Office of Pharmacy Affairs 340B Drug Pricing Program Bradford R. Lang JD, MPH Public Health Analyst US Dept. of Health and Human Services Health Resources and Services Administration Office of Pharmacy Affairs

Learning Objectives Describe HRSA’s Office of Pharmacy Affairs’ (OPA) mission & goals List the entity types that utilize the 340B Drug Pricing Program Describe the enrollment procedure List requirements & prohibitions of the 340B Drug Pricing Program

Office of Pharmacy Affairs Mission: Promote access to clinically and costeffective pharmacy services 340B/ Prime Vendor Program Patient Safety and Clinical Pharmacy Services Collaborative

Program Administration Three Legs of the OPA/340B Program –Federal Team –Pharmacy Services Support Center (PSSC/ PharmTA) –340B Prime Vendor Program (PVP) OPA/340B Program PSSC PVP FEDS

What is the 340B Drug Pricing Program? Section 340B of the Public Health Service Act Provides discounts on outpatient drugs to certain safety-net covered entities Covered drugs are only for covered entity patients Manufacturers that participate in Medicaid must sign a Pharmaceutical Pricing Agreement (PPA) that obligates them to participate in the 340B program

HRSA Pharmacy Programs Pharmacy services in HRSA programs & safety-net partners are growing rapidly > $6,000,000, B purchases

7 340B Eligible Entities Federally Qualified Health Centers (FQHC) Comprehensive Hemophilia Treatment Centers Ryan White Programs (Parts A, B, C, D) Sexually Transmitted Disease/Tuberculosis Programs (STD/TB) Title X Family Planning Clinics Urban / 638 Tribal Programs Federally Qualified Health Center Look-Alikes (FQHC-LA) Disproportionate Share Hospitals (DSH) Children’s Hospitals – NEW September 2009

New Entities in Health Care Reform

Growth of Section 340B Covered Entity Sites

10 Program Benefits Average savings of 25-50% on outpatient drug purchases for 340B covered entities Savings may be used to: –Reduce price of pharmaceuticals for patients –Expand drug formularies –Expand services offered to patients

Program Prohibitions Diversion –Drug provided to a non-patient –Drug dispensed in an area of a larger facility that is not included in the defined covered entity (e.g. an inpatient service, a non-covered clinic) –Non-covered services Duplicate Discounts –340B Discount + Medicaid Rebate on same drug –Covered Entities must report Medicaid billing status to OPA

Patient Definition Established relationship between covered entity and individual (maintenance of the medical record) Responsibility for individual’s health care remains with covered entity – not just provider of low-cost medication Individual receives health care service or range of services from the covered entity consistent with grant funding

Patient Definition exemptions Disproportionate Share Hospitals are exempt from last requirement since they do not receive grant funding, however, only integral parts of the hospital may participate ADAPs are exempt; however, the State establishes their own eligibility criteria for identifying who is a “patient”

Federal Register Notice Pending Definition of Patient –72 FR 1543 –Clarifies previous FR Notice of October 1996 –Provides specific guidance and examples –A clear and enforceable definition to help ensure against diversion and support 340B program integrity

Program Requirements Auditable Records –Covered Entities must maintain auditable records that demonstrate compliance with all Program requirements. –Subject to audit by government or the manufacturer. Updating entity records –Covered Entities have an ongoing responsibility to notify OPA of any change in eligibility. –Covered Entities should also notify OPA of any updates in their information.

Enrollment & Participation There are 3 suggested steps for 340B participation: –determine eligibility –complete enrollment –utilize resources

340B Enrollment To participate, eligible providers must enroll in the 340B program: Complete forms Submit forms to OPA DEADLINES- 1 month before the start of the quarter

Eligibility Requirements for Disproportionate Share Hospitals (DSH) DSH Adjustment Percentage >11.75% for most recent cost reporting period Ownership: –is owned or operated by a unit of State or local government –public or private non-profit corporation which is formally granted governmental powers by a unit of State or local government –a private non-profit hospital which has a contract with a State or local government Non-participation in GPO for Outpatient Drugs

New Entities in Health Care Reform

340B Program Registration Form for DSH

24 340B Delivery Options 340B Eligible Entities Source: Dr. Barbara Brice, consultant, PSSC

Contract Pharmacy Services The Covered Entity purchases the drug, but “ship to - bill to” procedure may be used. The Covered Entity retains legal title to all drugs purchased under 340B. The Covered Entity must pay for all 340B drugs. The contract pharmacy is subject to audits – diversion and duplicate discount

FRN on Contract Pharmacy Effective April 5, 2010 Contract Pharmacy –72 FR 1540 –Updates previous FR Notice of August,1996 –Builds upon experience with Demonstration Projects –Incorporates multiple contract pharmacies as standard option –Visit for details

340B Database Who can use the database?  Manufacturers, wholesalers, contract pharmacies, covered entities, the public How can we access the database?  Go to our website at

OPA Website:

How Do I Contact the OPA Team? OPA PSSC PVP