

Medicare is the 2nd-largest payor of HIV treatment and care in the United States, accounting for 39% of federal spending in 2020, and serving 28% of PLWHA (Dawson, et al., 2023).

Patient advocates continue to share their concerns over Biktarvy, or any other HIV-related product, being targeted by CMS for artificial government price controls. Among them is Aging and HIV Institute’s David “Jax” Kelly, JD, MPH, MBA. Kelly argued, “Nearly 28% of PLWH in the United States are Medicare beneficiaries, and most qualified through disability rather than age… [t]his unique cost profile reflects both the effectiveness and the financial burden of HIV treatment. Interruptions in ART jeopardize not only individual health but also public health goals. Sustained viral suppression—essential to ending the epidemic—depends on reliable, affordable access to medications.”

ADAP Advocacy will follow up with its aforementioned communications with CMS by submitting public comments in response to its request for information about selected drugs and their therapeutic alternatives, because the inclusion of an antiretroviral therapeutic “is playing with fire,” as ADAP Advocacy’s CEO has noted on numerous occasions.

Photo Source: Andreas Marquardt/Shutterstock

What Can Patients Do?

Please find information below on how you can get involved:

[From CMS]:

The Negotiation Program enables Medicare to directly negotiate the prices of certain high-cost drugs. The current cycle of negotiation and renegotiation is underway, and CMS wants to hear directly from patients, caregivers, clinicians, and others to gather input relevant to the selected drugs.

CMS invites you to rally the communities you represent to share information about the public engagement events, including a virtual livestreamed town hall meeting focused on the clinical considerations related to the selected drugs, and private (i.e., not livestreamed or open to press or general public) virtual patient-focused roundtable events, one for each selected drug, for patients, patient advocacy organizations, and caregivers.  

Take Action

• Learn more about the drugs selected for the current cycle of negotiation and renegotiation here.
• Use communication tools available here so that your organization can leverage your various communication channels to share information about these opportunities:
• Complete the Drug Price Negotiation Information Collection Request (ICR).
• Register for public engagement events here. 

Key Dates

• The Drug Price Negotiation ICR is now available, and responses are due by March 1, 2026. It is worth noting that for patients wanting to submit public comments, questions 28-33 are the patient- or caregiver-focused input (so don’t get overwhelmed by the length of the online form)
• Drugs selected for the upcoming cycle of negotiation and renegotiation were announced on January 27, 2026, and registration for the public engagement events is open now until March 6, 2026.
• Public engagement events for Biktarvy include:
• Roundtable event on Monday, April 6 from 2:30 – 4:30 p.m. ET 
• Town Hall Meeting on Wednesday, April 22, Session 1 from 10:30 a.m. – 12 p.m. ET

Photo Source: Portland.gov 

Registration for the opportunity to speak at the public engagement events is now open and will close at 11:59 p.m. PT on March 6, 2026.

• To register for a roundtable event, click here. 
• To register for the town hall meeting, click here. 

Reach out to IRARebateandNegotiation@cms.hhs.gov with any questions, using the subject line “Public Engagement.”

ADAP Advocacy urges patients and patient advocates to weigh in. While financial outlays may be high for PLWHA due to treatment costs, the financial impacts of treatment interruption are far higher. While treatment cessation for any disease state can cause serious complications, the nature of the HIV retrovirus is such that it can quickly mutate to develop resistance to a treatment regimen if that regimen is suddenly halted. This can create a strain of HIV that is multidrug-resistant (MDR-HIV), making the virus more difficult and significantly costlier to treat–and result in premature death. CMS targeting an HIV-related therapeutic signals a threat to AIDS exceptionalism, and it cannot be left to chance.

