Nonprofit hospitals

Medicare proposes reducing payments to hospitals for drugs under the 340B program by over a third, citing surveys showing some patients paid more than hospitals. The change, part of a hospital outpatient payment rule, faces criticism from nonprofit and academic hospital groups, who argue it will harm safety-net providers, as only nonprofit facilities qualify for 340B discounts.

The chair of the Senate health committee introduced a bill to restrict the 340B drug discount program, which has been lucrative for nonprofit hospitals. The bill comes as hospitals face financial pressures from Medicaid changes and potential site-neutral payment legislation, with the 340B program under scrutiny for future healthcare spending cuts.

Nonprofit hospitals spend billions of dollars on management consultants with no clear effect on their operations. The spending has raised questions about the effectiveness of these consulting services. Nonprofit hospitals' use of consultants is under scrutiny.