Kentucky hospitals testify they need drug discount program under attack by pro-Trump group
FRANKFORT — A bill aimed at strengthening access in Kentucky to a federal program that generates income for charity health care passed a Senate committee Wednesday, with several rural hospital executives telling lawmakers it has helped keep them in business.
The program 'undoubtedly saved our hospital,' said Angela Portman, CEO of Breckinridge Health Inc., a 25-bed independent hospital in Hardinsburg. 'We were out of options.'
Several speakers attempted to express concerns about how Senate Bill 14 would affect the federal 340B Drug Pricing Program but were cut short by Sen. Stephen Meredith, R-Leitchfield, chairman of the Senate Health Services Committee and sponsor of SB 14.
Meredith warned beforehand he didn't want to hear testimony about the federal program, subsidized through deep discounts from the pharmaceutical industry. Any reforms to the program overall must come at the federal level, where legislation is pending, he said.
Critics of SB 14, including a representative of the Pharmaceutical Research and Manufacturers of American, of PhRMA, came forward to testify.
'We will not have a debate on 340B today,' Meredith said. 'We can't change that. It's federal law.'
But a national 'dark money,' pro-Trump group, Building America's Future, showed its opposition Wednesday by driving a truck with a flashing sign board around the Capitol with alternating messages including its claim that '340B is subsidizing gender transitions for kids.'
'Tell state Republican: STOP 340B,' it said, with a notice that it was 'paid for by Building America's Future.'
Supporters of the program in Kentucky have rejected that claim as baseless, pointing out Kentucky's Republican-controlled General Assembly banned gender affirming care for minors in 2023 and the program is chiefly aimed at generating revenue hospitals and clinics use to expand health resources for the poor.
'This is a very critical program for our hospitals and access to care in rural communities,' Nancy Galvagni, president of the Kentucky Hospital Association, said at the hearing.
The outside group, which has been linked to Elon Musk, an advisor to President Donald Trump, said in a recent press release it has launched a 'five-figure' television and podcast ad buy appealing to Republicans to oppose pending bills in Utah, Nebraska, North Dakota and Kentucky, describing 340B as an 'out-of-control government program' that is 'secretly sabotaging' Trump's agenda.
No one from the group spoke at Wednesday's hearing and Meredith didn't address its claims in the 45-minute discussion of SB 14. The group has not responded to the Lantern's request for comment.
Rather, Meredith limited discussion to SB 14, which he said would preserve benefits to Kentucky health providers.
The 340B program, authorized by Congress in 1992, was meant to aid health providers by giving them more money to help low-income patients, including providing lower cost drugs.
Created with the support of the pharmaceutical industry, it required drug manufacturers to provide drugs at discounts of up to 50% to hospitals and clinics that provide care to a certain percentage of low-income patients including those covered through Medicaid, the state-federal health plan.
Hospitals and clinics provide those discounted drugs through pharmacies, then bill insurers including Medicaid for the market price of the drugs and keep the difference — the goal being to use those resources for low-income patients.
But it has expanded rapidly over the years, aided by changes in federal law that the pharmaceutical industry and some consumer advocates argue have allowed national pharmacy chains and major health systems to benefit from 340B at the expense of consumers and low-income patients it was supposed to help.
KY health care providers depend on drug discount program that's facing fire on several fronts
'Our members believe this bill does not protect patients,' said Russell Palk, with the Biotechnology Innovation Organization, a Washington D.C.-based trade association. 'It does not lower their out-of-pocket costs.'
Meredith rejected that assertion.
'I don't believe that's true,' he said.
Rather, he said, his bill — similar to legislation enacted in other states — would merely prevent pharmaceutical manufacturers from discriminating against Kentucky by requiring them to provide the same drugs at the same discounts as they do in other states. As 340B has grown, some pharmaceutical manufacturers are restricting discounted drugs they will ship to Kentucky, he said.
The program provides an estimated $122 million a year in additional revenue for health care in Kentucky, he said. 'Why should we not be allowed to have this funding when other states are?'
Meanwhile, hospital CEOs told the panel Wednesday that income from 340B is critical to providing patient care, especially for cancer treatment where chemotherapy drugs can cost tens of thousands of dollars.