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

References:

[1] Centers for Medicare and Medicaid Services. (2026, January). Medicare Drug Price Negotiation Program: Selected Drugs for Initial Price Applicability Year 2028. Washington, DS: United States Department of Health and Human Services: Centers for Medicare and Medicaid Services. https://www.cms.gov/files/document/factsheet-medicare-negotiation-selected-drug-list-ipay-2028.pdf

[2] Dawson, L., Kates, J., Roberts, T., Cubanski, J., Neuman, T., & Damico, A. (2023, May 27). Medicare and People with HIV. KFF: HIV/AIDS. https://www.kff.org/hivaids/issue-brief/medicare-and-people-with-hiv/

[3] Gilead Sciences. (2026). Biktarvy. Foster City, CA: Gilead Sciences: Biktarvy: About Biktarvy. https://www.biktarvy.com/about-biktarvy

[4] Hammon, J. (2024, August 19). Price controls – bad policy, big problems. Washington, DC: Paragon Health Institute. https://paragoninstitute.org/paragon-prognosis/price-controls-bad-policy-big-problems/

[5] Hopkins, M. J. (2025, July 10). CALL TO ACTION: HIV Medication Carve-Out Exemption from the Medicare Drug Price Negotiation Program. Nags Head, NC: ADAP Advocacy: ADAP Blog. https://adapadvocacyassociation.blogspot.com/2025/07/call-to-action-hiv-medication-carve-out.html

Florida, Once Again, Imperils the Lives of People Living with HIV/AIDS

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

The state of Florida is in the process of revamping [deconstructing] its state’s AIDS Drug Assistance Program (ADAP) to exclude nearly half of its current enrollees. That plan hit a roadblock when the Florida Department of Health ignored the state statutes governing administrative procedure, which opened it to an administrative action filed by the AIDS Healthcare Foundation (AHF). The state withdrew its proposal but plans to proceed with it…this time, actually following the rules. It represents a temporary win, but much work remains to be done to protect Floridians living with HIV/AIDS reliant on the program. The Florida Legislature appears to be taking steps to address the crisis, as both the House and Senate budget proposals call for additional funding for the drug assistance program. The Senate's budget proposal includes $118 million, while the House's plan offers only $68 million, which represents about half of the funding needed.

How This Started

The emails started circulating on January 7th, 2026 (see Figure 1):

Figure 1 - Email from an ASO

“ADAP will reduce its [Federal Poverty Level (FPL)] eligibility from 400% to 100%.”

“[Co-pay] assistance will only be provided to participants who meet the new eligibility criteria.”

“ADAP-funded insurance coverage will be discontinued.”

“Only generic medications will be covered.” *

And the panic began.

State and national organizations across the country immediately began to both panic and organize:

How can we best support patients who will lose access to their medications, as well as organizations that may face closure as a result of these changes?

The State of Florida Confirms Its Plans

By Thursday, January 8th, 2026, the state of Florida clarified its plans:

Dear Colleagues,

As you are probably aware, ADAP will be moving to a financially sustainable model to benefit the largest population of ADAP clients. We will continue to support the current model (direct dispense, CVS Caremark and insurance) for a two month period to ensure ADAP clients have ample time to seek insurance and medication assistance, if no longer eligible to receive ADAP services through the department. Following this transition period, we will move to direct medication dispensing, capping the eligible federal poverty level at 130%, as well as implementing ADAP formulary changes starting March 1, 2026.

Regarding the formulary changes, Biktarvy will be removed and Descovy will be restricted to only those with renal insufficiency (CrCl <60). All other current ART medications including Tivicay will be available. However, we will monitor cost closely and adjust if needed. A few actions to consider:

• Upon follow up visits, transition to new ART regimen such as Tivicay plus Truvada, other Truvada-based or NRTI-based regimen in combination with integrase inhibitors, or alternative class outside of integrase inhibitors. Please refer to the treatment guidelines: Initiation of Antiretroviral Therapy | NIH.
• For patients on those Biktarvy or Descovy, ensure they have adequate medication until their next clinical visit prior to March 1st.
• For Descovy, providers are required to document the reason: due to CrCl <60 or renal insufficiency on the prescription note section.

Will keep you posted on any additional changes. As always, please reach out if you have any questions.

{Source: U. Choe, personal communication, January 06, 2026}.

So, What Happened?

