340B Rebate Pilot Program Remains on Pause as HRSA Extends Comment Period

The 340B rebate pilot program, designed to modify the distribution of drug discounts to providers, remains on hold, with the Health Resources and Services Administration (HRSA) extending the public comment period on a potential rebate-based model to April 20. Comments were originally due March 19.

Under the existing 340B Drug Pricing Program, drug manufacturers must offer outpatient medications at significantly discounted prices to eligible health care organizations, including those that serve vulnerable patient populations. According to HRSA, 340B-covered entities purchased $81.4 billion in outpatient drugs in 2024. The rebate pilot, originally set to begin Jan. 1, was to transition manufacturers from providing upfront drug discounts to issuing rebates to safety net providers. Covered entities would pay full list price at the point of purchase and subsequently submit detailed claims data to rebate platforms following the dispensing of eligible drugs.

The pilot was met with pushback from providers and advocates given the administrative burden and potential cash-flow challenges while pending reimbursement. Just days before the Jan. 1 start date, the program was paused and remains on hold, facing necessary modifications. Manufacturers generally supported the rebate model because it would provide deeper visibility into how providers use 340B drugs, helping to prevent duplicate 340B–Medicaid discounts and strengthen their oversight through the 340B audit process.

HRSA has issued a request for information (RFI) asking stakeholders whether it should pursue a rebate-based model for the 340B program and how such a model should be structured. The agency is seeking detailed feedback on the potential impact to providers, manufacturers, pharmacies and other stakeholders, including administrative and operational burdens, staffing and resource implications, and information technology and system requirements needed to support a rebate program. HRSA is also soliciting comments on how a rebate model could affect provider cash flow, and notes that a future model may include parameters governing when manufacturers can deny rebate claims. HRSA has advised that stakeholders should respond using estimates, ranges, aggregated data or general descriptions, and should not include privileged, confidential, or proprietary commercial or financial information.

HRSA has noted "the scope of the potential 340B rebate model pilot program will be limited to manufacturers with Medicare Drug Price Negotiation Program Agreements with the Centers for Medicare & Medicaid Services for the initial price applicability years 2026 and 2027." This language implies that the scope of a future pilot program could include more than the original 10 drugs from the initial planned pilot program, but also the 15 drugs with a 2027 initial price applicability year.

Providers and stakeholders have a rare window to influence whether a rebate-based model is viable.