How 340B Is Impacting Union Health Plans
A $1 Billion Hit to Union Health Plans
The 340B program was created to help vulnerable patients afford medications. But new research shows its rapid expansion is driving up costs for union workers and their families.
An independent study found that 340B increases prescription drug spending for Taft-Hartley health plans by 4.7% per claim, totaling an estimated $1 billion in additional annual costs across the 5.2 million Americans covered by union health plans.
As the program continues to grow, increasing by 24% in 2023 alone, those costs are expected to rise.
Why Are Costs Increasing?
Taft-Hartley plans rely on manufacturer rebates to help manage prescription drug costs.
However, when prescriptions are filled under 340B:
- Negotiated rebates are generally unavailable
- Plans lose savings they depend on
- Net drug costs increase
Why It Matters to Union Workers
Taft-Hartley plans provide portable health coverage for union members working across multiple employers and job sites. Rising prescription drug costs put pressure on these plans and threaten long-term benefit stability.
Union workers should not bear the hidden costs of a federal program that lacks sufficient transparency and oversight.