'Cancer treatment is expensive and without the 340B program many of our patients simply would not have access to it,' said Brian Springate, CEO of Appalachian Regional Healthcare's Hazard hospital.
SB 14 passed the committee on a 9-1 vote and now goes to the full Senate.
A similar bill last year sponsored by Meredith passed the Senate but died for lack of action in the House.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
UPI
37 minutes ago
- UPI
Calif., Illinois may fight new Texas congressional maps with their own
1 of 2 | California Gov. Gavin Newsom says he may seek to change his state's congressional maps if Texas redraws its borders. File photo by Jonathan Alcorn/UPI | License Photo July 26 (UPI) -- As the Texas Legislature plans to redraw congressional maps in an effort to increase Republican members in the U.S. House, the governors of California and Illinois may devise their own new borders. Traditionally, the boundaries are changed every 10 years with the latest U.S. Census data but Texas Gov. Greg Abbott has called a special legislative session after pressure from the White House to preserve the GOP majority in the U.S. House. President Donald Trump believes an additional five seats could be created by changing the borders. Of the state's 38 districts, 25 are held by Republicans. Democrats hold seats in big cities of Austin, Dallas, El Paso, Fort Worth, Houston, Laredo, McAllen, San Antonio. Ahead of the 2026 midterm elections, Republicans hold a 219-212 advantage in the House with four vacancies -- three Democrats who died and one Republican who resigned this week. More than a dozen Texas House members flew to Illinois and California -- two blue states -- on Friday for a meeting with California Gov. Gavin Newsom and Illinois Gov. JB Pritzkeper, during which they revealed their intentions. "Donald Trump called up Governor Abbott for one simple reason: to rig the 2026 elections. California's moral high ground means nothing if we're powerless because of it," Newsom said after meeting with Democrats from the Texas House. "This moment requires us to be prepared to fight fire with fire. Whether that's a special election, a ballot initiative, a bill, a fight in court. If they proceed in Texas, we will be ready." "This is not a bluff. This is real, and trust me, it's more real after listening to these leaders today, how existential this is," Newsom said. As the most populous state in the nation, California has 43 Democratic members of the house and nine Republican members, while Illinois is represented by 14 Democrats and three Republicans. "Everything is on the table," Pritzer said. The Illinois governor said he doesn't want to redraw the maps but "if they're going to take this drastic action, then we might also take drastic action to respond." "We want the country to understand [that] what's going on in Texas is a national battle," State Rep. Richard Pena Raymond, a Democrat from Laredo, said. Raymond told Pritzner that redistricting is "clearly aimed at affecting the entire country." Responsibility for determining Congressional district maps differs from state to state. In California, an independent commission approved by voters in 2010 works on the maps. Illinois maps, on the other hand, are put together by the state lawmakers have been drawn strongly to favor the Democrat Party in the state. Newsom said he is considering having a referendum to change the rules before the 2026 election, unless the Legislature comes up with another solution, which would take two-thirds of legislators voting in favor of. "We have to fight fire with fire," Newsom said. Other states Two other Democratic governors are considering new maps -- Phil Murphy in New Jersey and Kathy Hochul in New York. "There's other states that are violating the rules," Hochul said during a news conference on Thursday. "I'm going to look at it closely with Hakeem Jeffries," a New York member of the House, as well has House minority leader. In New York, Democrats have a 19-7 advantage as a result of their districting maps. "It's deplorable," Murphy said during an interview at the summer meeting of the bipartisan National Governors Association in Colorado Springs. "If they're going to play these games, we're going to have to be just as aggressive. We can't bring a knife to a gunfight." Democrats hold nine of the 12 seats in New Jersey. In Florida, the state Supreme Court on July 17 upheld its newest congressional map. He said he believes the state had been "malappropriated" and redistricting "would be appropriate" in a few years. Florida's congressional delegation is controlled by Republicans, 20-8. In Ohio, legislators are required to redraw maps before 2026. The GOP has 10 of the 15 seats. Colorado Gov. Jared Polis is against redistricting more frequently. The state's maps are overseen by an independent commission and it's eight U.S. House seats are evenly split 4-4. Texas situation Texas last redrew its borders in mid-cycle in 2003 after the GOP gained control of both chambers for the first time since Reconstruction. In Texas, Abbott noted a July 7 letter from the Justice Department that said majority Black and Hispanic districts in Dallas need to be redrawn based on a decision by the U.S. Court of Appeals for the Fifth Circuit last year. The DOJ said those districts are "unconstitutional racial gerrymanders," but Abbott argued the opposite in 2021. In federal court in El Paso, he argued race had not been taken into account there. "We are no longer compelled to have coalition districts," Abbott said in an interview with KDFW in Dallas. U.S. Rep. Joaquin Castro, a San Antonio Democrat, appeared at a state House hearing. "That's what's at stake here, whether you all are going to work for the people of Texas, as we used to do, to try to do, or whether you take your commandments from Donald Trump and the White House," Castro said. "I hope that you all will choose to do the business of the people of Texas, as this body has a history of being independent from the federal government."
