Bipartisan agreement. Lower costs for patients. Saving money for taxpayers.
Although it may be hard to believe, there is one issue in Washington that meets the above criteria: fixing the 340B program.
Under 340B, eligible hospitals and clinics can purchase drugs at prices that can be as low as a penny. Tax-exempt hospitals are exploiting the program by raising drug prices by up to thousands of dollars, charging patients and their insurers the high price and pocketing the difference. The program now provides an unsupervised revenue stream of nearly $65 billion for hospitals, clinics and their for-profit partners. In fact, a recent report revealed how hospitals and clinics in Minnesota, along with their for-profit partners, generated at least $1.34 billion in 340B program earnings in 2024, and that’s just one state.
Instead of reducing costs for patients, the The 340B program has become a hospital margin program that is driving up costs for patients, taxpayers, states, and the federal government. And while the program and its flaws are complex, one problem rises to the top: There are no barriers to how much hospitals can mark up 340 billion drugs and there is no requirement that hospitals and clinics pass the savings on 340 billion drugs on to their patients.
The growing need for Washington to fix the program is something both parties and both chambers of the legislature have recognized. In October 2025, the Senate Health, Education, Labor and Pensions committee met to discuss concerns about the program’s growth and lack of benefits for patients. Members on both sides of the aisle cited a lack of oversight of the program and concerns about how hospitals can exploit the program’s profits without requirements that patients benefit.
In March, the House Energy and Commerce Committee held a hearing to examine the role providers and hospitals play in rising health care costs. At the hearing, several members of Congress expressed concerns about how the 340B program is increasing costs and needs federal reform.
Congress should build on this momentum and implement stronger, common-sense accountability measures for the program to curb hospital abuse that is driving up costs and ensure low-income patients actually benefit. In an increasingly divided Washington, lawmakers must prioritize this bipartisan issue to reduce costs for patients.
If policymakers truly want to improve the affordability of prescription drugs for patients, they must address the 340B program.
