California’s Proposition 34: Aims to Regulate Prescription Drug Discount Program

California voters are set to decide on Proposition 34 in the upcoming elections, a measure that targets the use of funds from federal prescription drug discount programs. This proposition is specifically aimed at preventing the misuse of funds by health care providers who benefit from these programs.

Proposition 34 would mandate that providers using federal discount drug programs, such as the 340B Drug Pricing Program, spend at least 98% of the funds they receive from these programs on direct patient care. This move is intended to prevent health nonprofits and other providers from using the money for other purposes that may not directly benefit patients.

The proposition has garnered significant attention, particularly due to its potential impact on the AIDS Healthcare Foundation (AHF), a Los Angeles-based organization. AHF has been a major beneficiary of the 340B program and has been accused of misusing the funds. The organization has labeled Proposition 34 as a “revenge proposition,” suggesting it is targeted specifically at them.

Supporters of the proposition argue that it will ensure transparency and accountability in how these federal funds are used, preventing them from being diverted to administrative costs, lobbying, or other non-patient care activities. However, opponents, including AHF, argue that the proposition could harm the ability of organizations to provide comprehensive care and services to their patients.