Earlier this year, the Health Resources & Services Administration took a strong stance against drug giant Johnson & Johnson’s plan for a proposed 340B rebate model, but the fight over rebates is far from over. 340B Health President and CEO Maureen Testoni joins us to discuss how the company is taking the issue to federal court and how they are not the only drugmaker doing so.

J&J Sues HRSA Over Rebates

J&J is arguing in court that HRSA lacks the authority to block a 340B rebate model. Such a model would allow individual drug companies effectively to impose their own rules on 340B drug purchases. These rules would curtail the number of drugs a company would offer a 340B discount on and reduce the number of patients that would be deemed 340B-eligible.

Other Drugmakers Pushing Rebates

Bristol Myers Squibb and Eli Lilly also sued HRSA, claiming the agency does not have the authority to stop a rebate model. Sanofi has not yet filed suit but is saying it will impose its rebate scheme in early January. The Sanofi model raises significant concerns not just because of the imminent effective date but because it would impose far more stringent restrictions on 340B eligibility than HRSA ever has.

State Contract Pharmacy Laws Rack Up More Wins

In another 340B issue before the federal courts, state contract pharmacy protections continue obtaining key litigation wins. Several district courts and one appeals court have upheld state laws designed to protect covered entity access to 340B pricing through community and specialty contract pharmacies.

Resources:

1. Brief Your Leadership on Drugmaker Rebate Schemes
2. The Wall Street Journal: “The Economic Imperative of Protecting 340B”
3. Register for the 340B Coalition Winter Conference

What Does the GOP Trifecta Mean for 340B?

In January, Republicans will achieve what’s known as a governing trifecta – taking control of the executive branch combined with GOP majorities in both the U.S. House and Senate. How will this new dynamic affect the 340B world? We discuss what is ahead with McDermott+ vice presidents Rodney Whitlock, a former Republican legislative staffer, and Debbie Curtis, a former Democratic legislative staffer.

Capitol Hill Shakeups and New Faces

Several 340B champions are set to leave Congress through retirement or new appointments, including Reps. Elise Stefanik and Abigail Spanberger as well as Sens. Debbie Stabenow and Ben Cardin. But this provides an opportunity to speak to newly elected lawmakers to express the value of 340B and what it means for their constituents.

Preparing for 340B Oversight

The new Congress could bring oversight hearings and other opportunities for 340B critics to speak out. Although 340B has faced and surmounted challenges before, this will require getting back to core advocacy efforts designed to protect the program.

Trump’s Second Term

How the second Trump administration will fill key roles and the decisions they make on health policy issues could impact 340B. The implementation of Inflation Reduction Act drug pricing provisions also will affect 340B and could lead to discussions about additional changes to the program.

Resources:

1. Create or Update Your 340B Impact Profile
2. Read Our Analysis of J&J’s Legal Arguments for 340B Rebates
3. Lilly, Kalderos Press Federal Court for Ability To Impose Rebates

The focus of attention on cancer care most often goes to the curative treatments required to put cancer into remission, but what do cancer survivors need after that point to fully recover and lead their best possible lives? We discuss that question and how 340B can help answer it with guests Sarah Loschiavo and Ellen Morris-White, two nurse practitioners with UConn Health based in Farmington, Conn.

Survivorship Care at a Crucial Time

UConn Health’s Cancer Survivorship Program is led by advanced practice registered nurses who provide comprehensive care and support to cancer patients starting three to six months after their curative cancer treatments are complete. With the help of 340B funding, the multidisciplinary program is broad in scope, including referrals to meet cancer survivors’ physical, psychosocial, spiritual, and financial needs. The goal is to keep patients on the road to recovery and to continue screening for any cancer recurrence or secondary cancers that could occur.

340B Is Key To Covering Costs 

UConn Health covers the costs of its survivorship care, and low-income patients can receive additional financial assistance for their ongoing cancer therapies through this program. 340B funding is essential to making that happen. Over time, the program is expected to decrease health care costs by avoiding hospital readmissions and cancer recurrences. 

Building Out Best Practices

Evidence on survivorship care models is lacking, but UConn Health has worked on research that could provide some best practices for other institutions. Although there is no one-size-fits-all approach for hospitals, they can use elements of the nurse practitioner-led, interdisciplinary model to meet cancer patients’ needs months and even years after curative treatment. 

Resources: 

1. UConn Health Cancer Survivorship Program
2. Designing, Implementing, and Evaluating an Interprofessional Survivorship Model of Care in an Academic Cancer Center

The 340B drug pricing program is crucial for safety-net hospitals and other providers that care for patients in need, especially those whom traditionally have been underserved by the broader health system. We speak with Dr. Tony Jackson, assistant vice president for pharmacy services at Scripps Health in San Diego, for his views on why 340B is “all about health equity.”

340B Helps Serve the Underserved

Jackson stresses the variety of services and support that 340B funding enables at Scripps Health. Because of 340B, Scripps can serve large populations of patients in the area who are homeless, lack health coverage, and are dealing with higher rates of chronic illness and disease. It does so in part through partnerships with community health centers and other community groups on outreach to those populations. 

Restrictions to 340B Threaten Patient Care

340B savings help support vital Scripps services that include emergency department care, access to specialists, discharge and maintenance medications, and community health benefits such as disease screenings. Jackson notes that drug company restrictions on access to those savings threaten such services and risk creating health care deserts in the area.

