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    Referral Management for Community Health Centers & 340B Covered Entities: par8o's Latest Frontier

    By Daniel Palestrant, MD • June 29, 2018

    Community Health Centers (CHCs) and other Health Center Program grantees, such as 340B Covered Entities, are a critical part of the US healthcare system, and about a year or so ago par8o found a way to build upon our referral management solution in a way that helps support these programs. We are immensely proud of this new application and could not be more happy to do our part in helping to ensure all Americans have access to adequate healthcare resources regardless of health insurance status or income level. In this post, we'll talk about why CHCs are critical to our country's healthcare system, the HRSA 340B Drug Pricing Program, and how par8o's latest solution fits in.

    First, a word on terminology: Health Centers is the official umbrella term for the range of organizations that primarily serve underserved populations. Community Health Centers (CHCs) is commonly thought of as a subset of Health Center grantees that serve a general (as opposed to specific) population. In this post, we will use both terms, since much of the data available references Health Centers, and we have seen our platform gain traction specifically with CHCs or Federally Qualified Health Centers (FQHCs).

    Health Centers play a critical role in our country by providing care for populations typically underserved by the traditional healthcare establishment. Underserved should not be confused with small, however; Health Centers can have hundreds of providers and clinics.

    In addition, the role these providers and organizations play in our health care system is increasingly important:




    • Health centers have also shown above-average patient care metrics, such as high rates of screenings for those patients who need them, fewer low-birth weight babies, and better rates of diabetes and blood pressure control than the national average.
    • All of this is done in a way that’s highly cost effective relative to other sites of care.

    CHCs are at the Center of Primary Care

    There are specific features that make referral management critical for health centers. By definition, CHCs serve as the primary care provider for their patient populations, which means that they refer out most, if not all of their specialist care. Ensuring those referrals are responded to and patients attend referral appointments is something made all the more difficult given the unique challenges of these patient populations, such as transportation issues or living in rural areas where clinics may be hours away, and the fact that many of them are underinsured or uninsured.

    In addition to being an essential element of patient-centered primary care, referral tracking is required by key accrediting organizations. The NCQA PCMH accreditation includes “Referral tracking and Follow-Up” as a MUST PASS element. The Joint Commission also has requirements that the clinic “support continuity, coordinate care, and maintain complete records”.

    Referral Management for CHCs in the 340B Program: A Game Changer

    A quick lesson on the 340B program: Given that CHCs serve populations that lack health insurance, part of what keeps CHCs in operation is HRSA's 340B program. In short, this program requires pharmaceutical manufacturers to provide front-end discounts on covered outpatient drugs purchased by healthcare organizations called “covered entities,” that serve the nation’s most vulnerable patient populations. These covered entities include CHCs, hemophilia treatment centers, AIDS drug assistance programs, and public and nonprofit hospitals that serve a high number of Medicaid patients. The 340B program allows them to purchase drugs at discounted rates for low-income, uninsured, and under-insured patients.

    So how does par8o fit with CHCs and the 340B program? Well, it turns out that the current regulations stipulate that any prescriptions generated as a direct result of a referral can also count towards 340B savings provided certain conditions are met, which referral management software is uniquely suited to do. 

    Indeed, given the fact that specialist prescriptions tend to be much more costly than PCP prescriptions, the cost savings from referral prescriptions can be valuable. Par8o’s 340B Referral Capture solution builds upon our success providing Referral Management Systems (RMS) to large health care systems such as Dignity, Adventist, and Mount Sinai Health System in order to help CHCs capture greater 340B savings and, as importantly, help them "close the clinical loop" on patient care.