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The 340B Drug Pricing Program: The Basics
Paul ShankHealth & Human Services Consultant, Health Resources and Services AdministrationHealthcare Systems Bureau, Office of Pharmacy AffairsNorth Carolina Hospital AssociationAugust 26, 2010
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Learning Objectives
Intent of the program
1
340B Pricing determination
2
Entity eligibility
3
Entity enrollment procedure
4Program
requirements and
prohibitions
5
Program guidance and policy
6
Patient eligibility
determination
7
Drug delivery options
8
Available resources
9
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Intent of the 340B Program
Patients340B Eligible Entities
Safety net providers
SAVINGS
Improve financial stability
Stretch dollars to
serve vulnerable patients
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The 340B Price
Drug Manufacturers
The 340B price is actually a “ceiling” price
25-50% of the average wholesale
price
DRUG PRICING PROGRAM
340B
Can offer sub-ceiling prices
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340B Entity Eligibility
The eligibility to
purchase at the 340B
price belongs only to
the entities
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340B Enrollment Procedure
DEADLINES
participation begins 1 month after the enrollment deadline
FIND THE FORM
COMPLETE THE FORM
http://www.hrsa.gov/opa/legalresources.htm
Click on “Introduction to 340B”
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340B Statute Requirements and Prohibitions
Audit Resell/Transfer
Prohibition
Duplicate Discount
Prohibition
Prime Vendor DisproportionateShare Hospital
GPO Exclusion
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340B Regulation and Policy
Federal Register Notice publication
www.hrsa.gov/opa/federalregister.htm
OFFICE OFPHARMACY AFFAIRS
Definition of a Patient
entity has established relationship & maintains records of care
1
3 patient receives health care consistent with range of services from the covered entity
2 patient receives health care services from health care professional employed/contracted with entity
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CAH Pre-registration Checklist
Step 1. Verify EligibilityStep 2. Identify 340B eligible out-patient settings and
services where 340B drugs will/may be used. Step 3. Evaluate medication use trends for all 340B eligible
out-patient settings to determine financial impact.Step 4. Determine if 340B medications will be used for
Medicaid patients.Step 5. Consider pharmacy service model and operational
systems.Step 6. Consider 340B PVP participation by visiting:
https://www.340bpvp.com/public/Step 7. Complete 340B Registration Forms found at
https://opanet.hrsa.gov/OPA/Registration/RegistrationMain.aspx Step 8. Request Free Technical Assistance for
implementation!Contact PSSC with any questions (1-800-628-6297 or
9
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340B Implementation Options
340B Eligible Entities
Alternative Methods Demonstration Projects
www.hrsa.gov/opa/alternativemethods.htm
OFFICE OFPHARMACY AFFAIRS
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Integrity
Integrity Resource:
Develops innovative pharmacy
service models and supports
technical assistance
Serves as Federal resource
for pharmacy practice
Administers 340B program
• Access to affordable drugs
• Application of “best practices”
Office of Pharmacy Affairs (OPA)
• Efficient pharmacy management
• Systems to improve patient outcome
Importance of Comprehensive Pharmacy Services
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Access Resource:
Helps eligible entities,
implement and optimize the
340B program
Providesinformation resources,
policy analysis &education
Access
Pharmacy Services Support Center (PSSC)
• Call Center
• Web Site
• Outreach Program
• Pharmacy Technical Assistance Program
Operates
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Value Resource:
Offers value added products
and services
Offered at no cost to entity
Negotiates sub-ceiling prices
Helps with access to drug
distribution solutions
Value
Prime Vendor Program (PVP)
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340B & Medicaid: Avoiding Duplicate Discounts
Duplicate Discounts on 340B Drugs
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Duplicate Discounts on 340B Drugs
When does a duplicate discount occur?
Purchased with an up-front 340B discount
Credited with a back-end transaction Medicaid rebate
And
A duplicate discount occurs when the same drug is:
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340B EnrollmentForm
A 340B covered entity is required to indicate on the 340B Enrollment Form if it intends to bill Medicaid for Drugs purchased at 340B prices.