Florida’s controversial Surgeon General, Joseph Ladapo, stated that the cuts were necessary to prevent a “…projected $120 million shortfall” (Shepard, 2026), but state and national advocates are asking whether or not taxpayer dollars have been illegally diverted or misappropriated (Adamczeski, 2026), pointing to a recent investigation that uncovered the DeSantis Administration’s diversion of $35 million in taxpayer dollars to wage campaigns against two ballot initiatives that would have legalized recreational marijuana use (Amendment 3) and overturned the six-week abortion ban passed by the state legislature (Amendment 4; Mower et al., 2025).

What Happened Next?

Shortly after these announcements, ADAP Advocacy remained publicly quiet, but behind the scenes, it was working on two fronts to help alleviate growing concern. One route has political ties to the governor, while the other option involves potential litigation. That is all the organization has been authorized to say at this time.

AHF almost immediately filed an administrative legal action, arguing that the state of Florida failed to comply with mandatory public rulemaking processes that require it to publish a “Notice of Proposed Rule” (NPR).

Publishing an NPR starts a mandatory 21-day procedural clock during which the public may submit written comments, requests for public hearings, workshop requests, and “lower-cost regulatory alternatives” (LCRAs).

The state of Florida issued this NPR on Wednesday, February 11th.

What This Would Mean for People Living with HIV/AIDS in Florida

The “cost-containment” measures announced by the Florida Department of Health are each, by themselves, draconian cuts that would have devastating negative impacts on People Living with HIV/AIDS (PLWHA) in the state.

In its NPR, Florida proposes the following changes to the program:

Lowering the Income Eligibility Threshold from 400% of the FPL to 130% of the FPL:

In 2023, there were an estimated 123,279 PLWHA in the state of Florida, of whom 36,834 (29.9%) were enrolled in Florida’s state ADAP program (National Alliance of State and Territorial AIDS Directors, 2025).

Should Florida move ahead with its plan to lower its income eligibility cap to 130%—roughly $20,345 / year for an individual—potentially up to half of patients currently enrolled (between 16,000-20,000 PLWHA) would be disenrolled (Figure 2).

Figure 2 – Florida State ADAP Enrollees by Percentage of the Federal Poverty Level, 2024

Photo Source: ADAP Advocacy

For context, capping income eligibility at 130% would make Florida one of just 4 state ADAPs with income eligibility caps below 300% of the FPL, along with Utah (250%), Texas, and Oklahoma (both 200%; ADAP Advocacy, 2025).

Significant and Potentially Deadly Changes to the ADAP Formulary:

ADAP rules currently require that ADAP formularies include at least one medication from each class of core antivirals. The NPR issued by the state of Florida eliminates this language altogether.

Patients who remain eligible for ADAP would face significant restrictions on the medications they can take. As detailed in the email from the Florida Department of Health, the most popular and commonly prescribed medication to treat HIV/AIDS, Biktarvy, will be removed from the formulary.

Biktarvy, a single-pill oral regimen made by Gilead Sciences, is taken by over 430,000 people living with HIV in the United States (Gilead Sciences, 2026), or 35.8% of PLWHA.

By removing Biktarvy from the ADAP formulary, the Florida state government will be forcing impacted patients to transition off of the medications that are the standard of care to older, less effective multi-pill regimens in order to “contain costs.”

While this initial statement has been removed from the NPR, AHF has advised state advocates that the Florida Department of Health is separately attempting to restrict access to Biktarvy and Descovy through an informal policy outside the rulemaking process.

Dismantling the Health Insurance Premium Plus and Marketplace Premium Assistance framework:

Additionally, Florida’s plan includes discontinuing health insurance continuation payments for ADAP clients. Insurance continuation is a process that allows state ADAPs to pay for various aspects of private health insurance coverage, including those plans made available to patients on the Health Insurance Marketplace under the Affordable Care Act, and the vast majority of state ADAPs participate in some form of insurance continuation purchasing, be that through premium assistance, paying deductibles, and/or paying co-pays (Figures 3-5).

Figure 3 – State ADAP Programs That Pay Private/Marketplace Insurance Premiums, 2023

Photo Source: ADAP Advocacy

Figure 4 – State ADAP Programs That Pay Private/Marketplace Insurance Deductibles, 2023

Photo Source: ADAP Advocacy

Figure 5 – State ADAP Programs That Pay Private/Marketplace Insurance Co-Pays, 2023

Photo Source: ADAP Advocacy

In the recently filed NPR, Florida significantly narrows this framework by limiting the program to medication co-pay and deductible assistance through a limited number of contracted pharmacies.

