Anthony DiGiorgio, an Assistant Professor of Neurological Surgery at the University of California, San Francisco Medical Center, said that the 340B drug pricing program has moved beyond its original purpose as a safety-net tool, raising concerns about oversight and its impact on patient care.
The 340B program was designed to help safety-net providers purchase outpatient drugs at discounted prices and expand services for vulnerable populations.
Critics argue that some of the revenue generated through the program may not be reaching the patients it was intended to benefit.
“Only a few certainties in life: death, taxes, 340B is a scam, and Woodrow Wilson is the worst president of all time,” DiGiorgio said in a social media post.
Data from California illustrates the scale and structure of the program’s expansion.
State profile data show there are 27,952 arrangements between 340B covered entities and for-profit contract pharmacies in California, including nearly 7,000 involving pharmacies located outside the state. Only 8.6% of in-state contract pharmacy locations are in rural areas, despite rural ZIP codes accounting for 22% of the state. About 15% are located in ZIP codes with average household incomes below the state median.
The program’s structure has also been linked to broader economic impacts.
Estimates indicate that California employers pay approximately $586 million more annually in health care costs due to foregone rebates associated with the program. In addition, state and local governments see an estimated $76.6 million reduction in tax revenue tied to these arrangements.
National trends show similar patterns.
From 2011 to 2019, participation by contract pharmacies in the 340B program increased significantly, but growth did not correspond with greater presence in socioeconomically disadvantaged communities. Fewer participating retail pharmacies were located in lower-income areas or neighborhoods with higher proportions of non-Hispanic Black and Hispanic or Latino residents during that period, according to research published in JAMA Health Forum.
DiGiorgio is an Assistant Professor at UCSF specializing in neurological surgery with clinical work focused on traumatic brain injury and spinal cord injury. His background includes both medical (DO) and health administration (MHA) degrees. UCSF Health-UCSF Medical Center itself was founded in San Francisco in 1907; its current president is Suresh Gunasekaran. The hospital admitted approximately 41,000 patients for treatment during calendar year 2022.
