Gifford Medical Center is now participating in a federal drug pricing program called 340B.
Administered by the Health Resources and Services Administration’s Office of Pharmacy Affairs, the program has been around since 1992, but expanded last year to Critical Access Hospitals like Gifford as part of the Affordable Care Act.
The program allows Gifford to generate some revenue and cut some costs, which allows the hospital to reduce inflation for future patient rates. It works when Gifford patients fill their non-generic, non-narcotic prescriptions at pharmacies also participating in the program.
So far, Kinney Drugs in Randolph is participating and hospital officials are hoping that other Kinney locations, Northfield Pharmacy and Rite Aid will also soon join in.
The program has no effect on patient and customers’ costs, but does help Gifford at a critical time.
‘During the current economy, it’s essential that hospitals think creatively and find new ways to fund necessary services for our community,’ David Sanville, Gifford vice president of finance, said. ‘Participation in this federal program is an opportunity to expand revenue and cut costs without raising what we as a medical center or pharmacies charge patients. It’s a win-win for everyone, including the consumer who gets to support its local hospital without paying more.’
Hospitals are facing unprecedented costs challenges that have resulted in layoffs at a number of facilities.
Gifford continuously strives to address financial pressures without layoffs or major rate hikes to patients. In fact, Gifford’s rate increases are typically at or below average. The 340B initiative, which began in July, is one avenue of cutting costs without negatively affecting patient care.
‘In fact, every time a Gifford patient fills a non-narcotic name brand drug at Kinney in Randolph, they’re financially supporting the hospital and helping keep care local and accessible,’ says Sanville.
Originally designed to cut expenses at government hospitals and health care entities, the program allows Gifford to partner with pharmacies like Kinney and others. That partnership through 340B allows Kinney to purchase pharmaceuticals for Gifford patients (meaning prescribed by a Gifford health care provider) at a reduced price. That savings is then shared with the hospital with the goal being that ‘safety-net health care providers’ like Gifford are helped.
Generic medications are excluded because they are already lower in price. ‘Orphan’ drugs are also excluded. These are pharmaceutical agents developed specifically to treat a rare medical condition, or orphan disease.
‘Anyone filling their name brand blood pressure and cholesterol medications, their birth control, anti-depressant, insulin or any of the many medications so many now take can actually be helping Gifford,’ says Sanville. ‘Very little in life is ‘free,’ but this is one way to help keep needed services local without spending extra.’
Source: Gifford Medical Center