HealthLeaders editor on 340B: ‘We continue to have serious concerns about persistent and often illegal abuse of 340B’

Luke Gale, Revenue Cycle Editor for HealthLeaders Media, reported that the American Hospital Association claims drug companies are more likely than hospitals to violate 340B Drug Pricing Program rules and urged greater government oversight. The statement was made in an analysis.

"We continue to have serious concerns about persistent and often illegal abuse of 340B, which is driving up costs for patients, employers and taxpayers," said Gale. "Greater oversight of these drug companies is necessary to ensure the continued success of the 340B program for the millions of vulnerable patients and communities nationwide who rely on it."

The 340B Drug Pricing Program was established by Congress in 1992 to mandate pharmaceutical companies to provide outpatient medications at discounted prices to eligible healthcare providers serving low-income or rural populations. The program aims to allow these facilities to stretch limited federal resources and deliver expanded services to vulnerable patients. Oversight is provided by the Health Resources and Services Administration (HRSA).

According to the U.S. Government Accountability Office, in 2022, covered entities—including hospitals, clinics, and health centers—saved an estimated $6 billion through the 340B program. These savings enable healthcare organizations to offer more comprehensive care, such as providing free or discounted medications to patients who may otherwise be unable to afford them. The savings generated are an important funding source for safety-net facilities.

A 2023 analysis by Health Affairs indicated that nearly half of hospitals participating in the 340B program serve a disproportionately high number of low-income patients. These hospitals often use 340B savings to deliver community health services, improve patient access to necessary medications, and fund specialty care for underserved populations. The analysis underscores the program’s role in supporting health equity.

Gale has been Revenue Cycle Editor at HealthLeaders Media since February 2025, reporting on financial and regulatory healthcare topics. He previously worked as a freelance copywriter and communications consultant for organizations such as Blue Cross Blue Shield of Massachusetts, MetLife, and the American Hospital Association. Gale holds a bachelor’s degree in journalism from Hampshire College.