The 340B Drug Pricing Program: The Basics
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1 The 340B Drug Pricing Program: The Basics Paul Shank, MBA Health & Human Services Consultant, Health Resources and Services Administration Healthcare Systems Bureau, Office of Pharmacy Affairs July 14,
2 340B Program Created by Congress in 1992 to lower the drug costs of safety net providers Legislative intent: to help safety net providers stretch their scarce tax dollars in order to provide more services and serve more vulnerable patients Administered by Office of Pharmacy Affairs (OPA) within the Health Resources and Services Administration (HRSA) Requires drug manufacturers participating in Medicaid and/or Medicare Part B to participate in the 340B Program. SNHPA NRHA 2
3 Registered Entities OPA maintains databases of participating covered entity sites, manufacturers & contract pharmacies As of June 2010: 14,600 covered entities 870 manufacturers 3900 pharmacies Over 800 hospitals currently enrolled Some rural hospitals already participating as DSH s SNHPA NRHA 3
4 The 340B Price The 340B price is actually a ceiling price 340B DRUG PRICING PROGRAM 25-50% of the average wholesale price Can offer sub-ceiling prices Drug Manufacturers 4
5 340B Entity Eligibility The eligibility to purchase at the 340B price belongs only to the entities 5
6 340B Entity Eligibility Comprehensive hemophilia diagnostic treatment centers Native Hawaiian health centers Urban Indian organizations Certified tuberculosis clinics Certain disproportionate share hospitals (>11.75%) Certified sexually transmitted disease clinics Consolidated Health Centers Federally Qualified Health Center, or FQHC look-alikes Family planning (Title X) Ryan White Care Act (Parts A, B, C, D) grantees Black lung clinics Children s Hospitals 6
7 New Entities Now eligible: Free-standing children s hospitals & freestanding cancer hospitals that have Medicare DSH adjustment > 11.75% Sole community hospitals and rural referral centers that have Medicare DSH adjustment 8% Critical access hospitals (no DSH threshold) SNHPA NRHA
8 340B Statute Requirements and Prohibitions. 340B Legislation Program Components Price Formula Eligible Entities Requirements & Prohibitions 8
9 340B Statute Requirements and Prohibitions. Prime Vendor Audit Resell/ Transfer Prohibition Duplicate Discount Prohibition Disproportionate Share Hospital GPO Exclusion 9
10 340B Regulation and Policy. Interpreting the legislation and implementing the 340B Program may at times be a challenge OFFICE OF PHARMACY AFFAIRS Federal Register Notice publication 10
11 340B Program Resources. Integrity Access Value 11
12 Integrity Resource: Office of Pharmacy Affairs (OPA) Administers 340B program Develops innovative pharmacy service models and supports technical assistance Serves as Federal resource for pharmacy practice Integrity Importance of Comprehensive Pharmacy Services Access to affordable drugs Application of best practices Efficient pharmacy management Systems to improve patient outcome 12
13 Access Resource: Pharmacy Services Support Center (PSSC) Helps eligible entities, implement and optimize the 340B program Provides information resources, policy analysis & education Access Operates Call Center Web Site Outreach Program Pharmacy Technical Assistance Program 13
14 Value Resource: Prime Vendor Program (PVP) Negotiates subceiling prices Helps with access to drug distribution solutions Offers value added products and services Offered at no cost to entity Value 14
15 Staying connected to the 340B World ASHP meetings June and December APHA meeting March 340B Coalition meetings February and July APhA Pharmacy Today Access For All Network at various entity specific meetings (NACHC, NAPH, Primary Care Associations, etc.) SNHPA HRSA PSSC Prime Vendor Program The Monitor List Serves Others 15
16 Contacts: OFFICE OF PHARMACY AFFAIRS Pharmacy Services Support Center pssc.aphanet.org Prime Vendor Program
17 Thank You! 17
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