Eliminating Part A information sharing in an effort to implement artificial administrative barriers:

Another change announced in the NPR is the removal of Ryan White Part A programs from the definition of who can issue a “Notice of Eligibility” (NOE), and the elimination of the provision that allowed Part A NOEs to satisfy ADAP (Part B) eligibility requirements.

For the uninitiated, Part A of the Ryan White Cares Act funds grants to Eligible Metropolitan Areas (EMAs) and Transitional Grant Areas (TGAs)—areas of the country with populations of at least 50,000 people that have seen between 1,000 and 2,000 AIDS diagnoses in the most recent five years.

Florida’s proposed change would require every Part A client to qualify separately for ADAP services, resulting in additional paperwork and administrative costs that increase the risk of lapses in coverage, administrative delays, and missed doses or treatment abandonment. Because of the nature of the HIV virus, missed doses or abandoning treatment can result in the mutation of the virus, creating drug-resistant strains. Lapsed treatment also assures that viral suppression will evaporate, increasing the risk of outbreaks of a multi-drug resistant strain of HIV.

Administrative burdens are a common tool used by public (in this case, the state of Florida) and private (e.g., insurance companies) payers to increase the likelihood that otherwise eligible program applicants will abandon application and/or renewal processes.

For example, in 2021, in an effort to artificially reduce its ADAP enrollment numbers, the state of Texas began requiring enrollees to recertify their eligibility in person. This was when the COVID-19 pandemic was still killing thousands of Americans each day, making this requirement potentially deadly to a patient population at severe risk of developing potentially deadly opportunistic infections, solely to serve the state’s goal of decreasing the number of enrollees to “save money.”

Limiting the types of documents acceptable for income verification:

In addition to these changes, the state of Florida is further creating administrative barriers by limiting the types of documents that can be used to verify income eligibility. This change would limit the documents available for use to W-2s, tax returns, pay stubs, unemployment documents, and Medicaid award letters.

This creates a barrier for gig workers (e.g., DoorDash drivers, Uber drivers, contractors), people paid directly in cash, and others with informal financial support by preventing them from submitting Form 1099s, contracts, or other income documents.

Changing program language to eliminate prioritization criteria, waitlist rules, and notice requirements:

Another change introduced in Florida’s NPR would revise the standard language about all program enrollment and services being subject to the availability of funds to exclude additional language that detailed prioritization criteria, rules related to the creation of a waitlist, or notice to enrollees that their coverage may or will be eliminated should funds be reduced or unavailable.

This essentially means the state can simply cease services without providing enrollees with sufficient notice to seek alternative patient assistance.

What Can Advocates Do?

The AIDS Healthcare Foundation has recommended that individuals and organizations follow the following strategy:

Figure 6 – What You Should Do Right Now

Photo Source: AHF

{Source: AIDS Healthcare Foundation, 2026}

Individuals may also directly contact their legislators using the resources below:

To find your representative in the Florida House of Representatives:

https://www.flhouse.gov/FindYourRepresentative

To find your representative in the Florida Senate:

https://www.flsenate.gov/Senators/Find

This Friday (February 20th) at 9 am ET, advocates can join a HIV Patient Access and Advocacy Strategy Convening, hosted by The AIDS Institute. 

In the meantime, ADAP Advocacy announced this week that it is rescinding its three-year travel ban to the state of Florida. This travel ban applied to ADAP board members, staff, consultants, and scholarship-funded patient advocates and precluded hosting any patient advocacy events, such as Fireside Chats, in Florida.

The severity of potential outcomes for PLWHA in the state of Florida “…warrant[s] our change in strategy,” said ADAP Advocacy CEO Brandon M. Macsata. ADAP Advocacy will continue to monitor this situation and will report any additional information as it becomes available.

*This restriction hasn't appeared in any of the formal notices, despite it initially being floated by the state.

