Do you feel anxious at the thought of driving in a roundabout? If so, you’re not alone. While most drivers’ get that ‘deer in the headlights’ look initially, studies have shown that after drivers use roundabouts, they like them. As a matter of fact after driving in roundabouts, the number of people who favor them, more than doubles.
A survey on drivers’ views of roundabouts before and after construction conducted by The Insurance Institute for Highway Safety, illustrates public opinion. Before construction, the number of drivers who were in favor of roundabouts was only 31 percent, and those strongly opposed was 41 percent. The reasons most cited for concern were fear of the unknown: people initially preferred traffic signals and stop signs to guide them. In follow-up surveys, done after the roundabout was installed and drivers had a chance to use them, those who favored roundabouts increased to 63 percent and those strongly opposed dropped to 15 percent.
You may question, why am I writing about roundabouts, and what do roundabouts have to do with the 340B program? I believe that there is an uncanny similarity between roundabouts and the 340B program. As I had written in an earlier blog post, the 340B program and the possibility of an audit, emit fear in many people. For most, it is fear of the unknown. The goal of my blog is to promote an appreciation of the program and to help you feel the same effect that drivers in the roundabout felt with experience. Also, I would like to help 340B users who are feeling anxious and confused in the nebulitic world of 340B, learn to better navigate the complexities, gain a better understanding of the many helpful tools, improve their perception, and favor the program overall.
Those participating in the 340B Government Drug Pricing Program can usually unite and relate to the changing landscape and challenging complexities we are facing. The benefits of participation of course outweigh the challenges, and within this blog post, I will share knowledge, and provide useful information to help guide you through the complex, and help you to route successfully through the program.
340B DRUG PRICING PROGRAM BASICS:
Health Resources and Services Administration (HRSA), is an agency of the U.S. Department of Health and Human Services. HRSA is the primary Federal agency for improving access to health care services for people who are uninsured, isolated or medically vulnerable. The Office of Pharmacy Affairs (OPA), the Office responsible for administering the 340B Program, is part of HRSA. The 340B Drug Pricing Program requires drug manufacturers to provide outpatient drugs to eligible health care organizations/covered entities at significantly reduced prices.
Per the HRSA website: http://www.hrsa.gov/opa/index.html
Once a covered equity is enrolled in the 340B Program and included in the covered entities database, it is the covered entity’s responsibility to inform wholesalers and manufacturers of enrollment in order to purchase drugs at the 340B discounted price.
Most covered entities choose one or more of the following implementation options:
• In-House Pharmacy,
• Contract Pharmacy Services,
• Provider/In-House Dispensing,
• Alternative Methods Demonstration Project.
Once a covered entity has registered and is approved to participate in the 340B Drug Pricing Program, again, it is the covered entity’s responsibility to notify drug manufacturers and wholesalers that it will now purchase outpatient drugs at 340B prices. The wholesalers and manufacturers verify the covered entity’s enrollment on the 340B database and must sell its drugs at or below the maximum price determined under the 340B statute. Per Apexus, savings can range from about 17% for Disproportionate Share Hospitals to 30% for other types of facilities.
To purchase drugs at the 340B price, covered entities must adhere to the following rulings:
• Prevent duplicate discounts: Manufacturers are not required to provide a discounted 340B price and a Medicaid drug rebate for the same drug. Covered entities must accurately report how they bill Medicaid drugs on the Medicaid Exclusion File;
• Prevent diversion to ineligible patients. Covered entities must not resell or otherwise transfer 340B drugs to ineligible patients;
• Maintain auditable records documenting compliance with 340B Program requirements. Covered entities are subject to audit by manufacturers or the federal government. See more about Program Integrity below. Any covered entity that fails to comply with 340B Program requirements may be liable to manufacturers for refunds of the discounts obtained;
• Keep 340B database information accurate and up to date. Some change requests may be submitted online;
• If applicable, register new outpatient facilities and contract pharmacies;
• Recertify eligibility every year; and
• Not participate in a group purchasing organization for covered outpatient drugs. (This requirement only applies to disproportionate share hospitals, free standing cancer hospitals, and children’s hospitals.)
