The 340B Drug Pricing Program is a U.S. federal program created in 1992 that enables eligible healthcare organizations, often referred to as “covered entities,” to purchase outpatient drugs at significantly reduced prices. Administered by the Health Resources and Services Administration (HRSA), the program is designed to stretch scarce federal resources and provide medications to underserved populations.
Eligible Entities include hospitals serving a disproportionate share of low-income patients, children’s hospitals, federally qualified health centers (FQHCs), and other organizations that meet specific criteria.
While primarily for outpatient drugs, the program allows savings across various areas such as pharmacy operations and broader patient care services.
The 340B Drug Pricing Program plays a critical role in enabling healthcare facilities to expand comprehensive services for the underserved and most vulnerable communities. By providing access to drugs at reduced prices, the program allows covered entities to allocate saved resources towards enhancing patient care and providing additional health services.
It ensures high-cost medications can be provided at more affordable prices, which translates to increased access for patients who otherwise could not afford necessary treatments. Facilities can use the extra financial resources to invest in patient support services, such as improved healthcare delivery systems, outreach programs, and mental health services.