The Health Resources and Services Administration (HRSA) issued guidance July 31 on a proposal to shift a portion of the 340B drug pricing program away from an upfront discount model to a rebate model. HRSA guidance indicates permission for certain drugmakers to participate in a rebate model for certain drugs starting January 1, 2026 and allowing the rebate pilot to run for at least one year.
The specific drugs selected for the pilot include those subject to negotiation under the Medicare Drug Price Negotiation for initial price applicability year 2026. The guidance issued outlines pilot program criteria including requirements that any plan submitted by a manufacturer include a platform for data submission paid for by drug manufacturers, and a specific prohibition on passing that cost on to covered entities; requiring 60 days notice to covered entities before implementation of a rebate model; allowance for covered entities to purchase pilot covered drugs through existing distribution mechanisms; requirements for technical assistance and good faith engagements and requirements on data security. Importantly, HRSA reiterates the requirement that manufacturers may not implement rebate plans without prior approval.
From a reporting perspective, the guidance indicates that any plan submitted limit data submission requirements from covered entities to several readily available fields and allows covered entities to submit and report data for up to 45 calendar days from date of dispense or potentially longer if extenuating circumstances arise. Finally, the guidance requires that manufacturers pay rebates, or alternatively deny them with documentation, within 10 calendar days of data submission.
The MHA remains concerned about the implications of significantly altering the foundation of the 340B program. Given the program’s intent to stretch scarce federal resources for safety net healthcare providers, the proposed pilot does not appear to align with Congressional intent at this time.
The MHA continues to review this guidance and encourages members to submit comments through the Federal eRulemaking Portal.
Also on July 31, President Trump sent letters to drug manufacturers reiterating his expectations that American families and patients see the impact of Most-Favored-Nation prescription drug pricing. In the letter, the President emphasized that within 60 days, manufacturers doing business in the United States should take several actions:
- Extend Most-Favored-Nation pricing to Medicaid.
- Guarantee Most-Favored-Nation pricing for newly launched drugs.
- Return increased revenues abroad to American patients and taxpayers.
- Provide for direct purchasing at most-favored-nation pricing.
As major purchasers and consumers of prescription drugs, hospitals and patients continue to seek relief from rising costs. The MHA will continue to monitor the president’s prioritization of lowering drug prices and its potential impact on healthcare affordability and access.
Members with additional questions should contact Elizabeth Kutter at the MHA.
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