The Honorable Beverly Gossage, Chairman
The Honorable William Sutton
2025 Special Committee on Pharmaceutical Studies
Kansas State Legislature
10th and Jackson
Topeka, Kansas 66612
Dear Chairman Gossage, Vice Chairman Sutton, and Members of the 2025 Special Committee on Pharmaceutical Studies:
On behalf of National Taxpayers Union (NTU), America’s oldest taxpayer advocacy organization, I thank you for the opportunity to weigh in on the 340B Drug Program. Kansas taxpayers are footing the bill for a federal drug discount program that simply doesn’t work. I commend your committee’s review of 340B because it’s both necessary and urgent. Earlier this year, I testified before the Kansas Senate Financial Institutions Committee in opposition to SB 284, a 340B drug pricing mandate bill.
My concerns remain the same today as they were then: the program is deeply flawed, and state-level mandates like SB 284 would only double down on Washington’s mistakes.
Before I served as a Wisconsin state senator, I spent years as a pediatric nurse practitioner in settings that participated in the federal 340B drug pricing program. I saw firsthand the families this program was designed to serve—patients struggling to afford lifesaving medications, parents desperate for help in managing their children’s chronic conditions. Later, as a legislator, I saw how well-intentioned federal programs, when left unchecked, can produce unintended consequences that ultimately fall on state budgets and taxpayers. These two perspectives—those of the clinician and the policymaker—shape my testimony today.
The 340B program was created in 1992 to help low-income and uninsured patients access affordable medications. But in reality, it has become an opaque revenue stream for hospitals and pharmacies, with little accountability to ensure that savings are passed on to patients. The result is twofold: taxpayers lose, and patients lose. The only winners are hospitals that turn 340B into a profit center.
Evidence confirms this:
A 2024 Pioneer Institute report found that nearly 50% of Kansas 340B pharmacies are located in affluent neighborhoods, far from the underserved communities they were intended to serve.
Meanwhile, the top Kansas 340B hospitals provide less charity care (1.5%) than the national average (2.15%). That means Kansas patients in need are not seeing the benefits, even as hospitals profit.
Utah is projected to lose nearly $2 million in rebates due to even a modest increase in 340B purchases—costs that taxpayers will ultimately absorb.
North Carolina found hospitals charging cancer patients five times the actual drug cost, leaving patients crushed by bills and taxpayers saddled with a $32 billion unfunded liability in the State Health Plan.
Minnesota reported that 340B hospitals generated at least $630 million in net revenue, with little transparency about whether low-income patients actually benefited.
Layered on top of these failures is a legal risk: courts—including a December ruling by the U.S. District Court for the Southern District of West Virginia—have confirmed that states cannot impose mandates that conflict with federal law. If Kansas adopts SB 284-style mandates, taxpayers will pay twice—first through costly lawsuits, and again through higher state healthcare costs.
Rather than expanding an unaccountable system, Kansas should focus on transparency and accountability by requiring participating hospitals and pharmacies to demonstrate how they utilize 340B savings to directly support patients in need. But the most meaningful reforms can only come from Congress and federal regulators. NTU has submitted recommendations on federal 340B reform, including support for a federal rebate model pilot program. Kansas should not codify flawed aspects of federal law into state statutes. Instead, Kansas can demand transparency at the state level, while urging federal lawmakers to make the broader fixes needed to ensure the 340B program works for patients—not as a profit center for hospitals.
As a former nurse practitioner, I cannot ignore that patients who need help continue to fall through the cracks. As a former state senator, I cannot ignore that taxpayers are subsidizing a program with little evidence of value. Both burdens are real—the fiscal and the human—and I urge you to protect Kansans from both. The bottom line: Don’t import Washington’s failures into Kansas law. Demand accountability before another taxpayer dollar is wasted.
Thank you for your time and your thoughtful review of this critical issue. I would be happy to share further insights from both my healthcare and legislative experience.
Respectfully submitted,
Leah Vukmir
Senior Vice President of State Affairs
National Taxpayers Union