Article
What the draft proposes
The draft, released June 25, is the most sweeping 340B overhaul Congress has seen in years. The program reached a record $81 billion in drug purchases in 2024, and lawmakers have not made major changes to it in roughly 15 years. Key provisions would:
- Tighten the definition of a 340B patient.
- Require hospitals to publicly report margins generated from 340B drugs.
- Cap out-of-pocket costs for low-income and insured patients through mandatory sliding fee scales.
- Limit 340B use at off-site outpatient facilities unless they meet new tests, such as location in a shortage area and minimum charity care levels.
- Authorize a rebate model, according to 340B Health, in place of upfront discounts.
Stakeholder feedback is due Aug. 28. It is a discussion draft, not an introduced bill, so the text will change.
How hospital groups responded
340B Health, which represents more than 1,600 participating hospitals, said the combined restrictions would leave hospitals with far fewer chances to capture savings, especially safety-net providers, and plans to submit formal comments. America’s Essential Hospitals welcomed Cassidy’s engagement but warned against burdensome requirements and argued that manufacturers have repeatedly tried to weaken the program.
The draft lands as pressure mounts from drugmakers. Eli Lilly began denying 340B pricing on June 18 to hospitals that did not comply with its claims data policy, and major hospital groups have asked federal officials to intervene.
What finance leaders should model
- Site-level exposure. Estimate 340B savings at each off-campus location and test them against the shortage-area and charity care criteria.
- Patient definition scenarios. Model how stricter eligibility would affect referral and contract pharmacy volume.
- Rebate cash flow. A shift from upfront discounts to rebates would tie up working capital. Quantify days of delay and administrative cost.
- Margin reporting readiness. Decide how you would calculate and explain 340B margins, and what the numbers say about community benefit.
Hospitals that can show clearly how savings fund patient care will be better positioned in comments and in later negotiations.
Archive entry for Jun 27, 2026, added Nov. 11, 2026.