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

References:

[1] Adamczeski, R. (2026, January 20). Ron DeSantis will have 'blood on his hands' if HIV funding isn't restored, Democratic chair says. Los Angeles, CA: The Advocate: Politics. https://www.advocate.com/politics/florida-desantis-hiv-medication-funding

[2] ADAP Advocacy. (2025). ADAP Directory. Nags Head, NC: ADAP Advocacy. https://adap.directory/directory

[3] Gilead Sciences. (2026). Biktarvy. Foster City, CA: Gilead Sciences: Biktarvy: About Biktarvy. https://www.biktarvy.com/about-biktarvy

[4] Mower, L., Glorioso, A., & Garcia, J. (2026, January 19). DeSantis admin diverted child welfare and medical funds for consultants, ads. Miami, FL: Miami Herald: News: Florida Politics. https://www.miamiherald.com/news/politics-government/state-politics/article313630394.html

[5] National Alliance of State and Territorial AIDS Directors. (2025). 2025 Annual Report. Washington, DC: NASTAD. https://nastad.org/2025-rwhap-part-b-adap-monitoring-report

[6] Shepard, S. (2026, January 21). New Florida AIDS drug rules may leave 15,000 without HIV treatment options, Democrats say. West Palm Beach, FL: CBS 12: News: Local. https://cbs12.com/news/local/floridas-revised-hiv-treatment-eligibility-raises-questions-from-democratic-lawmakers-south-florida-news-ryan-white-aids-drug-assistance-program-adap-reps-lois-frankel-debbie-wasserman-schultz-and-sheila-cherfilusmccormick-zoom-meeting-january-21-2026

Why Modifying Protected Drug Classes Creates a Slippery Slope for Patients Living with HIV

By: Scott Bertani, Director of Advocacy at HealthHIV

As a Person living with HIV who was diagnosed in Denver in the mid-1990s, during a period when treatment options were limited and access was fragile (to say the least), I relied on the Denver Blue Card for my care and access to medications and, during particularly precarious periods, on donation houses and informal community networks to stay alive when formal systems fell short. I lost many friends during those years, and I remember clearly what it meant to live before truly effective HIV antiretroviral therapy existed. The Colorado Department of Health Care Policy and Financing’s (HCPF)  consideration of modifying protected drug classes and allowing the use of prior authorization for select drugs threatens to undermine that progress.

Photo Source: Manatt | January 27, 2026

In 1996, when protease inhibitors first came online, they did more than change treatment guidelines—they saved people who would not have been alive the following month. The shift was so profound that one of our local bars, Proteus, was euphemistically renamed by many of us as "Protease," reflecting how seismic that moment felt within the community. 

Back then, cherished friends and bar owners—many connected through BJ’s and the Carousel Ball—helped establish the Tavern Guild as a way to formalize what BJ’s, Mike’s on Broadway, Charlie’s, Blush & Blu, and similar LGBTQ-safe spaces had long done informally—strengthen access to community-based resources, collective buying power, mutual aid, and care. Their work reinforced what many of us already knew from lived experience: progress in HIV has never been driven by medicine alone, but by the constant interaction between clinical innovation, policy decisions, and community infrastructure. That history—contemporary with the Denver Principles—shapes how I read Policy Action 6: not as an abstract cost-containment proposal, but as a set of decisions that land on real people whose health, stability, and longevity depend on continuity of care. It’s why—I feel—that the Colorado Department of Health Care Policy and Financing’s (HCPF) consideration of modifying protected drug classes and allowing prior authorization for select HIV drugs risks reintroducing access barriers we have long since left behind.

(With that, I relinquish the soapbox and turn to Colorado’s HCPF proposed Policy Action 6—grounded in lived-experience and the principle that has guided HIV policy and advocacy for decades: "Nothing about us, without us").

Across HIV prevention and care, we see the same pattern repeat: funding debates occur in one lane, policy design in another, implementation somewhere else, and the consequences show up downstream with patients, providers, and communities. The uncomfortable question is who ultimately absorbs the cost—both quantitatively and qualitatively—when that chain breaks. 

