340B Drug Pricing Program

340B Drug Pricing Program is a federal program in the United States that requires drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at significantly reduced prices. The program was established by the Veterans Health Care Act of 1992 and is managed by the Health Resources and Services Administration (HRSA).

Overview[edit | edit source]

The 340B Drug Pricing Program is named after Section 340B of the Public Health Service Act. The program allows certain hospitals and other health care providers, referred to as "covered entities," to purchase prescription drugs at discounted prices. The goal of the program is to enable these entities to "stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services."

Eligibility[edit | edit source]

Covered entities that can participate in the 340B Program include certain federal grantees, Federally Qualified Health Centers, and certain types of hospitals including Disproportionate Share Hospitals, children's hospitals, and cancer hospitals. These entities must be nonprofit and receive federal funding.

Operation[edit | edit source]

The 340B Program requires drug manufacturers participating in Medicaid to sell outpatient drugs at discounted prices to covered entities. These entities can then provide the drugs to eligible patients, either directly or through contracted pharmacies. The program does not require the covered entities to pass the discounts on to patients, but many choose to do so.

Controversies[edit | edit source]

The 340B Program has been the subject of controversy and legal challenges. Critics argue that the program lacks transparency and oversight, and that some covered entities may be profiting from the discounts rather than passing them on to patients. Supporters of the program argue that it provides vital support to hospitals serving low-income and uninsured patients.