Most hospitals are nonprofit and justify their exemption from taxation with community service and charity care. But the Trump administration could require some of them to do more to help the poor, and the hospitals that are in the cross-hairs are those benefiting from an obscure drug discount program known as 340B.
The 340B program requires pharmaceutical manufactures to sell drugs at steep discounts to certain hospitals serving larger proportions of low-income and vulnerable people, such as children or cancer patients. The participating hospitals may charge insurers and public programs like Medicare and Medicaid more for those drugs than they paid for them and keep the difference.