Cost growth is a legitimate concern. It has long been debated across ecosystems affecting HIV treatment—by Prescription Drug Affordability Boards; Medicaid and provider and therapeutics committees; Medicare benefit designers; AIDS Drug Assistance Programs (ADAPs); the Affordable Care Act Marketplace; employer-sponsored coverage; and others. In response, states and payers have operationalized those concerns through cost-containment mechanisms such as formulary redesign, eligibility adjustments, and increased scrutiny of high-cost antiretroviral therapies, particularly widely used single-tablet regimens that account for a significant share of HIV drug spending, as reflected in recent IPAY 2028 actions under the Inflation Reduction Act.

Policy Action 6 emerges from this same cost-growth context. However, reintroducing prior authorization and step therapy for communicable disease medications—especially HIV drugs—introduces predictable treatment delays and administrative barriers that undermine adherence and viral suppression. Any savings analysis, including evidence-based spending and utilization patterns, should therefore account for downstream clinical and system costs, not just pharmacy spending and rebate leverage.

Photo Source: PharmacyTimes.com | Image Credit: © piter2121

In practice, utilization management often shifts costs out of the pharmacy benefit and into care coordination, emergency coverage, and re-engagement efforts. Those costs do not disappear; they reappear elsewhere in the system and are shouldered by Ryan White providers, safety-net clinics, and public health programs. In those settings, administrative delays, regimen uncertainty, and coverage churn undermine stability before it is ever achieved. That disruption is managed by Title XIX targeted case management, Ryan White medical case management and non-medical supportive services, and Part C clinic staff and administrators. This list is not exhaustive and is rarely reimbursed at a level that reflects improved health outcomes.

While Policy Action 6 is framed as a measured return to utilization management that would apply prospectively after July 2027 and preserve continuity for patients deemed "stable," the greatest disruption from prior authorization and step therapy occurs upstream—during initiation or rapid starts, regimen switches and re-initiation, and early treatment.

As a result, these programs must devote—often divert—additional staff time to care coordination, enrollment troubleshooting, and compliance management. That operational burden adds strain through burnout, retention challenges, and reduced workforce readiness, particularly when churn occurs at both the reimbursement level and the policy level, including through federal and HRSA requirements.

Cost containment is vital to the implementation of a healthy Colorado, including for people enrolled in public assistance programs, as the Department of Health affirms. However, rebate strategies that rely on utilization management function by introducing administrative hurdles—not by changing clinical care—and those hurdles directly affect whether people remain on treatment and stay virally suppressed.

In many ways, this is a Palisade peaches–to–Rocky Ford cantaloupe comparison: both are nutritious, but the differences are wide, not narrow—much like lifelong HIV medication management in the real world. Short-term utilization metrics do not account for resistance history, hepatitis B co-infection, or clinically meaningful differences across integrase strand transfer inhibitor (INSTI) classes, including the higher resistance barriers and durability of second-generation INSTIs compared with earlier agents. Nor do they reflect the realities of aging with HIV, including low CD4 nadirs and the long-term durability of immune recovery. When treatment decisions intersect with comorbidities and acute stressors—such as COVID-19, influenza, or measles—disruptions over decades of care can compound treatment fatigue, adherence challenges, and cumulative harm in ways utilization controls are not designed to absorb.

Colorado's statutory framework already reflects this concern. Section 10-16-152 paused prior authorization and step therapy for HIV medications and required a study—explicitly including qualitative patient and provider experience—before any policy reversal. That structure recognizes that access, treatment stability, and adherence are central to cost-effective HIV care, and that utilization management assumptions should be tested rather than presumed.

Washington's experience provides a relevant real-world test of the same assumptions underlying Policy Action 6, including the expectation that utilization management can be reintroduced without destabilizing treatment or shifting costs downstream. Through a legislatively directed budget proviso, Washington required the Health Care Authority (HCA) to remove prior authorization for all FDA-approved HIV antiviral drugs under Apple Health beginning January 1, 2023, and to report annually on utilization, expenditures, and regimen switching. That proviso—adopted in SB 5092, section 118.6.a—also prompted the convening of the HIV Medication Access Workgroup (HMAW).

