How health systems are preparing for a potential 340B overhaul

By Alexandra Murphy / July 28, 2025

As federal scrutiny and legislative proposals continue around the 340B drug pricing program, health systems are stepping up advocacy efforts and preparing for potential disruptions. 

At St. Louis-based Ascension, one of the nation’s largest Catholic health systems, Chief Pharmacy Officer Michael Wascovich, PharmD, said leaders are monitoring developments that could change the way safety-net hospitals access and use discounted drugs. 

One of the main ways they are planning, he said, is by largely focusing on education and engagement, not only with healthcare leaders but in Washington, D.C., and state capitals. 

“We are trying to stay engaged very directly with our advocacy partners in Washington, D.C., state and federal, and then we’re a big proponent of 340B Health, which is the three point of view provider association,” Dr. Wascovich said. “Then our focus will be to educate legislators and other key stakeholders on such impacts.”

Ascension has voiced concern about the potential move toward post-sale rebate structures. 

“If it raises prices for healthcare providers, including us, it’s certainly going to have a negative impact on our patients and then on the communities that we serve,” he said. “So without concluding anything, that’s our concern if that’s what is going to happen.” 

Nilesh Desai, chief pharmacy officer at Louisville, Ky.-based Baptist Health, echoed this sentiment, adding that the health system is continuing to examine potential shifts with the program. 

Savings generated through the program, he added, are essential to preserving access for patients, especially as eligibility requirements shift and fewer patients may qualify for Medicaid. 

“As Medicaid eligibility requirements change, fewer patients qualifying for the program could lead to reduced drug discounts, adding complexity,” Mr. Desai said. “Our focus is ensuring patients receive the medications they need, when they need them, while supporting our teams in delivering high-quality care.” 

A recent survey by 340B Health conducted in early 2024, including 347 member hospitals, underscores this concern, with 93% of hospitals responding that they would struggle to maintain uncompensated care if drugmakers shift to rebate-based pricing.

Respondents also warned that the change would impose an average cost burden of $72.2 million annually on disproportionate share hospitals and $1.7 million on critical access hospitals.

Preserving the program’s intent 

At Ascension, the stakes of maintaining the 340B program are tied closely with transparency and mission. For example, a key part of this has been educating lawmakers about how the program functions and how it allows providers to reinvest cost savings into care delivery, Dr. Wascovich said. 

“We’re very proud of our record of how we work to earn the 340B discount and share that with the poor and vulnerable in alignment with our mission,” he said. “We publish that very publicly on our Ascension website. If you were to google ‘Ascension 340B,’ you can see by market what we do with our dollars.” 

Dr. Wascovich also pushed against the notion that the 340B program must directly reduce a patient’s prescription bill to be effective. 

“That’s not actually in the spirit or in the original intent of the rule. It was for safety providers, which Ascension is, to allow us to steward those very finite resources and extend that care,” he said. “There are a lot of ways we do that. We do lower our drug prices. We have what we call our Ascension Prescription Assistance card. We put pharmacists and nurses and others in clinics to help people navigate a very complex system, especially when they have something difficult like a cancer diagnosis. There’s just a variety of ways that we extend that care.”