The Trump administration proposed a new rule on Thursday that it says could save Medicare patients $1.1 billion next year. 

The rule would prevent hospitals from charging markups on discounted drugs, according to the Associated Press, and it would apply to hospitals that serve low-income patients under Medicare's 340B program. 

The program allows hospitals to buy outpatient prescription drugs at discounted prices, but often, the hospitals bill insurers at rates that exceed those costs. Hospitals then keep the difference. 

Under the proposed rule, the Centers for Medicare & Medicaid Services would impose a formula for what hospitals participating in the program can get reimbursed, which would lower costs to patients.