At a baseball game, grabbing a ball hit into the stands from a kid breaks an unwritten rule – and rightly earns boos. We all agree it’s unfair for adults to use their size and strength to snatch a souvenir away from a child.
Yet, this kind of behavior isn’t just bad sportsmanship – we see it all the time, even in health care.
Pharmacy Benefit Managers are doing something eerily similar: taking manufacturer discounts on prescription medications – savings intended for patients – and keeping the money for themselves.
The federal 340B Drug Pricing Program requires drug manufacturers to provide certain prescriptions to eligible health care organizations and covered entities at reduced prices in order to “stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.”
In other words, these discounts are for the benefit of patients. The 340B Drug Pricing Program was established under the Veterans Health Care Act of 1992 and is managed by the Health Resources and Services Administration. It was designed to provide discounted medications to eligible health care organizations, with HIV care being a primary focus.
But now, Pharmacy Benefit Managers, the middlemen between drug manufacturers and pharmacies, along with “covered entities” such as rural hospitals, have found a way to keep these discounts for themselves.
Here’s how the scheme works:
Let’s say the 340B program provides a $50 manufacturer discount on a $100 drug. Instead of passing that $50 savings to the patient, PBMs and certain hospital systems pocket the full $100 reimbursement from insurers, keeping the difference as profit.
In fact, this scheme has become a way for health care facilities to realize massive profits all at patient expense. The result is that a program intended to help low-income patients get access to life-saving medicine has now become a vehicle for PBMs and hospitals to make money.
This exploitation of 340B has turned a patient-centered program into a cash cow for corporate interests, diverting critical funding away from those who need it most. Worse yet, now that PBMs and hospital systems see how profitable 340B can be, they want more.
HIV programs have relied on 340B savings since the beginning. The Ryan White HIV/AIDS Program is one of the largest participants, ensuring that HIV service organizations can expand access to HIV medications, provide wraparound services, and help uninsured and underinsured patients stay in care.
For people aging with HIV, protecting 340B is even more urgent. Today, over 50% of people living with HIV in the U.S. are older than 50, and many face comorbidities like heart disease, diabetes, and cognitive decline, making uninterrupted access to health care essential.
If PBMs and hospital systems continue hoarding 340B savings, the very programs that support older adults with HIV will be undermined or forced to scale back services. That means more treatment disruptions, fewer support programs and higher out-of-pocket costs – all because of corporate greed.
This is a crisis that cannot be ignored. If state legislators fail to step in, HIV service providers could lose critical funding, and patients, especially older adults, will be left behind. Illinois must take a stand and stop PBMs from exploiting 340B at the expense of people’s health.
The choice is clear: Either lawmakers protect patients, or they protect corporate profiteers. Without urgent action, more people will struggle to afford life-saving medication. The 340B program was created to save lives, not pad corporate bottom lines. It’s time for Illinois to do the right thing and ensure that 340B serves its original purpose – helping those who need it most.
• Jax Kelly is founder, president and CEO of the Aging and HIV Institute in Palm Springs, California.