Cookeville Regional reinvesting some $16.9 million in annual savings from a federal drug pricing program to maintain critical healthcare services.
CEO Buffy Key said the 340B program requires drug manufacturers to provide discounted pricing to eligible public hospitals that serve uninsured and low-income populations. Key said the medical center provides approximately $34 million in uncompensated care every year and relies on these savings to offset those costs.
“We don’t just when they come up to the window and they want to refill insulin or whatever the case and it’s an astronomical amount,” Key said, “We take that a step further and our team actually works with them to get either no cost or as low a cost as possible.”
Key recently shared the UC story with the American Hospital Association and how losing the 340B Drug Pricing Program could be devastating to rural communities.
Key said the hospital saved approximately $2 million in direct drug costs last year. Key said the program is essential for sustaining expensive service lines such as labor and delivery, which saw a record 2,050 births at the facility last year.
“Another thing in looking at our Cancer Center, we would be completely unable to provide the high level of care in our Cancer Center with our infusions and drug therapies if we did not have these monies to help us purchase those drugs for our patients,” Key said.
Key said the savings also support patients with chronic conditions like diabetes who might otherwise ration life-saving insulin due to high costs. Key said the medical center has hired a pharmacist and six prior-authorization technicians specifically to help patients navigate insurance, manufacturer assistance programs, and grant applications.
“The savings that we would normally have to spend that extra $16.9 million, we’re able to reinvest and remove other financial barriers for patients that otherwise would be delayed in their care or from accessing treatment,” Key said.
Key said the medical center serves a 14-county region encompassing some 355,000 people who often cannot travel outside the area for specialized treatment. Key said while there have been national questions regarding how some hospitals use the program, the mission in Cookeville remains focused on patient access rather than generating revenue.
“We are exactly the reason that we get that discount,” Key said. “We are exactly why this program exists and why Congress set this up in 1992.”
Key said any significant legislative changes or the elimination of the 340B program would be devastating for the hospital, which currently operates on a margin of less than five percent. Key said the facility continues to communicate with Congress to emphasize that the program is being used exactly as it was originally intended.
“We are the reason you started this program in 1992 and we are exactly who you designed it for and please, please help us take care of our patients,” Key said.