A Safety Net Hospital for Pharmaceutical Access study found that 340B hospitals use program savings to help vulnerable patients by reducing the price of drugs for low-income patients, increasing patient access to pharmacy services, expanding the selection of drugs available to patients, enhancing pharmacy and other health care services, and serving more patients, especially those who are indigent or otherwise vulnerable. The vast majority of these hospitals say that if they did not have access to 340B discounts, their uninsured and underinsured patients would see higher drug costs.
340B Program Integrity
340B Drug Pricing Program covered entities must ensure program integrity and maintain accurate records documenting compliance with all 340B Program requirements.
Covered entities are subject to audit by manufacturers or the federal government. Failure to comply may make the 340B covered entity liable to manufacturers for refunds of discounts obtained. Learn more: Program Integrity
RESOURCES TO HELP YOU WADE THROUGH THE COMPLEXITIES OF THE 340B PROGRAM
To help you learn more about several resources that are extremely helpful as a novice or an experienced 340B participant, I have listed the following websites that I turn to for very credible information, as they provide the very basic program information, and help to assist and sort through the granular details.
THE HRSA WEBSITE:
The most influential source of helpful 340B program information that I can recommend, is the link to the Health Resource and Services Administration/ Office of Pharmacy Affairs website: http://www.hrsa.gov/opa/faqs/index.html .
This site offers very basic information about the 340B program. For example it delivers the intent of the program: The 340B Drug Pricing Program requires drug manufacturers to provide outpatient drugs to eligible health care organizations/covered entities at significantly reduced prices. It also outlines how this is done: The 340B Program enables covered entities to stretch scarce Federal resources as far as possible, reaching more eligible patients and providing more comprehensive services. And who the program applies to: Eligible health care organizations/covered entities are defined in statute and include HRSA-supported health centers and look-alikes, Ryan White clinics and State AIDS Drug Assistance programs, Medicare/Medicaid Disproportionate Share Hospitals, children’s hospitals, and other safety net providers. See the full list of eligible organizations/covered entities. The site also conveys the necessary steps and important dates relevant to participation: To participate in the 340B Program, eligible organizations/covered entities must register and be enrolled with the 340B program and comply with all 340B Program requirements. Once enrolled, covered entities are assigned a 340B identification number that vendors verify before allowing an organization to purchase 340B discounted drugs. New registrations are accepted October 1-15, January 1-15, April 1-15 and July 1-15.
The HRSA/OPA website also offers a plethora of more intricate information regarding the following:
THE APEXUS WEBSITE:
Another very helpful source of information that I use daily to aid in my own understanding as well as help our customers’ gain a more detailed understanding of the complexities of the program, is the Apexus website. https://www.340bpvp.com/controller.html
The 340B Prime Vendor Program (PVP) is managed by Apexus, through a contract awarded by Health Resources and Services Administration (HRSA), the federal government branch responsible for administering the 340B Drug Pricing Program. The primary goal of the 340B Prime Vendor Program is to improve access to affordable medications for covered entities and their patients.
In addition to the very important resource information illustrated below, Apexus provides up to date briefings on ever important regulatory updates, program changes and developments. This is evidenced by the most recent article that you can find on the Apexus website: “2014 May Be a Game Changer for the 340B Program”. Here is the link to the article: http://www.healthlawpolicymatters.com/2014/01/29/2014-may-be-a-game-changer-for-the-340b-drug-discount-program/ . The article brings our attention to (1) a first in terms of HRSA imposing sanctions on audited entities, (2) written arguments in a lawsuit over the rules governing 340B access to orphan drugs https://docs.340bpvp.com/documents/public/resourcecenter/Summary_Orphan_Drugs.pdf , (3) increased funding for HRSA oversight through the recently-passed Omnibus Budget Act and (4) HRSA’s planned publication of regulations in June, 2014 (the “Mega-reg”), that may have the greatest impact on 340B Program operations to date. HRSA is currently working to formalize existing program guidance through regulation, designed to cover a number of aspects of the 340B Program, and it indicates regulation currently under development will address the definition of an eligible patient, compliance requirements for contract pharmacy arrangements, hospital eligibility criteria, and eligibility of off-site facilities.