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Billing Medicaid
• “If a drug is purchase by or on behalf of a Medicaid beneficiary, the amount billed may not exceed the entity’s actual acquisition cost for the drug, as charged by the manufacturer at a price consistent with the Veterans Health Care Act of 1992, plus a reasonable dispensing fee established by the State Medicaid agency.”
– ftp//ftp.hrsa.gov/bphc/pdf/opa/FR05131994.pdf, pg. 25112
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Time for a Poll!
Do you currently have an outpatient/retail pharmacy?
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An Overview
•The desire to increase patient access to affordable medications.
•Entity contracts with one pharmacy per site.•Entity purchases and owns the medications.•The contract pharmacy provides
professional, administrative, and clerical services.
•Detailed receiving/dispensing records.•Diversion prevention tracking system.
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Implementation
•Form a Pharmacy Project Team.
•Establish Project mission and philosophy.
•Complete 340B Program application.
•Complete pharmacy needs assessment.
–Should you consider an outside pharmacy management vendor?
•Evaluate potential contract pharmacies.
–RFP if needed
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Time for a Poll!
Do you have space, expertise, and resources to build a retail pharmacy in your facility?
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Implementation: Evaluating the Pharmacy
• Consider the importance of comprehensive pharmacy services as an integral component of primary health care.
• Comprehensive pharmacy services include patient access to affordable pharmaceuticals, application of "best practices" and efficient pharmacy management and the application of systems that improve patient outcomes through safe and effective medication use.
• How will your contract pharmacy meet your needs for comprehensive pharmacy services?
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Time for a Poll!
Do you have a pharmacy in your area that could be contracted to dispense 340B drugs?
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Implementation
•Select a wholesaler.
•Sign Prime Vendor Program agreement.
•Develop an audit plan.
•Develop a formulary system.
•Develop a Policy and Procedures Manual.
•Choose pharmacy, negotiate contract, submit the Self-certification Form. (ftp://ftp.hrsa.gov/bphc/pdf/opa/CPSelfCert.pdf)
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“The Flow”Entity Wholesaler Contract Pharmacy Patient
Money Flow
Collects:- Payments collected by pharmacy
Collects:- Money from entity
Collects:- A per prescription dispensing fee from entity- Patient payments- 3rd party reimbursement on behalf of entity
Pays:- Wholesaler for drugs-Contract pharmacy a per prescription dispensing fee-Admin fees as negotiated
Pays:- Collections due to the entity
Pays:- Pharmacy amount due for prescription as determined by entity
Drug Flow
- Opens account with wholesaler as a bill to ship to arrangement
- Delivers drugs to contract pharmacy
- Dispenses drugs to patients- Manages and stores drug inventory owned by entity- Often orders drugs on entity’s behalf
- Receives drugs from contract pharmacy
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The Patient Safety & Clinical Pharmacy ServicesCollaborative (PSPC) 2.0
• The mission of this Collaborative is to advance the delivery of world class care by spreading the integration of clinical pharmacy services and patient safety principles to improve health outcomes in safety-net populations.
• HRSA invites you to form a team with other health care organizations in your community to take part in this exciting and unprecedented opportunity!
• The PSPC Participation Package is NOW available at www.hrsa.gov/patientsafety.
• Don’t delay, the deadline to submit a completed Participation Packages is July 31, 2009!
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What if?
•What if we would like to have more than one contract pharmacy per site?
•What if we have an in-house pharmacy that we would like to supplement?
•What if…..?
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Medicaid, Medicare & Third-Party Payers
How does 340B work with these various payers?
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Time for a Poll!
What is your OUTPATIENT Medicaid volume?
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Time for a Poll!
What is your Medicaid MCO volume for Medicaid patients?
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Time for a Poll!
What is your OUTPATIENT Medicare volume?
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Help!
Health Resources and Services Administration Pharmacy Services Support Center at
American Pharmacists Association
PSSC Call Center: (202) 429-7518
Or(800) 628-6297
Email: [email protected]