Hospitals already have felt some of the effects of the Inflation Reduction Act on 340B savings, but with the IRA set to expand to more drugs in 2027, hospitals also are starting to project how it might affect their bottom lines next year. 340B Vice President of Pharmacy Services and Education Steven Miller joins us to explain how hospitals can be making those projections now. The IRA Will Expand to Another 15 Drugs Next year, an additional 15 drugs will be subject to Medicare price caps under Medicare Part D on top of the 10 drugs that saw caps this year. Steve says this will cut into 340B savings and overall margins even more — with some 340B discounts possibly dropping to their statutory minimums. These reductions also will translate to commercial and cash-pay dispenses, changing the overall financial outlook for hospitals. Hospitals Cannot Rely on Current 340B Savings Levels for 2027 Steve says the 2027 changes are key for future budgeting. If hospitals do not adjust how they are budgeting for 340B drugs subject to Medicare price caps, they are likely to be short on their budget projections. He strongly recommends 340B teams have important conversations with finance teams now about how the IRA will affect their hospital or health system next year. Hospitals Can Be Planning Now For the rest of 2026, Steve recommends hospitals monitor list pricing and 340B ceiling pricing regularly and to increase monitoring of purchases overall, given how drugmaker pricing behavior affects future 340B prices and savings. As the IRA continues to broaden over the next several years, including to Medicare Part B dispenses, he also recommends hospitals consider securing funding or support from other areas for any 340B-funded services that might see negative IRA impacts. Resources: Prepare Your Leadership for 340B Changes From 2027 Medicare Drug Price Caps

How To Calculate How the IRA Will Affect 340B in 2027

340B Insight

# Full Transcript

**Podcast:** 340B Insight

## Participants

- **David Glendening** (340B Health)
- **Stephen Miller** (340B Health)
- **Stephen Miller** (340B Health)

## Transcript

Welcome to 340B Insight from 340B Health. Hello from Washington, D.C. and welcome back to 340B Insight, the premier podcast about the 340B drug pricing program. I'm your host, David Glendening with 340B Health. Our guest for this episode is our own Stephen Miller.

Another round of Medicare price caps under the Inflation Reduction Act will affect hospitals starting in 2027. Although those changes are still six months away, there are important financial projections hospitals should be doing now on this issue, as well as tracking some relevant drug pricing changes that are already happening. We sat down with Steve to sort through all these factors and to get his advice on how 340B hospitals should be preparing for the future.

Here's that conversation. I am sitting with Stephen Miller, our vice president of pharmacy services and education. And a veteran of the podcast at this point. Steve, thank you for joining us and welcome back to 340B Insight. Thank you, David. It is great to be here. So your title here is very appropriate for what we're talking about today, which is the effects of the Inflation Reduction Act on 340B savings.

I will say it feels a little bit strange to be speaking about 2027 when we are not even halfway through 2026. But I also know there's some big things coming up next year that everyone needs to be preparing for now. So with that in mind, please remind listeners what is actually changing in 2027 under the IRA and why does it matter for 340B?

It's important really to look ahead to 2027 now that we have a few months under our belt, so to speak, with the IRA now in 2026. And so it's implemented in January of this year. But for 2027, the program is expanding to another 15 high-cost drugs that are reimbursed under Medicare Part D.

So for 2026, there are about five conditions overall that are being treated by the 10 drugs that went into effect. When we add 15 more to 2027, we're now treating 10 conditions. Of course, all of the drugs being subject to the IRA and Medicare price caps have direct implications for 340B savings and overall margins

because these drugs affect more than just Part D. Overall, we expect it to be negative to not just to 340B but to all dispensing pharmacies. This together reinforces the need to plan now for 2027 before waiting for all of the changes to materialize as the program evolves in 2027.

So clearly there's a financial picture emerging here that everyone is trying to get into focus. So what do you see as the biggest financial factors that hospitals should be thinking about right now? The biggest factor really is the reduction in 340B savings for the affected drugs. Some of the savings will disappear completely.

And we're going to see that very shortly with a drug that was introduced on the MFP maximum fair price ...

How To Calculate How the IRA Will Affect 340B in 2027

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How To Calculate How the IRA Will Affect 340B in 2027

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.