340B Program

Overview

The 340B Drug Pricing Program is a critical federal initiative that allows hospitals and other covered entities serving a significant portion of low-income or uninsured patients to purchase outpatient drugs at discounted prices.

The program was designed to help safety-net providers stretch scarce resources and reinvest savings into services that improve access to care for vulnerable populations.

By participating in the 340B program, HRRMC can reduce drug costs, which allows them to:

• Expand Services: Offer a wider range of services to our patients.
• Improve Access: Provide care to a greater number of patients, including those who may be under- or un-insured.
• Enhance Care: Improve the quality of care provided through access to more affordable medications.

As a Critical Access Hospital, HRRMC qualifies for participation, which directly supports our mission to serve rural and underserved populations. 

Financial Benefits

Drug Cost Savings and Margin Improvement 
Through the 340B program, HRRMC purchases eligible outpatient medications at discounts ranging from 12% to 75% or more below market rates. This reduces the cost of goods sold for pharmacy operations and enhances overall operating margin, particularly in high-cost drug categories like oncology, neurology, and specialty infusions.

Contract Pharmacy Revenue 
HRRMC’s participation in the 340B program supports strategic partnerships with local retail pharmacies via contract pharmacy arrangements. These relationships generate additional program revenue through shared savings models, which HRRMC reinvests into community health initiatives and offsetting uncompensated care.

Stabilization of Rural Access to Care 
Savings from the 340B program directly support HRRMC’s ability to maintain essential but often under-reimbursed services, such as behavioral health, OB/GYN, and chronic disease management. Without 340B funds, these services may operate at a financial loss or face contraction or curtailment—disproportionately affecting low-income and rural patients.