Pillar 03

340B Drug Pricing

The 340B program · Contract pharmacy · Medicare payment

LowFAH members are outside the 340B program. FAH backed CMS's cut to acquisition cost and opposes only the recoupment. On this pillar it sits with independent physicians.

Last verified November 6, 2026

FAH position

FAH says its taxpaying members derive no benefit from 340B discounts. It urged CMS to finalize the 340B payment cut and opposes only the recoupment that offsets the 2018 to 2022 remedy.

Where it stands

Status as of November 2026

November 4, 2026CMS's CY2027 outpatient final rule pays 340B-acquired drugs at ASP minus 28% from January 1, 2027, based on a 2026 acquisition cost survey. CMS estimates a $4.35 billion cut in Medicare drug payments in year one, redistributed to non-drug services. source
November 4, 2026The same rule raises the 340B remedy offset on non-drug services from 0.5% to 2% a year, until the $7.8 billion is recovered. CMS now expects that in CY2031. source
October 1, 2026HRSA approved ten manufacturers covering 21 drugs for round two of the 340B rebate pilot, limited to drugs on the Medicare negotiation lists. Start date January 1, 2027. source
October 9, 2026AHA, the Maine Hospital Association and four hospitals sued HHS and HRSA in Maine to stop the rebate pilot. They asked for a temporary restraining order. No ruling found as of November 6, 2026. source
February 10, 2026Round one of the pilot was enjoined in December 2025 and vacated in February 2026 after HHS stopped defending it. source
July 21, 2026The D.C. Circuit held that HRSA may require the Secretary's approval of any manufacturer rebate model. Manufacturers may not impose rebates on their own. source
July 14, 2026HRSA: covered entities bought $100 billion of drugs at 340B prices in 2025, up from $81.4 billion in 2024. source

Legislation

Bills in the 119th Congress

Bill	Title	Sponsor	Cosponsors	Status
S. 5244	SUSTAIN 340B Act (sunsets the rebate pilot; codifies contract pharmacy access)	Sen. Jerry Moran (R-KS)	5	Introduced Aug. 5, 2026; referred to HELP (2026-08-20)
H.R. 9599	SECURE 340B Act	Rep. Scott Peters (D-CA)	8	Introduced July 6, 2026; in committee (2026-10-06)
H.R. 9504	Tax Exempt Hospital Transparency Act (adds 340B, charity care and community benefit reporting to Form 990)	Rep. Gregory Murphy (R-NC)	1	Ordered reported by Ways and Means 25 to 15, July 1, 2026 (2026-10-07)
H.R. 5256	340B ACCESS Act	Rep. Buddy Carter (R-GA)	1	Introduced Sept. 10, 2025; no action (2025-09-24)

FAH on the record

Letters, comments and statements

May 21, 2025FAH's letter to the FTC and DOJ lists 340B eligibility rules among the regulations that distort hospital competition. source
September 15, 2025FAH's CY2026 outpatient comment strongly opposes the retrospective recoupment of $7.8 billion as unlawful. source
October 24, 2025FAH statement after the Senate HELP 340B hearing: its hospitals derive no benefit from 340B discounts. The program must serve the patients it was meant for. source
August 31, 2026FAH's CY2027 outpatient comment strongly supports paying 340B drugs at acquisition cost and urges CMS to finalize it. It opposes accelerating the recoupment to 3%. source

The evidence

•CMS, November 2023: a $9.0 billion lump sum to roughly 1,700 hospitals for 2018 to 2022. A $7.8 billion cut spread over later years offsets it. source
•HRSA: 2024 purchases at 340B prices were $81.4 billion. Disproportionate share hospitals accounted for $64.1 billion of that. source
•No FAH position on the HRSA rebate pilot or the contract pharmacy litigation was found. source

What it means for physicians

The 340B program is the subsidy that lets a tax-exempt system underprice a physician-owned practice on the same infusion. FAH's members do not get it, so FAH pushed CMS to cut it and won. On this one pillar the for-profit lobby and the independent physician want the same thing, for different reasons.

Sources