340B Drug Pricing Program

Scripps Mercy Hospitals participate in reduced drug pricing program

Scripps Mercy Hospital in San Diego and Chula Vista participate in the 340B Drug Pricing Program. Designated as a disproportionate share hospital (DSH), Scripps Mercy is eligible to purchase outpatient drugs at a reduced price, allowing it to stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.

The 340B Drug Pricing Program is a vital lifeline for safety-net providers — such as those at Scripps Mercy Hospital — who provide critical health services in our communities. The program is narrowly tailored to reach only hospitals that provide a high level of services to low-income individuals or that serve isolated rural communities. Savings from the 340B program help hospitals meet the healthcare needs of underserved patients across the country.

How 340B supports Scripps Mercy Hospital and our community

Scripps Mercy Hospital contributed $199,690,114 to community benefits for Fiscal Year 2022, including:

  • $11,316,964 in charity care
  • $91,282,553 in Medi-Cal and other means-tested government programs
  • $69,986,815 in Medicare shortfall
  • $1,869,283 in bad debt 
  • $3,157,043 in subsidized health services

We use our 340B savings to keep our costs down so we can keep our doors open. Scripps Mercy is designated a DSH hospital, providing care to a large number of patients who either lack health insurance or are covered through a government subsidy program. Our payer mix is:

• 27.2% Medicare

• 22.9% Medi-Cal

• 11.3% commercially insured patients

• 20% of patients have another payment source, including self-pay, CMS, or charity care

One way Scripps Mercy is able to provide care to some of our most needy patients is through in-lieu of funds. In-lieu of funds are used for unfunded or underfunded patients and their post-discharge needs. Funds are used for board and care, skilled nursing facilities, long-term acute care and home health. In addition, funds are also used for medications, equipment and transportation services. $3,611,879 was spent on in-lieu of funds in FY2022.

About Scripps Mercy Hospitals

• 655 licensed beds

• 4,322 employees

• San Diego’s longest established and only Catholic medical center

• Provides health care services for 22.3% of the inpatient population living within the hospital’s central service area

• 36.53% DSH hospital