340B Participation and Safety Net Engagement Among Federally Qualified Health Centers

The 340B program provides discounts on outpatient drugs to certain hospitals and federally supported clinics (covered entities) that can be used to generate revenue to fund safety net care. While numerous studies have found no association between 340B and safety net care provision for most hospital covered entities, less is known about whether federally qualified health centers (FQHCs), the largest group of covered entities after hospitals, use the program to enhance safety net care.

To assess whether a proxy for 340B revenue was associated with increased safety net care provision among FQHCs.

This descriptive, retrospective cohort study examined care provided from 2005 to 2022 by 1468 FQHCs that submitted to the Health Resources and Services Administration Uniform Data System. FQHC and year-level fixed effects were included, as well as a control for differential Medicaid expansion over time. The data were analyzed between March and December 2023.

One-year lagged number of locations registered to dispense or administer 340B-discounted drugs (registered locations), which included child sites, in-house pharmacies, and contract pharmacies in the 340B Outpatient Pharmacy Affairs Database.

Natural logarithm of patient volume by payer, low-income status, and use of enabling services. Natural logarithm of visits in which low-profit preventive services were provided.

An additional registered location was associated with increased patient volume, especially for uninsured (0.4%; 95% CI, 0.3%-0.5%) and privately insured (0.4%; 95% CI, 0.2%-0.5%) patients and low-income (0.4%; 95% CI, 0.2%-0.6%), unhoused (0.3%; 95% CI, 0.1%-0.5%), and non-English-speaking (0.3%; 95% CI, 0.1%-0.5%) patients. An additional registered location was associated with increased visits with an HIV test (0.7%; 95% CI, 0.4%-0.9%), serum lead test (0.8%; 95% CI, 0.6%-1.1%), seasonal influenza shot (0.4%; 95% CI, 0.3%-0.5%), Papanicolaou smear (0.5%; 95% CI, 0.4%-0.7%), and tobacco cessation counseling (1.0%; 95% CI, 0.5%-1.4%). Across the study period, the average annual increase in locations was 1.5.

The results of this cohort study suggest that there are statistically significant increases in the provision of low-profit but high-value preventive services and care to safety net populations (those who lack insurance, have a low income, or require enabling services) and that, like public hospitals, FQHCs might use 340B revenues to enhance safety net care. This finding may inform debates on the 340B program by supporting differential 340B reforms across hospital and nonhospital covered entities.