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    Specialty Contract Pharmacies, 340B Policy Change, and Compliance: 3 Summer 340B Coalition Conference Observations

    By Hannah Drake • July 20, 2018

    Last week, we attended the 340B Summer Coalition Conference in Washington, DC and wanted to share our top three observations from conversing with attendees - namely, a continued and growing interest in contracting with specialty pharmacies from CEs to increase access to drugs and provide better overall care for patients; how attendees reacted to Secretary Azar's keynote speech; and of course - compliance.

    Covered entities such as Community Health Centers (CHCs) and Federally Qualified Health Centers (FQHCs) gain several benefits by contracting with specialty pharmacies, primarily in being able to provide their patients with access to drugs they need and provide more comprehensive care that leads to better outcomes. Access challenges can be due to rural locations or manufacturer network restrictions per survey results published by 340B Health in July of 2017:

    Second, Secretary Azar's keynote speech was of concern for some CEs we spoke to, particularly on the DSH side where Azar hinted at cuts to 340B reimbursements. However, most CHCs seemed fairly confident that with proper program management their 340B programs will remain less affected.

    Azar’s key points:

    • “Be prepared for change. . .we are examining whether we need to disrupt the entire system of rebates, which drives list prices ever higher while patients keep paying more,” he said, pointing out recent pharmaceutical price hikes. “Eliminating rebates within the Medicare program, pushing the system toward fixed-price discounts, is well within our administrative powers.”
    • Regarding 340B specifically, Azar said two kinds of reforms are needed. One involves more transparency about how discounts are being used, and 1 involves reforms “to reduce the gap between discounted prices and the reimbursement provided, particularly by government programs.
    • The new HHS plan states that 340B hospitals can retain savings from the drug discounts only if they provide a threshold level of charity care. “The new payment level is still above the average price actually paid by 340B entities, but it is closer to reality,” Azar said.
    • Rural sole community hospitals, certain cancer hospitals, and children’s hospitals, however, are exempt from this reform.

    After the conference, more news came out about proposed cuts to Medicare Part B for 340B hospital outpatient facilities offsite.

    Lastly, attendees who went to the Track Two Policy and Compliance sessions reported that participants and speakers spoke of the importance of documentation when including prescriptions resulting from referrals for consult, which is mentioned in the second part of the patient definition.

    In order to be compliant with HRSA's patient definition, the CHC must have all of the following documentation on file at the registered site to indicate that the CE oversees the patient’s care:

    • Documentation of the patient encounter at the CE eligible site
    • Documentation of the specialist referral in the patient’s health record at CE eligible site
    • Documentation from the specialist that indicates 1) healthcare service was provided and 2) medications were prescribed

    par8o's 340B Referral Capture is a technology-enabled service that helps covered entities satisfy HRSA’s compliance guidelines and include prescriptions resulting from patient referrals in their 340B programs, while helping them provide more comprehensive patient care which leads to better outcomes.

    We work with data from your EHR/EMR, your TPA and your contract pharmacies to identify which specialist providers to contact for consult notes, then alert you when we’ve “closed the loop” for your patients who have been referred.

    For more information, see the following references:


    About the author: Hannah is par8o's Director of Marketing.

    340B Program Referrals Whitepaper