New PhRMA Report Details Role of Hospitals in High Drug Costs

A recent PhRMA discusses how hospitals contribute to the high prices of drugs in the United States. Typically, pharmaceutical companies, insurance companies, and patients are discussed in the context of high prices, not hospitals. However, depending on whether or not patients receive medication from a 340B-designated hospital, the drug price might be significantly different. The 340B Drug Discount Program was begun in 1992 to allow vulnerable patients to access medications. The number of participating hospitals has steadily risen. The report suggests further examination and perhaps reform of the 340B program in combatting high drug prices.

The authors note, “The shift in the delivery of provider-administered medicines to more expensive hospital outpatient settings and the significant revenue streams tied to hospital markups on medicines suggest that financial incentives in the current system may not be appropriately aligned to produce the lowest costs for patients, employers, or the health care system.” Read more here.

(Source: PhRMA, 2/2021)