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  • Writer's pictureJoshua Free

I love a good Jump to Conclusions Mat

The Nelco blog has a troubling lack of references from Office Space, so just gonna set that right there...

Sometimes I think researchers are literally handed one of these by the people funding the study. If you haven't seen Office Space, I'm talking about this mat with various conclusions you can "jump" to, and...OK nevermind. No joke ever got better by someone explaining it. Anyways...

This dubious study has been making the rounds lately. Promoted by one well know PhRMA paid pundit as proof of 340B corruption, but it's not that at all. Check it out here:

I'm no statistician, but by quick glance at the confidence intervals it looks like the study shows no statistically significant difference in care of men with advanced prostate cancer between 340B and non-340B hospitals. This is further broken out by social vulnerability. Then the authors leap to a nonsense conclusion that the "problem" is solved if 340B hospitals discount drug costs to patients.

Here's their conclusion:

"Despite the 340B program’s intent to bolster the safety net of participating hospitals, it did not affect the care of men with advanced prostate cancer. In light of growing calls from policymakers to reform the 340B program, due to concerns regarding its effectiveness, focus could first shift towards providing hospitals with guidance on how to effectively use savings to benefit those most in need. One practical option would be for hospitals to use 340B savings to provide drug discounts to those who are most susceptible to high drug costs (i.e., socially vulnerable men who do not qualify for payment assistance programs)."

So lets think this through. First, the claim that 340B did not impact men with advanced prostate cancer is short sighted. 340B isn't supposed to create some kind of magical clinical advantage. I wouldn't expect a 340B hospital to somehow have better outcomes. I expect that without 340B there may be no urology or oncology program at that hospital at all. Or no hospital, period. Then how would those men have fared?

Next, their solution of using savings to provide drug discounts is a reach. By their own study, we don't know that out of pocket cost is the problem. We don't know who dispensed the prescription, or if it was even a 340B eligible encounter. There is not nearly enough information to draw this conclusion. Contrary to the industry pinheads who keep claiming otherwise, 340B hospitals ARE providing discounts and charity care, most up to 400% of FPL. A lot of non-340B hospitals do that too--by in the case of DSH, SCH, and RRC hospitals, they by definition have more of those patients. So 340B covered entities are doing this for more people, who make up a greater proportion of their market. Hardly damning evidence.

Where it gets sticky is when hospitals try to provide targeted discounts. Stark Law has strict limits on what you can do. Discounting drug copays, particularly if you didn't even dispense them, is sometimes simply not allowed or has the appearance of inducement that puts the hospital at huge financial risk. Hardly as simple as the critics make it seem. But keep in mind, this patient assistance is in addition to the charity care the hospital is providing by default when taking payments from CMS, which reimburses below cost.

340B wasn't designed as a direct patient benefit, by the plain language of the statute. Don't believe me? Check out the statements from the district court of South Carolina in the Genesis case here:

These 340B hit pieces are going to keep coming. Unsurprisingly, the rebuttal always looks familiar. But this one is special as the researcher's own data shows 340B hospitals are providing statistically the same care under what is by definition a more vulnerable patient mix. Nice try, but maybe next time look for research that actually supports the conclusion being drawn.

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