Save New York’s Safety Net: Protect the 340B Pharmaceutical Benefit Program
What is the 340B Pharmaceutical Benefit Program? The 340B program is a federal program created by Congress in the early 1990s to improve care for marginalized populations. The program requires pharmaceutical companies to sell drugs to community health centers at a discounted rate as a condition of their participation in the Medicaid program. The remaining savings are statutorily required to be used directly by providers to serve low-income and underserved communities and provide services needed most to tackle some of the biggest public health challenges. 340B savings cover uninsured populations and fund services and programs that cannot be covered and funded by other sources such as Medicaid. The 340B Program is provided at no additional cost to taxpayers.
How much funding comes from the Pharmaceutical Benefit? 340B savings contribute over $250 million each year to support New York State safety net providers such as community health centers (CHCs), federally qualified health centers (FQHCs) and Ryan White clinics. At least $8 million annually goes to Housing Works’ health services. This funding helps serve client communities including people who are low-income, Black and Latinx, LGBTQ+, and/or living with HIV/AIDS, among others.
What programs and services are funded by the Pharmaceutical Benefit? The Benefit funds medical attention, housing, and other lifesaving essential services that would otherwise go unfunded, including free and low-cost service and medication provision, transportation, incentive programs, care coordination, nutritional services, and much more. At Housing Works, 340B savings funds our “Undetectables” HIV treatment and incentive program, which helps people living with HIV get connected and remain adherent to daily treatment medication that is critical to their health and the reduced spread of HIV. 340B savings also fund the operation of Housing Works’ COVID-19 hotels and allow us to provide pandemic management resources including PPE, COVID-19 testing and vaccination to our clients. Without the 340B Pharmaceutical Benefit, all these healthcare measures will be lost.
Why is the 340B Pharmaceutical Benefit Program in jeopardy?
In 2020, Governor Cuomo put a plan in place to ‘carve out’ 340B savings and reallocate them to the State, which would result in minimal real savings due to New York’s funding formula.The State would then have to send the federal government more than 70% of the money it derives by dismantling the safety net system, doing real harm to the vulnerable populations 340B was originally created to serve. After pushback from advocates and experts, the state postponed the implementation of the carve-out until April 2023. If the carve-out is not fully repealed, the results will do permanent damage to our community healthcare system and the New Yorkers who rely upon it.
