Steve Forbes, chairman and editor-in-chief of Forbes, said the 340B drug discount program was created to help vulnerable patients, but now benefits hospital conglomerates and pharmacy middlemen.
“The 340B program was meant to help vulnerable patients. Instead, it has become another Washington racket that enriches hospital conglomerates and pharmacy middlemen while driving up drug costs for everyone else,” Forbes said in a post on X.
The 340B program requires drug manufacturers to sell outpatient drugs at discounted prices to eligible safety-net hospitals and clinics. It was created to help providers serving low-income and uninsured patients stretch limited resources, but it does not require that discounts be passed directly to patients or that savings be used for specific services. Concerns about transparency, program growth, and the role of contract pharmacies have been raised in academic and policy analysis, including work published in JAMA Health Forum.
Oversight of the program has also been a recurring issue in federal reviews.
The U.S. Government Accountability Office (GAO) has found that audits do not fully verify whether covered entities prevent duplicate discounts, and that the audit closure process does not ensure all identified problems are corrected. The GAO has also noted limits in ensuring that only eligible hospitals participate, particularly in areas involving diversion and Medicaid rebate compliance.
At an October 2025 Senate Health, Education, Labor and Pensions Committee hearing, Chairman Bill Cassidy said the program had “ballooned with limited oversight.” He raised questions about how 340B revenue is used and whether it directly benefits low-income patients, while also pointing to concerns involving contract pharmacies, hospital consolidation, duplicate discounts, and transparency requirements.
Steve Forbes is chairman and editor-in-chief of Forbes Media, the publisher of Forbes. The company produces coverage on business, markets, policy, and entrepreneurship across print and digital platforms, giving Forbes a wide audience for commentary on tax and regulatory issues.
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