Politico
37 minutes ago
- Politico
Democrats desperately look for a redistricting edge in California, New York and Maryland
Hochul's political allies believe there is little upside to drawing new lines. 'I understand those in New York who are watching what's happening in Texas and Ohio want to offset their unfair advantage,' said New York Democratic Chair Jay Jacobs. But 'the constitution seems pretty clear that this redistricting process should be done every 10 years. I don't know where someone could interpret it as something you can do every two years.' Beyond Texas, Republicans have their eye on picking up seats in other states like Missouri and Florida — which would put Democrats in a tough spot, given they don't have as much leeway to squeeze out extra seats. New Jersey Gov. Phil Murphy was noncommittal when asked by reporters earlier this week if he plans to pursue redistricting, noting that it's 'too early to make any definitive statement about it.' But he echoed what many other Democrats across the country have said when talking about the possibility of early redistricting: 'Never bring a knife to a gunfight.' New Jersey has its own constitutional impediment, which states that congressional districts, which are drawn by an independent commission, 'shall remain unaltered through the next year ending in zero in which a federal census for this State is taken.' Even if they were able to circumvent the state constitution, Democrats already have the majority in the New Jersey congressional delegation, and just two seats — the 7th, held by Republican Rep. Tom Kean Jr., and the 9th, held by Democratic Rep. Nellie Pou — are considered battlegrounds. Even some other Hail Mary options seem off the table. State lawmakers in Washington, Minnesota and Colorado balked at the suggestion they should pursue drawing new maps in the next few months. California Gov. Gavin Newsom, accompanied by several members of the Texas state Legislature, calls for a new way for California to redraw it's voting districts during a news conference In Sacramento, Calif., Friday July 25, 2025. | Rich Pedroncelli/AP 'It's just not in the cards,' said Washington House Majority Leader Joe Fitzgibbon, citing the requirement that a two-thirds majority is needed in both the state House and Senate to reconvene the state's bipartisan redistricting commission. And Minnesota State Sen. Aric Nesbitt shut down the idea quickly: 'We're not power-crats, we're Democrats. We should do things that improve democracy, even if that means sometimes we don't get our way.' Democrats hold the governorship and state Senate in Minnesota, but Republicans narrowly control the House.
NBC News
2 hours ago
- NBC News
Rick Huether, CEO of the Independent Can Company. Eric Kayne for NBC News Checkbook Chronicles Kicking the can down the road on tariffs won't work for this Maryland manufacturer Independent Can Company has raised prices twice this year already after Trump imposed 25% duties on steel in March, and then doubled them in June.