This article also indicates that HRSA audited approximately 50 covered entities during the unspecified audit period and identified adverse findings in close to two-thirds of those audits. The most common adverse findings involved either (i) drug diversion, defined as dispensing a 340B drug to a non-patient or in-patient; (ii) duplicate discounts, defined as billing the drug to Medicaid so that the drug was likely invoiced for Medicaid drug rebates; or (iii) database errors in listing of related entities or contract pharmacies. To Note: None of the customers with adverse findings were Talyst customers.
This article also points out, the Omnibus Budget Act, signed by President Obama and funding government activities through September 2014, more than doubled the budget for HRSA’s Office of Pharmacy Affairs from $4.4 million to $10.2 million. This increase is designated for program integrity efforts.
The Prime Vendor Program serves participants in three primary roles:
1. Negotiates sub-ceiling 340B pricing on branded and generic pharmaceuticals
2. Establishes distribution solutions and networks that improve access to affordable medications
3. Provides other value-added pharmacy related products and services to its participants
The Apexus team is focused on the following areas as they manage the 340B PVP in 2014:
• Increase value to PVP participants
• Improve participant satisfaction and engagement
• Improve internal operations and systems
• Meet the evolving needs of HRSA
• Continuously improve wholesaler, supplier and GPO relationships
Benefits of the Prime Vendor Program include:
• No cost to participate
• Leverages collective purchasing power of more than 18,000 PVP participants with over $5 billion in pharmacy purchases
• Offers steeper discounts since it is the only program with authority to offer total price protection to branded pharmaceutical manufacturers for outpatient covered drugs
• Allows access to a broad contract portfolio of sub-340B priced products with longer-term contracts to better manage formulary decisions and stabilize budget fluctuations
• Continue to use existing authorized distributor to access program’s product pricing
• Verification of Prime Vendor pricing and 340B PHS ceiling pricing from manufacturers via a secure Web site
• Compatible with disproportionate share hospitals designated GPO responsible for securing discounts in the inpatient setting
• Compatible with in-house or contract pharmacy
• Exclusive discounts on other pharmacy related products, supplies, and services
The principal instrument that draws me to the Apexus website daily is the section of Frequently Asked Questions (FAQ’s). This searchable tool enables users to gain knowledge of how Apexus communicates HRSA FAQs/clarifications, with the intention of improving program compliance. Additionally, I also recommend the tools available for entities to gather general 340B knowledge, or to promote 340B compliance.
THE SAFETY NET HOSPITALS FOR PHARMACUETICAL ACCESS (SNHPA) WEBSITE:
Per the website, Safety Net Hospitals for Pharmaceutical Access (SNHPA), is a 501(c)(6) nonprofit organization of close to 1,000 public and private nonprofit hospitals and health systems throughout the U.S. that participate in the Public Health Service 340B drug discount program. SNHPA was formed in 1993 to increase the affordability and accessibility of pharmaceutical care for the nation’s poor and underserved populations.
SNHPA’s membership consists of a broad spectrum of 340B hospitals, including academic medical centers, community hospitals, children’s hospitals, and rural facilities. SNHPA monitors, educates, and serves as an advocate on federal legislative and regulatory issues related to drug pricing and other pharmacy matters affecting safety-net providers. SNHPA is dedicated to educating its members and others about the 340B program and creating new opportunities for members to save on pharmaceuticals and improve access to pharmaceutical care. To Note: Talyst is a SNHPA Platinum Corporate Partner.
I often turn to the SNHPA website to learn more about current industry events, news stories making headlines, and I find that they make the complex, simple and easier to understand. http://www.snhpa.org/
SNHPA 340B Resources
Below you will find a number of resources relating to the 340B Drug Pricing Program. Please use the links provided to access the information. Please note that SNHPA members have more content available to them once logged in. If you would like more information about becoming a SNHPA member, please visit their Join SNHPA section.
• 340B Drug Pricing Program
• 340B Facts
• Why 340B Matters: Case Studies from the Field and Videos
• Compliance Resources (You must be a SNHPA member to access this page)
• Government Resource Center
• Implementation and Operations
• The 340B Coalition
• Other Resources
In closing, as you follow future blog postings, I will provide information to help you move toward Audit Preparedness. This will include but not be limited to facilitation of a mock 340B audit, creating a comprehensive audit program, establishing 340B policies and procedures, conducting self-audits, mitigating/responding to potential self-audit findings, and preparing internal 340B training. I will also share experiences gained while supporting customers during a HRSA audit.