Through the HMAW process, stakeholders consistently documented that prior authorization, step therapy, and regimen disruption introduced administrative friction that delayed access, destabilized effective treatment, and increased churn within Medicaid HIV care. Participants emphasized that utilization management strategies intended to favor lower-cost or multi-tablet regimens did not operate in isolation, but shifted costs downstream to Ryan White providers, safety-net clinics, and public health systems tasked with mitigating treatment interruptions and re-engaging patients. In this context, "continued access" often existed on paper while continuity of care eroded in practice.

Photo Source: ADAP Advocacy | iStock Rights Purchased

As required by the proviso, HCA published its 2024 legislative report on HIV antiviral drugs, analyzing utilization, expenditures, and available health outcomes data following the removal of prior authorization. Viral load data were available for approximately 42 percent of Apple Health clients receiving HIV treatment in 2022—more than 3,000 individuals—representing a substantial real-world Medicaid population. While HCA appropriately cautioned that this subset cannot be assumed to represent all clients, it did not characterize the data as unreliable or dismiss observed differences across regimen types.

Within this cohort, patients initiating treatment on single-tablet regimens demonstrated higher rates of viral suppression than those starting on multi-tablet regimens or switching regimens. Although insufficient to establish causality, these findings establish directionality and challenge the assumption that regimen form and administrative disruption are clinically neutral—particularly in Medicaid settings shaped by utilization management, coverage churn, and administrative delay.

Preventing a single HIV infection avoids hundreds of thousands of dollars in lifetime medical costs, with some estimates exceeding one million dollars depending on treatment scenarios. Given these well-established costs, policy decisions that risk even modest reductions in adherence or viral suppression should not be evaluated solely on short-term pharmacy spending or rebate leverage.

Notably, Washington ultimately codified the policy direction reflected in the proviso and stakeholder findings. In 2025, the Legislature enacted SB 5577, requiring Medicaid coverage of all FDA-approved HIV antiviral drugs without prior authorization or step therapy for both fee-for-service and managed care enrollees, effective July 1, 2025. This statutory action reflects a legislative determination that, for HIV treatment, utilization management introduces unacceptable risk to treatment stability and system sustainability.

The lack of complete outcomes data argues for caution, not for reinstating prior authorization and step therapy based on projected savings alone. Policy Action 6 assumes these controls can be reintroduced for HIV drugs without disrupting care or shifting costs outside the pharmacy benefit—an assumption that has not been supported by real-world experience. That assumption is not only incorrect, but—I feel—potentially harmful for Persons living with HIV in Colorado.

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

References:

[1] Martin, K. (2025, August 06). The 340B Drug Pricing Program: How It Works and Why It’s Controversial. Commonwealth Fund. https://doi.org/10.26099/210h-wv98

[2] Rojas, Dutch. (2025, January 29). The Charity That Pays Like Wall Street. The Rojas Report. https://dutchrojas.substack.com/p/the-charity-that-pays-like-wall-street?utm_campaign=email-post&r=3z1yhv&utm_source=substack&utm_medium=email

Are 340B Covered Entities Sacrificing Affordable Care for Executive Compensation?

By: Brandon M. Macsata, CEO, ADAP Advocacy, Guy Anthony, Chair, ADAP Advocacy 340B Patient Advisory Committee, and Marcus J. Hopkins, Health Policy Lead Consultant, ADAP Advocacy

The 340B Drug Pricing Program was founded on a straightforward accountability agreement: in return for significant discounts on outpatient medications, safety-net providers would “stretch scarce federal resources” to make healthcare more accessible and affordable for those most in need. However, as eligibility for the 340B Program has broadened and revenues have soared, a pressing concern has emerged: are some covered entities diverting a patient-focused initiative to fund executive compensation (CEO compensation at hospitals increased by an average of 197.2%, while compensation for CEOs at organizations that provide care for patients living with HIV/AIDS increased by 219.9%) rather than reducing costs, expanding services, and supporting vulnerable communities?

The long and short of it is YES.

