340B Drug Pricing Program - A Complete Overview

340B Drug Pricing Program – A Complete Overview

An excellent initiative was taken by the US Federal Government in the year 1992 in the form of the 340B program. This program requires the manufacturers of drugs to offer the medicines to selected healthcare organizations and covered entities at a discounted price. This initiative began in the year 1990 by the Congress and came into complete effect in 2 years.

Main Reasons for Establishment of 340B Program

The 340b drug pricing program has served a lot of covered entities over the years. The move was warmly welcomed by the healthcare organizations too. The two main reasons for the establishment of the program are:

  • Reducing the Medication cost for the most vulnerable population of the nation
  • Reaching the eligible patients to offer comprehensive medical support

In this fashion, the covered entities can stretch the resources of the federal government to help save the patients from grave diseases. Also, the cost of the drugs is fairly reduced thereby reducing the overall medical expenses.


The program is operated and administered by the Office of Pharmacy Affairs. In addition to support from OPA, there are a few 3rd party entities that help care organizations and hospitals to operate impeccably with robust software support.

MediaRX’ssoftware solutions offer the best support on 340b drug pricing program. It helps in inventory management and complete pharmacy network support. They provide cloud software support to many organizations that treat the most vulnerable patients. They also give training to your staff and management teams, so that you can manage the program without any issues.

Who is eligible to be a part of the 340B program?

The eligible parties are called ‘Covered Entities’. And they are as follows:

  • Disproportionate Share Hospitals (DSH)
  • Sole Community Hospitals
  • Rural Referral Centers
  • Critical Access Hospitals (CAH)
  • Children and Cancer hospitals that do not allow the medicare payment system.

At the same time, the hospitals or medical centers must be

  • Owned/ Run by local government or the state government
  • A public/private Non-profit corporation that has been given the government powers by local government
  • A private Non – profit corporation which has the license to treat low-income patients

The low-income individuals who are not eligible for any Medicaid or Medicare schemes can avail themselves of the 340B program.

Apart from the above-mentioned hospitals, the federal resources can be divided into the other categories of health care organizations. They are as follows:

  • Federally Qualified Health Centers
  • Federally Qualified Health Centers look-alikes
  • Native Hawaiian Clinics
  • Urban Indian Clinics
  • Ryan White CARE Program Grantees


Once the facility knows that it meets the eligibility criteria for the 340B program, can apply for the program online. This can happen during the first 2 weeks of every quarter. That is

  • January 1 to 15
  • April 1 to 15
  • July 1 to 15
  • October 1 to 15

Once it is approved, you can find your organization’s name in the OPA’s information system. The concessions and discounts on drugs shall be applicable from the 1st of next quarter from the one applied for.

John Norwood
John Norwood is best known as a technology journalist, currently at Ziddu where he focuses on tech startups, companies, and products.