July 26, 2025, 7:15 AM EDT By Emily Lorsch When Rick Huether strolls the floors of his four manufacturing plants — two in Maryland and two in Ohio — employees' typical greetings such as, 'Hey, how's the family?' have been increasingly replaced with, 'Hey Rick, should I be looking for a job somewhere else?' Huether, the CEO of Independent Can Company, has had to raise prices on customers twice this year and it's the third time since President Donald Trump's first term. 'It's frustrating,' Huether said of the Trump administration's ever-evolving tariff agenda, which now includes 50% import taxes on the foreign-made steel his company relies on. 'I can't run my business the way I want to run it.' Huether, a Republican, said he shares the administration's goal of reinvigorating American industry. 'We want to bring as much manufacturing back to this country as you can. And as a family, we made a strategic commitment to being the specialty can maker in America with American workers,' he said. 'We want to be here.' But according to Huether, Trump has made that harder to do. He said he has never voted for the president because he dislikes how he treats people and communicates, and his trade policies have caused headaches for his business operations. 'Chaos is our nemesis,' Huether said, echoing a concern many small business owners have voiced for months amid Trump's erratic tariff rollout: 'We can't plan when we don't have a vision of what's going on for the next two or three years.' Business highlights Independent Can Company's wares might already be in your cupboard. The Belcamp, Maryland-based family business, in operation since 1929, makes the packaging for everything from Wegmans' brand of Virginia peanuts to the Santa Claus tins filled with chocolates or popcorn that hit grocery shelves around the holidays. The company manufactures cans and other containers for popular consumer brands including Swiss Miss, Zippo and Titleist. One of its newest customers is the lip balm maker Burt's Bees. Independent Can Company — whose annual sales have averaged $130 million in recent years — used to have more than 30 domestic competitors in specialty can making, Huether estimated, many of which were family-owned businesses. Today there are just a couple left, he said. The company employs about 400 people across its four plants. A fifth, in Iowa, closed in 2024 due to what Huether described as a combination of clients' shifting packaging needs and Trump's first-term steel tariffs. He secured some exemptions from those levies at the time but still had to raise prices in 2018 by anywhere from 8-16%, depending on the product. Independent Can Company's manufacturing process relies on a highly specialized material called tinplate, a very thin-gauge, flat-rolled steel with an electro-coated surface of tin. Developed as a corrosion-resistant material safe for food packaging, tinplate supplies are limited — the product makes up only about 2% of global steel production, Huether estimated, and it's only roughly 1% of the steel produced in the U.S. Up until about 2007, Independent Can Company bought most of its tinplate domestically but now sources most of it overseas — the majority from Germany, along with Taiwan and South Korea — due to foreign suppliers' quality, service and price. The business adopted more efficient production systems starting in the 1990s, which included a new printing line in 2000 that uses a larger sheet size, boosting efficiency. The issue: steel coils large enough for that system aren't available domestically right now, partly because American steel companies haven't kept up with manufacturers' needs, Huether said. In addition, the materials Independent Can Company uses are about twice as expensive in the U.S. than in Asia and about 20% more expensive than in Europe, Huether estimated. Tariff impacts The cost squeeze is weighing on Independent Can Company as it struggles to rebound from a rough two years, amid pandemic-related supply-chain issues and cost swings. Those challenges left the company with a lot of expensive steel that it had to sell at a loss. But after tens of millions in capital investments, including in automation, Independent Can Company is finally settling into a new normal that Huether expects to put the company back on surer footing this year, tariffs notwithstanding. Still, access to affordable tinplate is non-negotiable and remains a wild card. That material alone represents 50-75% of its products' prices, Huether estimated. With tariff exemptions removed in March, Independent Can Company began paying Trump's 25% levies on all its imported tinplate, a steep new expense that Huether said forced the business to hike prices on some products by 8-16%. After the duties were raised to 50% in June, the company imposed another round of 8-16% increases. 'This adjustment is necessary to ensure that we can continue to provide you with the high-quality products and service you have come to expect,' Huether informed clients in a statement on the company's website earlier this year. 'We've really absorbed the amount of the tariffs that we can absorb,' he told NBC News. 'It's going to be passed through.' Bringing the shine back to 'Made in America' Huether is relieved that Independent Can Company hasn't lost business yet since the price hikes, but that worry is ever-present. There's a risk that some companies will switch to cheaper packaging, he said, including options that may not be as safe or recyclable. But it's hard to know how things will shake out… 'You instantly go to: Well, is this going to happen, or is it a tactic to get somebody to do something else? Is it real or not?' he said. In the meantime, Huether doubts whether rewriting U.S. trade policy can bring back American manufacturing overnight, or even in a few years. Huether believes in expanding vocational training in schools and eliminating the stigma often associated with certain career paths. 'We do not have the skills in this country to manage it,' he said, nodding to a reality that companies and analysts across a range of industrial sectors have underscored since the trade war began. 'It takes one to five years to get a full manufacturing plant up and running,' Huether said. 'We need time to do this.' What's more, 'We need predictability and consistency,' he added. 'We need to understand what the rules are. If the rules are constantly changing, we don't know how to play the game.' Emily Lorsch Emily Lorsch is a producer at NBC News covering business and the economy.
