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LETTER: About the 340B program

By Staff | Aug 25, 2017

The North Dakota Rural Health Association has been keeping a close eye on the healthcare debate sweeping the nation. There is one important element to rural communities and rural providers that may be in jeopardy, and not many people know about it.

The 340B Drug Discount Program has been around since the 90’s and is important for rural healthcare in North Dakota and across the country. The program gives drug makers access to the federal Medicaid program and in return the pharmaceutical companies provide discount medications to rural and low income serving hospitals. It seems like a win-win, right? The drug companies get access to the millions of guaranteed patients in Medicaid, and provide a much-needed break for hospitals struggling to serve the most vulnerable patients in our state.

We’ve seen firsthand the positive impact this program has on our state. The 340B Program has been incredibly valuable in reducing drug prices, billing on a sliding scale, and routinely serving uninsured patients. One rural hospital told me, since the 340B program came into effect, positive operating margins allowed them to end the fiscal year in the black. The Affordable Care Act (ACA) extended access to 340B to Critical Access Hospitals. Prior to the ACA, these essential rural providers were excluded. This extension, along with the creation of Medicaid Expansion (for health insurance) is why the number of ND CAHs with positive margins (meaning revenue exceeds expenses) increased from 22% to 54%. 340B is a significant benefit to rural patients and hospitals.

Across the country rural hospitals are at risk for closing (80 since 2010). Over half of North Dakotans (285,000) live in a rural area. North Dakota’s rural residents already have limited treatment options. Any additional hospital closure(s) would cause further hardship. There are 36 hospitals where healthcare providers can access the 340B program for their patient’s medication. For these hospitals and their patients, it’s not a political issue. It’s a matter of life or death when residents are left with no serious medical care for miles and miles should rising drug prices keep hospital balance sheets in the red.

I am a proud North Dakotan, but I realize rural areas have issues. Rural areas tend to have an older population, higher levels of poverty, higher levels of chronic disease and higher rates of uninsured which impact access to care. North Dakota also has health workforce shortages. Our indicators for health status tend to be worse than urban areas and there is significant behavioral health (opioid abuse) issues as well. Maintaining viable rural hospitals is essential. 304B is an important program to help rural North Dakotans maintain access to high quality and essential care.

We strongly encourage Congressman Cramer to continue his support for the 340B program. Since he took office, Congressman Cramer has been working to grow North Dakota. Without the 340B program, many rural economies would suffer if North Dakota hospitals close and hospital workers are forced to leave their communities.

Ending 304B means increased profits for “Big Pharma” companies. We understand the need for pharmaceutical companies to make money, but not at the expense of patients and rural providers.

No matter how you feel about the current state of the health care debate, I hope Congress, especially rural based Congressmen like Kevin Cramer can see why the 304B program is an important, proven part of the American hospital system and should be preserved.

Gretchen Dobervich

President, North Dakota Rural Health Association

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