The 340B Drug Pricing Program was enacted by Congress in 1992 as part of the Veterans HealthCare Act. It requires that drug manufacturers who participate in Medicaid provide significant discounts to eligible hospitals on all eligible outpatient drugs. Eligibility Hospitals and clinics must qualify under one or more of the qualification categories in order to participate in the program.
An entity eligible for more than one category must choose under which category they are participating at the time of registration. The primary eligibility categories are Disproportionate Share Hospitals (DSH). These provide at least 11.75% of their care to indigent patients. This is determined by their Medicare cost report.
For more information, see Introduction to 340B (pdf).