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

Sen. Cassidy Shines Spotlight on 340B Program, Furthering Calls for Reform

By: Ranier Simons, ADAP Blog Guest Contributor, and Marcus J. Hopkins, ADAP 340B Consultant

So far in 2025, state legislatures nationwide witnessed a flurry of legislation on the 340B Drug Pricing Program. Just over one hundred 340B-related bills were introduced in this legislative session (Ingmire, 2025). A handful can be characterized as genuine reform efforts. Still, most are “gimmes” to the powerful hospital lobby, designed to expand the program without any guardrails or guarantees that patients will benefit. Billions of dollars and ultimately patients’ welfare are at stake, which is why Senator Bill Cassidy recently released a report on the 340B Program. The report, focused on stronger accountability and transparency, culminates a year-long inquiry by the powerful Senate Health, Education, Labor, and Pensions (HELP) Committee. The report echoes the growing chorus calling for long-overdue reforms.

Sen. Bill Cassidy | Photo Source: End Points News

Aside from special interests representing the reform denialists, reactions to the report’s findings have been cheered and represent momentum toward something finally being done to return the program to its legislative intent. Senator Cassidy states, “This investigation underscores that there are transparency and oversight concerns that prevent 340B discounts from translating to better access or lower costs for patients. Congress needs to act to bring much-needed reform to the 340B Program” (HELP, 2025).

The 30-year-old 340B program has ballooned more than 600% since 2000, with over 60,000 participating covered entities (Olsen, 2025). The program was created to enable providers, known as ‘covered entities’ (CE), serving large populations of low-income individuals to purchase brand-name and generic medications at a considerable discount and use the savings to provide increased care to patients and lower their costs. Presently, the designation of CE encompasses six different categories of hospitals and ten categories of non-hospital entities (340B, n.d.). Drug manufacturers have to offer the drugs at a discount under the 340B program as a condition of participating in the Medicare Drug Rebate Program. 

As a result of the growing number of participants, many stakeholders are alarmed because the program seems not to result in increased care and lowered costs for low-income and uninsured patients as initially intended. Senator Cassidy’s investigation comprised information requests of eight of the most prominent 340B participants from several categories: two hospital-covered entities, two FQHCs, two contract pharmacies, and two drug makers (Muoio, 2025). What follows is an overview analysis of the Cassidy Report.

Photo Source: Senate HELP Committee

The investigation found that:

• Neither Bon Secours Mercy Health (Richmond Community Hospital in Richmond, VA) nor the Cleveland Clinic (Cleveland, OH)—the two hospital systems examined by Senator Cassidy’s office—pass on 340B savings directly to patients. Both hospital systems stated that the 340B legislation does not require them to do so. While both systems have sliding scale payment programs for patients based upon their annual incomes as a percentage of the Federal Poverty Level (FPL) that allow patients to pay smaller percentages of the costs of services, both systems responded that they are not required to pass “dollar-for-dollar” savings on to patients.

• Neither Bon Secours nor the Cleveland Clinic accounts for 340B revenues or savings in their operating budgets. Both reported sentiments that “340B revenues are revenues like any other” and did not feel obligated to allocate or earmark 340B revenues for specific purposes. Instead, both hospitals treat those revenues as part of general funds and that they can be used for any purpose they see fit. This sentiment aligns with sentiments expressed by other hospital systems in previous congressional hearings.

• Of the two Federally Qualified Health Centers (FQHCs) examined by Senator Cassidy’s office, both Sun River Health and Yakima Valley Farm Workers Clinic generated a majority of their 340B revenues from a single class of drugs—HIV/AIDS medications, which accounted for more than 54% of their 340B revenues at Sun Valley, and drugs to treat diabetes, which accounted for nearly 45% of 340B revenues at Yakima.

• Both FQHCs leveraged their 340B revenues to provide significant discounts on medications dispensed to patients whose incomes fell below 200% of the FPL.

• CVS Health and Walgreens, the two contract pharmacies and third-party administrations examined by Senator Cassidy’s office, initially refused to provide the documents requested by the office and only did so after extended negotiations.

• Both companies charge significant and increasing fees related to the provision of pharmacy dispensing and 340B third-party administrator (TPA) services. The covered entities that contract with them indicated that these increasing fees are straining their resources.

• The pharmaceutical companies that provide billions of dollars in discounts to covered entities under the 340B Program have significant concerns about the integrity of the program, with Eli Lilly and Amgen both arguing that the lack of transparency that currently exists with most covered entity types allows for covered entities, contract pharmacies, and third-party administrators to too easily manipulate, misuse, and abuse a program that was designed to increase access to care.

• Both Eli Lilly and Amgen reported significant increases in sales to contract pharmacies, rather than hospitals and grantees.

Photo Source: ADAP Advocacy

The Cassidy Report comes as ADAP Advocacy launched its national advocacy campaign, calling for reforms to the 340B Program. The campaign was kicked off with a new commercial that asks the question, Is the 340B Drug Pricing Program the Next 'Too Big to Fail'? The commercial will air in the greater metropolitan DC market while Congress is in session, and it provides plenty of fodder for lawmakers to appreciate the need to move on the report.

