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The future of 340B: What health system leaders need to know in 2025 and beyond

News
Apr 02, 2025
Blog, Maxor

As the 340B program faces unprecedented pressure from legislators, manufacturers, and courts, health system leaders must prepare for a new era of increased scrutiny, legal complexity, and strategic adaptation.

That was the clear message from a recent expert-led webinar hosted by Maxor, where thought leaders Ted Slafsky (340B Report), Emily Cook (McDermott Will & Emery), and Nicole Shoquist (JPS Health Network) offered real-time insights into the evolving 340B landscape. Moderated by Maxor’s VP of commercial analytics, William Riley, the session zeroed in on legislative and legal threats, contract pharmacy restrictions, transparency debates, and what hospitals must do to protect and future-proof their programs.

Here are the top takeaways for health system leaders:

  • Legislative change is likely, but the direction is uncertain
  • Contract pharmacy: The legal and strategic battleground
  • Transparency is coming, and it could be a good thing
  • Misconceptions about ‘profits’ undermine the mission

Legislative change is likely, but the direction is uncertain

Key insight: Expect movement on Capitol Hill—but not necessarily in favor of hospitals.

With new leadership in key congressional committees, including known 340B skeptics, pressure on the program is ramping up. While some champions like Senate Majority Leader John Thune may seek bipartisan solutions to restore contract pharmacy access, the current political climate makes a sweeping federal fix uncertain.

“There’s going to be a tremendous amount of attention… but whether any of it gets to the finish line is unclear.” Ted Slafsky, 340B Report

Key insight: Covered entities should not rely on contract pharmacy strategies alone.

Over 40 manufacturers have restricted contract pharmacy use for hospitals, with ongoing litigation dragging out solutions. Nicole Shoquist advised that internal capture strategies, such as bringing prescriptions back into entity-owned pharmacies, are more reliable in the near term.

“Reliance on contract pharmacy is incredibly risky right now.” Nicole Shoquist, JPS Health Network

Meanwhile, several states have enacted laws to protect covered entities from these restrictions, but most are tied up in court. Emily Cook noted that some early rulings have favored states, hinting at possible momentum at the state level even if federal reform stalls

Transparency is coming, and it could be a good thing

Key insight: Prepare now for increased reporting and public accountability.

Panelists agreed that more explicit reporting on 340B savings use is inevitable—potentially even as part of future federal legislation. While many hospitals fear an increased administrative burden or misinterpretation of data, experts say this is also an opportunity.

“There are great stories to tell. We just need to find better ways to tell them.” Ted Slafsky

Emily Cook recommended visible, public-facing examples like signage on mobile clinics or school-based programs to illustrate the impact of 340B. Transparency should not only be reactive but proactive, helping stakeholders and communities understand the value of the program.

Misconceptions about ‘profits’ undermine the mission

Key insight: 340B critics often misunderstand the nonprofit reality.

Panelists pushed back hard on the narrative that hospitals are profiteering from 340B. Only nonprofit and government hospitals can participate, and 340B savings often fund essential, margin-negative services that would otherwise be unavailable.

“Critics should walk the halls of safety-net hospitals before making assumptions.” Nicole Shoquist

From mobile health vans serving the unhoused to school-based clinics providing asthma care, these programs depend on 340B. Leaders should frame the conversation around community impact and access to care, not margins.

How to prepare your organization

As FY25 approaches, health system leaders should:

  • Evaluate risk exposure to contract pharmacy restrictions and explore in-house alternatives.
  • Enhance internal reporting and storytelling around 340B savings and their impact.
  • Track state-level developments that could restore access or shape policy precedent.
  • Invest in advocacy and education, both for policymakers and local communities.

The 340B program remains a lifeline for safety-net providers. But the future depends on how well leaders adapt, communicate, and engage in shaping what comes next.

“As an attorney advising participants, I can tell you that most want to follow the rules. They just need to know what they are.” Emily Cook

We’d like to say a special thank you to our guests, Ted Slafsky, Emily Cook, and Nicole Shoquist. We appreciate your time, dedication to 340B, and your valuable insights.

Further reading

Learn more

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