Q&A: How 340B Rebate Pilot Could Strain Community Pharmacies and Patient Access

In an interview with Pharmacy Times®, Martha Thorne, senior vice president and general manager of EnlivenHealth, explained how the 340B rebate pilot program could disrupt community pharmacies’ cash flow, increase administrative demands, and potentially limit access for underserved patients, while stressing the importance of data, partnerships, and advocacy to protect the program’s mission.

Pharmacy Times: How will the new rebate model pilot program specifically impact independent and community pharmacies that rely on 340B to serve their patients?

Thorne: In traditional 340B contract pharmacy arrangements, community pharmacies dispense subsidized drugs on behalf of covered entities (CEs) and often receive a dispensing fee and some shared savings per prescription.

Under the rebate pilot model, pharmacies will be dispensing full-priced commercially purchased drugs that CEs can later request a partial rebate for.

In both scenarios, CEs are the primary beneficiaries, with pharmacies acting as partners. However, under the pilot program, community pharmacies will face an increased administrative burden, cash flow uncertainty and, in some cases, reduced profit margins. This is because, while pharmacies are still acting as dispensary partners, they are not necessarily partners in the rebate benefits. They still must track and provide data to help identify rebate-eligible claims and comply with audit requirements, but the way the rebate is designed, it doesn’t capture spread (the difference between what the payer reimburses and the pharmacy’s acquisition cost). This makes participation in the 340B program riskier and potentially less profitable.

Pharmacy Times: From your perspective, what are the most significant operational and financial challenges for pharmacists adapting to a potential shift from an upfront discount model to a back-end rebate system?

Thorne: The 340B program covers entities like Ryan White clinics, federally qualified health centers, disproportionate share hospitals, rural health clinics and other safety-net providers that serve low-income or uninsured patients, many of whom rely on expensive, specialty drugs. The cost to procure these is not insignificant to a community pharmacy.

From the perspective of independent and community pharmacies, I think that cashflow piece will be the most significant challenge. Smaller pharmacies typically lack the financial reserves of larger chains and health systems, but in order to participate in a rebate based 340B program, they would have to invest more money upfront, with a higher risk of non-payment or delayed payment.

Pharmacy Times: How can pharmacists best prepare for the increased administrative and data reporting burdens associated with the new rebate pilot? What tools or strategies can help streamline this process?

Thorne: Covered entities will need to coordinate closely with their pharmacy partners to ensure data accuracy and compliance, since rebates are tied back to the CE’s eligibility and program use.

Pharmacists can get ahead of the changes by really leaning into tools and partnerships that make the process smoother. Automation is a big one. The more you can rely on software to handle claims, inventory, and reconciliation, the less room there is for error. It also helps to build strong relationships with your third-party administrators because they can play a key role in identifying 340B-eligible claims, submitting rebates, and keeping everything compliant.

Staff education is also critical. Teams need to be comfortable with the new eligibility rules and documentation requirements so the workflow doesn’t break down. I’d say that it has never been more important to advocate for transparency. Pharmacies should be pushing for clear rebate terms and predictable payments from manufacturers and the Health Resources Services Administration (HRSA) so that the financial side of the program remains sustainable.

Pharmacy Times: How might a rebate-based 340B program affect patient access to medications and overall care, particularly for low-income and underserved populations?

Thorne: The original purpose of the 340B program was really to help CEs stretch their federal resources further, allowing them to provide more comprehensive services, including medications, to vulnerable and underserved patient populations.

However, the cash flow disruption could force community pharmacies to pull back on the services or products they offer under the 340B umbrella. Ultimately, this might lead to access issues for vulnerable patients, which is completely counterintuitive to why the program started in the first place.

My initial concern was heavily focused on the community pharmacies, but I've realized it's a broader picture. The CEs (and therefore, the patients) actually bear the brunt of the impact if they lose their partners in this program. It's about understanding that relationship and ensuring we don't inadvertently create barriers to care for those who need it most.

Pharmacy Times: What can pharmacists do to ensure the savings from 340B continue to translate into expanded patient services and improved health outcomes, rather than being absorbed by administrative costs?

Thorne: Capture all of the data, and share it with CE partners. If pharmacies can tie savings directly to patient care improvements, they can help CEs make a strong case to policymakers and payers to expand services.

On the operational side, streamlining processes through automation and analytics makes it easier for both pharmacies and covered entities to capture rebates efficiently without getting bogged down in paperwork.

Pharmacists need to keep advocating. Push for rebate terms that are clear, payments that are timely, and protections that keep administrative costs from eating into resources that safety-net providers count on to fund care.

Pharmacy Times: Looking ahead, what is your outlook on the future of the 340B program? What steps should the pharmacy community take now to influence future policy changes and secure the program's intended purpose of supporting the safety net?

Thorne: The 340B program is at a critical juncture. The shift toward rebate-based models and manufacturer restrictions could undermine the program’s sustainability, particularly for smaller, community-based providers. However, growing awareness of its importance in serving vulnerable populations provides an opportunity for constructive reform.

Pharmacists can keep working with their covered entity partners to make sure the patient voice is heard. Sharing real-world data with lawmakers, pushing for more transparency in rebate structures, and protecting access in rural and underserved areas all have to be part of the conversation.

The future of 340B will likely depend on the ability to balance innovation with the safety-net mission of serving the underserved populations. CEs and pharmacists must be at the table during these policy discussions.

Pharmacy Times: Is there anything else that you would like to add?

Thorne: While innovation in payment models can be valuable, any changes to 340B must center on the needs of patients and the communities the program was designed to support. The rebate pilot must not become a mechanism that shifts cost and complexity onto small pharmacies while diluting the impact to the patient. The focus should remain on sustaining access, affordability, and high-quality care for those who need it most.