Since 2023, ADAP Advocacy, in collaboration with the Appalachian Learning Initiative (APPLI) and the Community Access National Network, has audited Form 990 federal filings with the Internal Revenue Service, which have uncovered troubling trends. It involved a multi-year audit of 170 organizations eligible to participate in the 340B Program as “covered entities”—non-profit healthcare providers of various types who qualify to purchase certain outpatient prescription drugs at significantly lower prices, sell them to lower-income and poor patients, and receive rebates from pharmaceutical companies for the difference between the list price of those drugs and the purchase price (Figure 1). 

The program’s financial gains are increasingly benefiting executive leadership rather than bedside care. We believe that a program designed to stretch scarce resources shouldn’t be stretching paychecks faster than it stretches care.

What we’ve discovered has been astonishing.

Across 170 covered entities audited (all averages exclude outliers):

• Annual revenues after the first year of eligibility increased from the year prior to receiving eligibility by an average of 12.2%, while annual CEO compensation increased by an average of 28.9%.
• From the year prior to eligibility to the most recent 990s on file, annual revenues increased by an average of 609.5%, while annual CEO compensation increased by an average of 221.3%.
• CEO compensation at hospitals increased by an average of 197.2%, while compensation for CEOs at organizations that provide care for patients living with HIV/AIDS increased by 219.9%. Similarly, at other types of organizations, including (but not limited to) Federally Qualified Health Centers, Consolidated Health Centers, and STD clinics, CEO compensation increased by an average of 230.4%.

All data from ADAP Advocacy’s findings are available online at https://340bmap.org.

Figure 1 – The Complex Ecosystem of 340B Drug Pricing

Photo Source: Martin, 2025

What differentiates HIV care providers who run AIDS Drug Assistance Programs (ADAPs) under the Ryan White HIV/AIDS Program is that ADAP providers are required to report detailed records about the amounts of 340B revenue they receive and how those revenues are used. Many of these ADAPs also operate under a rebate model rather than the upfront payments used by nearly all other covered entities participating in the program. They’ve successfully used these rebates to expand access to care and treatment, while remaining accountable. 

Essentially, they’re required to show their work.

Hospitals, however, are not required to provide any public-facing information about their 340B drug sales, revenues, or how those revenues are used, which has repeatedly led to those revenues—statutorily required to be used to improve the access and affordability of healthcare services for poor patients—being misappropriated for other purposes, including the opening or acquisition of new facilities (known as “child sites”) in affluent neighborhoods where profits will be higher, unnecessary, decorative construction inside hospitals, to increase CEO and other executives’ salaries, and other purposes.

In fact, 10 of the 104 hospitals we audited saw CEO compensation increase by 500% or more from the year prior to their eligibility for the 340B program to their most recent filings, with one hospital increasing its CEO compensation by 2,803.8% in just 16 years.

It is symbolic of a larger trend within the hospital ecosystem, as eloquently noted by Dutch Rojas in a recent Substack post in The Rojas Report: The Charity That Pays Like Wall Street. Supplemental Executive Retirement Plans, or SERPs, are "how nonprofit hospitals pay their executives more than Wall Street pays its bankers" (Rojas, 2025).

Meanwhile, the United States faces a critical national nursing shortage that will leave American citizens at significant risk. This shortage will increase as a result of recent moves by the Trump Administration to declassify nursing as a “professional” degree, thus making it more difficult for aspiring nurses to receive student loans. And all of this while CEOs—who virtually never engage with actual patients or provide any sort of healthcare service—are able to demand salaries so high that most Americans cannot conceive of the number, and nobody blinks an eye.

We argue that 340B dollars, regardless of the covered entity eligible to receive them, should be directly tied to improving patient access and affordability. One way to improve services, for example, would be to use those funds to hire more nurses. Or increase the pay of the existing nurses. Alternatively, keep rural hospitals open rather than closing and consolidating them.

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

References:

[1] Martin, K. (2025, August 06). The 340B Drug Pricing Program: How It Works and Why It’s Controversial. Commonwealth Fund. https://doi.org/10.26099/210h-wv98

[2] Rojas, Dutch. (2025, January 29). The Charity That Pays Like Wall Street. The Rojas Report. https://dutchrojas.substack.com/p/the-charity-that-pays-like-wall-street?utm_campaign=email-post&r=3z1yhv&utm_source=substack&utm_medium=email