Taxpayers, get ready for another round of bailouts.
However, unlike Wall Street executives who begged Uncle Sam to cover their risky bets, cash-strapped nonprofit rural health care providers have not gambled away their resources.
Quite the contrary, they have done nothing irresponsible. The best part is that the bailout is not a fait accompli. And state lawmakers do not have to stand by and wait for a federal solution. The Florida Legislature and Governor DeSantis are not powerless. The simplest way to protect providers, and by extension, medically underserved Floridians, is by codifying the process by which eligible providers attain critical savings under the 340B Drug Pricing Program.
If drug makers get their way, they will shred Florida’s health care safety net. Their new scheme involves converting the current 340B payment model from upfront savings on drug purchases to rebates on the backend of transactions. The problem is that nonprofit health care providers rely on these critical savings to offset losses from delivering high-quality care that often receives below-cost reimbursements.
Here is what drug companies want: Delay.
The plan is to reimburse providers at an indeterminate future date, on their own terms, making every 340B claim subject to dispute and protracted payment. Drug companies understand that many rural providers operate on shoestring budgets. If they can slow-walk how covered entities attain 340B savings, providers face resource deficits they cannot overcome.
What if drug makers deny every initial rebate claim, extending the lifecycle of payments months down the road? The clinical outcomes of millions of rural Americans depend on their providers, often the sole provider they can access, receiving upfront 340B savings to keep their doors open.
In August, the Trump administration released guidance for a rebate model pilot program that displeased providers and the pharmaceutical manufacturers. Providers worry that savings from rebates will not be distributed to them in a timely manner. Drug makers fret that instead of a universal change, the administration opted for what they view as a half measure, and only for a subset of prescription drugs.
And here is where Florida’s Legislature has a role to play. The pilot program limits rebate conversion to the 10 drugs selected for the Medicare Drug Price Negotiation Program, an initiative in the Inflation Reduction Act. Florida has the authority to pass legislation shielding prescriptions paid for by private payers and the state Medicaid fund, limiting rebate conversion in 340B to only those drugs selected for negotiation in federally funded Medicare. Such legislation would not interfere with federal prerogatives, as states have the authority to control the dispensing of prescription drugs within their borders when they or private actors are the payors.
Florida should act now to preempt drug companies that seek to convert all 340B savings, regardless of the payor, into rebates. If state lawmakers remain idle, expect foreseeable consequences.
Since 2010, 89 rural hospitals have closed, including five in Florida. Another 65 underwent “converted closures,” defined by reducing or eliminating services, changing locations and/or closing facilities. According to a 2025 analysis from the Center for Healthcare Quality and Payment Reform, 760 rural hospitals are at risk of closing, with 40% facing immediate risk. In Florida, nine rural hospitals (41%) are at risk of closure, with two hospitals facing imminent peril.
Recognize that the current financial reality would have occurred even with the critical savings enabled by the 340 B program. The fundamental changes to the 340B program sought by drug companies would cause catastrophic harm to health care in rural America.
Gov. Ron DeSantis signed landmark pharmacy benefit reform legislation into law in 2023. The Prescription Drug Reform Act loosened the stranglehold PBMs had over the state’s prescription drug supply chain. State lawmakers, however, have yet to protect 340B providers from drug companies bent on limiting the number of prescriptions available at discounted prices.
Florida is one of five states where contract pharmacy protection legislation died in its Legislature in 2025. HB 1527 would have prohibited drug manufacturers from taking actions that interfere with how 340B providers acquire drugs and PBMs from discriminatory reimbursements to said providers.
Florida should not leave its rural 340B providers to the whims of national politics. Federal solutions take too long to materialize, if they happen at all. The attorney general should file suit against any drug company that attempts to expand rebate conversion beyond the parameters of the pilot program. Lawmakers should reintroduce HB 1527 with the added provision that prohibits drug companies from expanding their rebate scheme.
Drug companies are undertaking a multi-pronged effort to dismantle 340B. The Legislature has the power to protect rural nonprofit providers. The time to act is now.
___
John Arcano is the senior manager of policy and government affairs at AIDS Healthcare Foundation.