Established by Congress in 1992, the 340B Drug Pricing Program was intended to help safety-net providers improve access to healthcare for low-income, uninsured, and other vulnerable patients. Through the program, biopharmaceutical companies provide deep discounts on outpatient medications to 340B eligible covered entities, which include safety-net hospitals and federal grantees like Community Health Centers (CHCs), rural health clinics, and other providers treating underserved communities. Those savings are intended to be used to support these entities in providing care to patients in need.
The fundamental purpose of the 340B program – making sure vulnerable patients can obtain essential medications – is still vital. However, purpose by itself is not sufficient. More than three decades later, patients deserve clear confidence that the program is operating as intended and delivering on its promise.
Since its establishment, the 340B program has grown significantly. In 2024, 340B covered entities purchased $81.4 billion in covered outpatient drugs through the program. As of mid-2025, about 32,000 pharmacies – which represent nearly 60% of the country’s pharmacy industry – contract with hospitals and federal grantees that participate in 340B.
As the program continues to balloon in size, stakeholders are increasingly asking a critical question: Is the 340B program truly benefiting patients as Congress intended?
Growth Without Guardrails
Data make clear the 340B program has grown significantly since its inception. At the same time, transparency and oversight requirements have not grown at the same pace.
Today, complex financial arrangements – including increased use of contract pharmacies and the involvement of pharmacy benefit managers (PBMs) – play a larger role in how 340B operates. Without clear reporting requirements, there is no easy way determine whether program savings are being used to benefit patients as they were designed.
For individuals managing lifelong chronic conditions – such as cancer, HIV, autoimmune diseases, and bleeding disorders – access to medications is not optional. It is continuous and expensive for patients. When the connection between 340B savings and patient affordability is unclear, those living with chronic and other complex diseases bear the consequences.
A Patient-Focused Approach
Recent developments in Virginia highlight a constructive path forward. Rather than moving ahead to advance legislative proposals that expand the 340B program without ensuring that patients benefit, state lawmakers decided instead to conduct a study into the program’s impact in the Commonwealth. A group of stakeholders from across the healthcare system will conduct a careful evaluation of how 340B operates across Virginia, reporting back to the General Assembly with findings and policy recommendations following their analysis.
This shift in approach reflects an important principle: before expanding a program that has grown substantially over time, policymakers should have a comprehensive understanding of how 340B currently operates and if – and under what conditions – it is not delivering the intended benefits to patients.
Reform to Strengthen, Not Weaken 340B
Calling for reform and greater understanding of how 340B operates is not a call to dismantle the program. It is a call to strengthen it.
The decision by Virginia lawmakers to pause and study the impact of 340B before pushing forward with program expansion offers other states a model for responsible, patient-centered policymaking. As conversations about 340B transparency and reform continue at both the state and federal levels, the voices of patients living with chronic illness must remain at the center.
CCPA has put forth three key policy priorities to strengthen the 340B program and return it to its original intent.
- Ensure 340B discounts serve vulnerable patients: Require hospitals and pharmacies to ensure patients see benefits from 340B funds.
- Prioritize safety net providers and patient access: Ensure grantees can continue their valuable mission while incentivizing 340B entities to maintain facilities close to underserved patients.
- Improve transparency and accountability and protect the 340B program from abuse: Protect the program from abuse by entities, such as PBMs, who seem to have been unfairly profiting from the program for years. New transparency measures should prevent misuse and ensure equal accountability for all covered entities and partners in the program.
Learn more about the 340B Drug Pricing Program with the following CCPA resources:
- Blog: Understanding the 340B Drug Pricing Program and Its Impact on Patients
- Policy Priority: 340B Drug Pricing Program