NACHC sent a letter to CMS and HRSA from President and CEO Kyu Rhee, MD, MPP, about the proposed 340B rebate model and and the recent executive order to lower drug prices. The letter underscored how essential Community Health Centers’ (CHCs) ability to continue to participate in the 340B program is to their financial viability so that they can continue serving this nation’s underserved patients.
The letter highlighted challenges for CHCs associated with the rebate model:
“As the Administration develops additional guidance on the 340B program, I want to reiterate our continued concern about the significant challenges a rebate model would impose on health center pharmacies, given the thin financial margins of health centers and the lack of sufficient capital to purchase drugs at higher prices upfront. A rebate program would be detrimental to health centers’ financial viability and limit patient access to low-cost drugs. CHCs could not sustain their 340B programs if discounts were converted to rebates, as a rebate model would: 1) Create significant cash-flow issues, as CHCs would have to purchase all drugs at full price upfront, then wait months to receive the rebate and 2) Add a large administrative burden to request and track rebate payments on each unit of drug dispensed.”
