Opinion: Hospitals Are Pocketing Dollars Intended For Charity Care

Hospitals are places of healing and should not harm those who seek care, especially uninsured and low-income patients. These patients are harmed when they are not able to pay for expensive medical care or costly prescriptions. They often go untreated. My faith teaches me this is wrong: everyone is made in the image of God and deserves health care, regardless of how much money they have.

As we enter year three of fighting the coronavirus pandemic, we must acknowledge the strengths of our health care system while working to fix its weaknesses. We have seen some incredible medical innovations these past few years, from vaccines to booster shots to widespread testing. However, our hospitals are still packed due to the new omicron variant, millions of Americans are without health insurance, and medical care is still too expensive for so many Ohioans.

If we rewind 30 years, we’re able to shine a light on the start of one of the root problems with the health care industry that has increasingly harmed people in need of medical care.

The federal government created a well-intentioned program that provided drug discounts to hospitals, the savings from which were intended to be used to provide charity care. The program, known as the 340B Drug Pricing Program, intended to help make health care affordable for uninsured and low-income patients seeking care at a community health center and nonprofit hospitals. It has not worked.

When it was designed, the program did not define exactly how hospitals must use the savings from their drug discounts from the federal government. This lack of clarity has allowed huge corporate hospitals to claim they are “nonprofit charity hospitals” and take advantage of the program by giving away very little charity care while pocketing the savings. I am disheartened by the egregious abuse of the program, which was meant to help the most vulnerable patients. This corporate greed continues to disrupt the lives of low-income people and deny their God-given dignity.

The scale of the problem is shocking. The program was originally intended to provide discounts to a small group of 90 charity care hospitals, but now covers more than 2,500 hospitals posing as “nonprofit charity hospitals” or 340B hospitals.

A national study conducted by the Pacific Research Institute took a detailed look at two of Ohio’s 340B hospitals: Good Samaritan Hospital in Cincinnati and Miami Valley Hospital in Dayton. Both hospitals generated hundreds of millions in net patient revenue over the two recent years that the study covered, but gave away tiny amounts of this revenue (0.66% and 1.36% respectively) to charity care.

This massive growth of the 340B program has been the most damaging to patients accessing cancer treatments. Research shows that most of the acquisitions of community oncology clinics have been by hospitals in the 340B program, and that patients who received chemotherapy entirely in the hospital outpatient setting paid much higher treatment costs than patients whose chemotherapy was delivered entirely in a physician’s office. This is particularly devastating for the roughly 25,100 Ohioans dying of cancer every year. Why should they be forced to pay more for care just so these hospital corporations can get another payday?

The 340B program was meant to provide much-needed drug discounts to hospitals providing charity care to low-income and uninsured patients. However, it’s clear Congress needs to close the loopholes in the program to stop greedy hospital corporations from doing harm by manipulating the system and profiting off the patients they are supposed to be helping.

My faith compels me to confront this immoral greed and work for robust access to health care for all of God’s children.