Discriminatory Reimbursement Practices by PBMs Represent a Threat to Public Health: A Perspective from Community Health

Today’s guest post comes from Shannon Stephenson, CEO of Cempa Community Care.

I am publishing this opinion piece to share a perspective from a community health provider that is eligible for the 340B Drug Pricing Program as a Ryan White clinic and as a Federally Qualified Health Center Look-Alike. As I noted last week in my September news roundup, I generally consider federal grantees to be the good guys of 340B.

Shannon outlines her view that pharmacy benefit managers (PBMs) have reduced reimbursement to her facilities. This reduces the value of the 340B program to Cempa. It also transfers funds to PBMs and their plan sponsor clients.

Read on for Shannon’s insights on this highly controversial issue.

Discriminatory Reimbursement Practices by PBMs Represent a Threat to Public Health: A Perspective from Community Health
By Shannon Stephenson, CEO, Cempa Community Care

Manufacturers and covered entities in the federal 340B Drug Pricing Program have had our “issues” over the past several years. Grantees like my organization have been in a pitched battle about the size, scope, and the purpose of 340B for nearly a decade. There is one 340B issue, however, where we should be standing solidly together.

I am the chief executive officer of Cempa Community Care, a community health provider in Chattanooga, Tennessee, that is eligible for the 340B program as a Ryan White clinic and this year as a Federally Qualified Health Center Look-Alike. I also serve as president of Ryan White Clinics for 340B Access (RWC-340B).

When the 340B program was implemented 24 years ago, its goal was to enable community health providers to more easily deliver care to vulnerable populations. Any savings were intended to be used for the purpose of “reaching more eligible patients and providing more comprehensive services,” as stated in the law’s report language. Safety net providers were specifically designated as “eligible entities” through an act of Congress. This allowed designated provider types to access 340B savings.

Cempa works to improve health outcomes for our region’s most vulnerable populations, and we do that with great success. As a licensed certified public accountant, I’ll provide some statistics that back this claim.

• Cempa’s viral load suppression rate is 92.5%, 36.5% higher than the CDC’s most recently reported national average of 56%. (When a patient is virally suppressed, this means he or she cannot transmit the virus to others.)
• Our team has reduced the timeline from new HIV diagnosis to first prescribing practitioner visit from four weeks to same-day service.
• Over the past 5 years, we have also increased HIV, Hepatitis C, and STI testing by 43%.

Our organization uses 340B to reach more patients and provide more services in our community. However, our ability to continue delivering the services our community needs is being impeded by discriminatory reimbursement practices by these PBMs.

In recent years, pharmacy benefit managers (PBMs) have reduced reimbursement rates 340B safety net providers’ pharmacies. In some cases, PBMs have gone further and excluded 340B covered entities’ pharmacies from pharmacy networks.

I have fought—and will continue to fight—on the national level and in my state legislature to prohibit these unfair contracting practices. In testimony before the Tennessee General Assembly Life & Health Insurance Subcommittee, I explained how the 340B program allows us to provide HIV care and support, infectious disease care, support services, and harm reduction programs including our Syringe Trade and Education Program of Tennessee (STEP TN) initiative because of 340B savings. I detailed exactly the kinds of PBM practices that would destroy that success. In short, I made it clear that savings originally intended to increase access to care and minimize the need for taxpayer dollars are now funneling into the bank accounts of corporate PBMs.

In the midst of our public health crisis, clinics like mine and hundreds across the country are challenged like no other time in our history. We are fighting two deadly epidemics—HIV/AIDS and COVID-19. Without the 340B program, our clinic and others would not be here to do what needs to be done—protect our communities.

Manufacturers and covered entities should agree that the savings from the 340B program were never intended to benefit for-profit, third-party benefit managers. I challenge manufacturers to work with us to advance state and federal legislation to prohibit PBMs from using these discriminatory reimbursement practices that threaten the public health and safety of all of our communities. Despite our differences, we can work together to prevent this blatant and dangerous abuse of the 340B program.

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