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State treasurer accuses North Carolina hospitals of putting profits over patients

State Treasurer Dale Folwell said he has tried several times to negotiate with Nova Nordisk, Eli Lilly and NC State Health Plan’s pharmacy benefit manager.
Annette Weston-Riggs
Public Radio East
State Treasurer Dale Folwell said he has tried several times to negotiate with Nova Nordisk, Eli Lilly and NC State Health Plan’s pharmacy benefit manager.

North Carolina’s treasurer is calling out non-profit hospitals across the state for not passing along savings from a federal medical program to patients.

"They're putting profits over patients,” said North Carolina State Treasurer Dale Folwell.

The Federal Safety-Net 340B Drug Pricing was set up to help providers offer service to low-income patients and rural communities. Under the program, hospitals can buy most outpatient drugs with an average 35 percent discount from drug manufacturers.

But the hospitals have no legal obligation to pass those discounts on to their patients or to invest the savings in care for vulnerable communities.

Folwell said he’s tried to reach out to hospital CEOs to discuss the issue, but they haven’t been willing to talk and instead have issued written statements about the concerns.

He said, "Any public official who is unwilling to talk to anyone about any of the serious problems that are facing our society right now and refuses to do so should resign.”

Many 340B hospitals are pocketing the difference, Folwell said, and "The discount should be passed on to the patients.”

And he compared leaders of those hospitals to a crime syndicate.

“When people have a fear of getting the procedure because of the fear of the bill, where they have poor track records of matching their charity care with the billions of dollars of tax benefits, when they put liens on people's houses and break their kneecaps for not paying their bill, we are a long way away from solving these problems ... but that's how cartels work,” Folwell said.

The treasurer said 340B hospitals charged state employees “massive markups” for oncology drugs, and generated oversized profits on cancer drugs paid for by the North Carolina State Health Plan for teachers and state employees.

Folwell said the program was not intended to pad the salaries of hospital leadership.

Annette is originally a Midwest gal, born and raised in Michigan, but with career stops in many surrounding states, the Pacific Northwest, and various parts of the southeast. An award-winning journalist and mother of four, Annette moved to eastern North Carolina in 2019 to be closer to family – in particular, her two young grandchildren. It’s possible that a -27 day with a -68 windchill in Minnesota may have also played a role in that decision. In her spare time, Annette does a lot of kiddo cuddling, reading, and producing the coolest Halloween costumes anyone has ever seen. She has also worked as a diversity and inclusion facilitator serving school districts and large corporations. It’s the people that make this beautiful area special, and she wants to share those stories that touch the hearts of others. If you have a story idea to share, please reach out by email to westona@cravencc.edu.