September 11, 2025 (AUSTIN, Texas) –– In comments submitted to the Health Resources and Services Administration on its proposed 340B prescription drug pricing change, Teaching Hospitals of Texas describes the proposal as a “pay and chase” model that unnecessarily disrupts long-standing practices in the program and is contrary to the Trump Administration’s goals of reducing regulatory and bureaucratic inefficiencies and making prescription drugs less expensive.
“Congressional intent for the more than 30-year-old 340B prescription drug program is unambiguous as is the Administration’s vision for reducing administrative burden and inefficiencies in health care,” said Maureen Milligan, PhD, CEO, Teaching Hospitals of Texas. “HRSA’s proposal to convert the current up-front discount practice to a post-purchase rebate model flies in the face of Congressional intent for the program, which is to stretch scarce federal resources, and to the Administration’s goal of increasing health care efficiency.”
THOT’s submitted comments highlight numerous concerns with the proposed rebate model, including:
- Shifting funding and the balance of power to drug manufacturers and putting hospitals in the unprecedented position of providing drug companies with interest-free loans.
- Unfairly requiring hospital participation but allowing drug manufacturers the option to voluntarily participate.
- Creating new administrative burdens and costs of participation and compliance for hospitals.
- Adding administrative burden and costs to state Medicaid programs.
- Missing clear, measurable metrics for program success and evaluation parameters.
“HRSA can still heed the warnings from the health care provider community and withdraw the proposal that offers a handout to multi-national pharmaceutical companies, at the expense of local community-based care,” added Milligan. “The 340B prescription drug program’s savings are indispensable for our safety net hospitals to continue providing care from the highest level of trauma care to preventive services at community clinics to residents from every county in Texas.”
The comments can be read here.