Ultimately, Senator Cassidy’s office recommended five changes to the 340B Program:

• Requiring covered entities to provide detailed annual reporting on how 340B revenue is used to ensure direct savings for patients, providing a more transparent link between program savings and patient benefit;

• Addressing potential logistical challenges caused by increased administrative complexity, leading to burdens that may impede patients from benefiting from the program;

• Investigating the types of financial benefits contract pharmacies and TPAs receive for administering the 340B Program to ensure that increasing fees do not disadvantage covered entities and patients;

• Requiring transparency and data reporting for entities supporting participants in the 340B Program (i.e., contract pharmacies and TPAs); and

• Providing clear guidelines to ensure that the manufacturer discounts actually benefit 340 B-eligible patients, including examining legislative changes to the definition of eligible patients.

Advocacy groups such as ADAP Advocacy, Community Access National Network, and The Alliance to Save America's 340B Program (ASAP 340B) are supportive. Cassidy’s report findings align with the work of ADAP Advocacy’s 340B Patient Advisory Committee over the last two years. In a press release, Brandon M. Macsata, CEO of ADAP Advocacy, summarized: “In 2019, ADAP Advocacy endorsed the Community Access National Network 340B Commission’s final report calling for long-overdue accountability and transparency standards to improve the 340B Program, among them clearly defining who are 340B patients, and how 340B covered entities should utilize their 340B savings to improve patient access to care and services. Senator Cassidy has laid a path to reform this vital program, and ADAP Advocacy looks forward to working with him on this important issue.” 

ASAP 340B issued a statement in support of Senator Cassidy’s work. In the release, Thomas Johnson, Executive Director of ASAP 340B, states, “This report details how large hospital systems, PBMs, and corporate middlemen take advantage of the program – it is clear the time for meaningful reform is now. We strongly urge Congress to enact legislation that realigns the 340B program in the interest of true safety-net providers and the patients and communities they serve.”

Conversely, and not surprisingly, there were some opposing viewpoints from hospital stakeholders. For example, 340B Health, a lobbying group representing over 1500 hospitals and health systems in the 340B program, expressed concern about the report. In a statement, 340B Health stated it had “concerns with several aspects of the report that may not fully reflect the purpose or implementation of 340B” (Muoio, 2025). Maureen Testoni, 340B Health’s president and CEO, also emphasized that the language of the 340B statute names ‘cost of operations’ reductions as one of the program's primary goals. She implied that using 340B savings to fund capital improvements and community benefits was a way to benefit low-income patients (Muoio, 2025). However, that sentiment is one of the concerns heralded by proponents in favor of 340B reform. Passing savings on to patients and improving their care is the impetus behind the 340B program. Capital improvements do not benefit patients directly, especially when improvements involve facilities that do not serve needy communities.

Photo Source: Drug Channels Institute

Leading biopharmaceutical experts, critical of the reform denialists' claims that the program isn't warped, pointed to the Cassidy Report to highlight glaring problems that only seem to be getting worse. For example, Adam J. Fein, Ph.D., with the Drug Channels Institute, published an analysis: "Follow the 340B Dollar: Senator Cassidy Exposes How CVS Health and Walgreens Profit as 340B Contract Pharmacies." Likewise, Matt Toresco pointed to the report, asking: "340B: Safety Net or Profit Engine?"

Although Senator Cassidy’s report involves a small sample of 340B entities, it is still an informed and enlightening cross-section of the 340B landscape and the needs for reform. Urging Congressional 340B reform actions can help bolster state legislative actions addressing the misuse of the program in hopes of refocusing the benefit on patients. Some covered entities effectively pass savings on to patients; however, many do not. Senator Cassidy has a long history of being active in healthcare reform, and this report is a salient foundation for continued efforts.

[1] 340B Health. (n.d.) 340B Drug Pricing Program Overview. Retrieved fromhttps://www.340bhealth.org/members/340b-program/overview/#:~:text=The%20340B%20ceiling%20price%20is,over%2Dthe%2Dcounter%20drugs.

[2] Ingmire, B, (2025, May 1). The Evolving Landscape of 340B Drug Pricing Laws. Retrieved from https://www.multistate.us/insider/2025/5/1/the-evolving-landscape-of-340b-drug-pricing-laws

[3] Muoio, D. (2025, April 24). Cassidy calls for 340B reform, increased oversight of hospitals, contract pharmacies. Retrieved from https://www.fiercehealthcare.com/regulatory/sen-cassidy-releases-340b-report-recommending-greater-transparency-oversight-hospitals    

[4] Olsen, E. (2025, April 28).Top Republican calls for 340B reform in long-awaited investigation. Retrieved from https://www.biopharmadive.com/news/bill-cassidy-help-committee-340B-reform-investigation/746405/

[5] U.S. Senate Committee on Health, Education, Labor and Pensions (HELP). (2025, April 24). Chair Cassidy Releases Report on 340B Reform, Calls for Congressional Action. Retrieved from https://www.help.senate.gov/rep/newsroom/press/chair-cassidy-releases-report-on-340b-reform-calls-for-congressional-action

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.