Bill > SB124

This bill, named the "Saving People Money on Prescription Medications Act," introduces comprehensive regulations for nonprofit hospitals participating in the federal 340B drug pricing program. The bill defines key terms like 340B drugs (discounted outpatient medications) and establishes strict guidelines for how hospitals can use 340B net revenue (the difference between market and acquisition costs of drugs). Specifically, nonprofit hospitals are prohibited from using these revenues for executive salaries, board expenses, advertising, lobbying, travel, gifts, and entertainment. Instead, hospitals must spend at least 80% of 340B net revenue on direct patient services or capital improvements that increase healthcare access for low-income populations, which can include charity care, covering payment gaps for Medicare and Medicaid, supporting community health centers, and providing unreimbursed healthcare services. The bill also mandates detailed annual reporting on 340B drug transactions, including acquisition prices, market prices, and payments to contract pharmacies. Additionally, the legislation prevents manufacturers and other entities from restricting or discriminating against 340B covered entities' ability to acquire and distribute 340B drugs. Starting in November 2026, the Joint Budget Committee will annually request information about potential state medical assistance program losses related to 340B drug purchases and practices.

Health and Social Services

https://leg.colorado.gov/bills/sb25-124