U.S. Senate HELP Committee unveils 340B reform draft for drug pricing oversight

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340B program reform draft

Highlights

Cassidy unveiled the 340B Drug Pricing Integrity and Affordability for Patients Act draft targeting waste, abuse, transparency, and patient benefits, with comment submission due by August 28, 2026.
The 340B program expanded to $81 billion in drug purchases in 2024, raising concerns over whether discounts benefit low-income and uninsured patients as intended.
Congress has not reformed 340B since Obamacare despite rising disputes and recent investigations into hundreds of millions in fee revenue generated via the Prime Vendor Program.

Draft proposal targets oversight and patient benefits

As reported by the Senate Committee on Health, Education, Labor, and Pensions, Cassidy released the 340B Drug Pricing Integrity and Affordability for Patients Act discussion draft as part of his broader review of how the federal program operates.

The proposal is designed to curb waste, fraud and abuse, ensure benefits reach low-income and uninsured patients, provide clearer regulatory rules and put the program on what Cassidy describes as a more sustainable path to lower healthcare costs. Cassidy says transparency and oversight gaps are preventing the program from delivering better access and lower costs for patients.

He is asking hospitals, health centers, pharmacies, manufacturers and other stakeholders to submit comments on the draft by August 28, 2026. The measure builds on his earlier committee hearing, a report on how covered entities use and generate 340B revenue, and an ongoing investigation into the 340B Prime Vendor Program.

Program scale raises wider cost and policy questions

Congress created the 340B program to help low-income and uninsured patients by allowing eligible hospitals and community health centers to buy certain prescription drugs at steep discounts. Covered entities may then charge full price to a patient or insurer, using the margin to support operations, a structure that has drawn increasing scrutiny as the program expands.

Since Obamacare broadened eligibility, the program has grown sharply, reaching $81 billion in drug purchases in 2024, according to the committee text. Cassidy's office says concerns have increased over whether the program is translating into more care or lower costs for vulnerable patients, while the Congressional Budget Office has cited misaligned incentives that raise medication and insurance costs for taxpayers.

The political and industry significance is likely to be broad because Congress has not reformed the program in the 15 years since Obamacare, even as disputes have intensified among hospitals, pharmacies, drugmakers and policymakers over how 340B revenue is used. Cassidy's investigation also examines the prime vendor system after it generated hundreds of millions of dollars in fee revenue tied to drugs sold through the program.

Our earlier report on the court order blocking new federal student-loan borrowing limits for some healthcare graduate programs explained how the injunction keeps higher $200,000 lifetime caps available for advanced nursing and related fields while lawsuits proceed. We also noted that lawmakers were weighing policy responses amid concerns the rule could worsen healthcare workforce shortages by making training more expensive and uncertain.

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