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Get to Know 340B
The 340B Drug Pricing Program is a key element of community health centers' ability to expand access to affordable medications and other services to patients. The blog post series on 340B will provide an introduction to the program, describe how community health centers utilize the program to benefit patients, and address recent trends that undermine the program's success and sustainability.
What is 340B?
The 340B Drug Pricing Program is a federal program, established in 1992, which allows certain providers to purchase outpatient medications at a discount. The savings accrued from the program are reinvested into patient care.
What is the purpose of the program?
Congress established the 340B program under the Public Health Service Act, to ensure eligible providers could “stretch scarce Federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.” The savings generated from the program allow 340B providers, to increase access to care by offering affordable medications and expanding services to patients.[1]
Do community health centers participate in 340B?
Yes. Federally Qualified Health Centers (FQHCs), also known as community health centers, are considered eligible for the program.
Who else can participate in the 340B program?
Only certain health care providers are eligible to participate in the 340B program. Eligible providers must be non-profit health care organizations and be supported by specific types of federal funding or have a certain designation. In addition to FQHCs, other safety net or specialized providers are eligible, including certain hospitals, specialized clinics, Ryan White HIV/AIDS clinics.[2] Read a full list of 340B covered entities here>>>
How does a Community Health Center become a covered entity?
The Health Resources and Services Administration (HRSA) is the agency responsible for overseeing the community health center program. HRSA's Office of Pharmacy Affairs administers the 340B program. Drug manufacturers enter into agreements with HRSA and community health centers must register with HRSA to become an approved ‘covered entity.' Distributors receive drugs from manufacturers and health centers can then purchase discounted drugs from the distributors. The drugs are then shipped to health centers, where they are provided to patients.[3]
[1] National Association of Community Health Centers. (2018). NACHC 340B Manual for Health Centers, Second Edition.
[2] Ibid.
[3] 340B Drug Pricing Program: What Is it, How Does It Work? (2017). Retrieved from https://putnamridge.com/340b-drug-pricing-program-work/