Representation and Advocacy Matter

Jackson is part of the Association of Black Health-System Pharmacists (ABHP), which works to increase Black representation in the pharmacy field with the goal of improving underserved patients’ trust in pharmacists and access to needed care. He notes how ABHP leaders have advocated for 340B with the understanding of how important it is to the pursuit of health care equity.

Resources

1. 340B Health Equity Report 2023
2. Black Pharmacists Stand as Advocates in Support of 340B Access to Care
3. Senate Letter to HHS on Rebates

Within the past few weeks, drugmaker Johnson & Johnson went head-to-head with 340B hospitals and the federal government over the company’s plan to stop paying upfront 340B discounts on two of its top-selling drugs. 340B Health Senior Counsel Amanda Nagrotsky joins us to explain how that conflict played out.

HRSA Warns Johnson & Johnson of Strong Punitive Actions

In letters to J&J, the Health Resources & Services Administration (HRSA) warned the drugmaker that replacing 340B rebates with discounts only would be allowed if approved by the Health and Human Services (HHS) secretary. HRSA gave the company until the end of September to announce that it was going to walk away from its plan or face both civil monetary penalties and the termination of its pharmaceutical pricing agreement (PPA). Nagrotsky said the threat to end the PPA was unprecedented, noting that it would cause the company to lose access to Medicaid and Medicare Part B coverage for all its drugs.

Johnson & Johnson Backs Down Under Pressure

J&J announced at the end of September that it would walk back its plan to implement rebates in mid-October, bowing to pressure from federal health officials and a bipartisan group of nearly 200 members of Congress who opposed the J&J strategy. The company maintained that it disagreed with HRSA’s reasoning and noted that it was reserving all legal rights with respect to rebates. That stance indicates the company is likely to continue its push to implement rebates.

The Battle Against Rebates Continues

Despite the win for hospitals on the J&J rebate scheme, efforts from the drug industry to change the 340B discount structure continue. Drug industry consultant Kalderos is part of ongoing litigation in a federal court in Washington, D.C., over the right to impose rebates. HRSA’s references to the concept of HHS approval of rebate proposals also leaves open the door for companies to seek federal consent for such a model.

Resources

1. 340B Hospitals Prevail on J&J Rebate Plans, But Fight Is Not Over
2. Bipartisan U.S House Letter to HHS, Sept. 27 
3. HRSA Letter to Johnson & Johnson, Sept. 27
4. J&J Response to HRSA, Sept. 30

A renewed push by a drugmaker to fundamentally transform 340B has the potential to cause major problems for 340B hospitals if allowed to take effect. 340B Health President and CEO Maureen Testoni joins us to explain the controversial 340B rebate issue and to cover some of the other recent developments in the 340B world.

A Plan To Replace Upfront Discounts With Rebates

For years, drugmakers have been pushing unsuccessfully for approval to turn 340B from an upfront discount program into a back-end rebate program. But recently, Johnson & Johnson announced it would unilaterally proceed with plans to stop selling two of its drugs at the discounted price for certain hospitals. Maureen explains the reaction of the government, hospitals, and others and outlines the potential next steps in the advocacy against such a harmful change.

More Legislative Action on Capitol Hill

Recently, Sen. Peter Welch of Vermont introduced legislation to make access to 340B through contract pharmacies a very clear part of statute and to prohibit manufacturers from imposing conditions on 340B pricing. It is one of several 340B bills pending on Capitol Hill, which also include a potential Medicaid payment reporting requirement for 340B hospitals. Maureen notes that although Congress does not have much time left to legislate this year, it is possible 340B will be part of the action during a lame-duck session after the elections.

Court Action Continues on State 340B Laws

Although two federal appeals courts recently ruled that the 340B statute does not categorically prohibit drugmaker conditions on 340B pricing, several states have moved to impose their own such prohibitions. Drug companies are suing to block these laws, but so far courts have denied these attempts. Maureen notes that 340B Health and other organizations continue to file friend of the court briefs in support of these state laws.

Resources

1. HRSA Threatens Johnson & Johnson With Sanctions Over Rebate Plans

2. HRSA Letter to J&J 

The 340B drug pricing program is designed to give hospitals the flexibility to use their savings toward the types of patient care and support that their communities need the most. How does that work for hospitals that decide to use their access to 340B to provide the discounts directly to patients who cannot afford their drugs? Paul Orth, 340B program manager at University Health Kansas City Truman Medical Center, sits down with us to discuss how his health system’s direct drug savings program is helping both uninsured and underinsured patients.

How the program works

Orth says his system’s direct savings program is built into the system that prescribes medication electronically from its clinics and its hospitals’ electronic medical records system. When the prescriptions that generate from those visits are sent to a system pharmacy, 340B eligibility codes are attached that allows the pharmacy to know that they are eligible to receive the drugs at the 340B-discounted price plus a dispensing fee.

Underinsured patients also benefit

Orth says University Health describes its direct savings model as an uninsured program because that describes the key patient population that benefits from receiving the 340B price. But that assistance also is available for underinsured patients who otherwise would be expected to pay more in prescription drug copays than the 340B price. 

Drugmaker restrictions are a barrier

Orth says this program is the difference between patients receiving a needed medication and going without one, which prevents hospital readmissions and emergency department visits. But he also notes that drug company restrictions limiting 340B pricing to a single contract pharmacy are negatively affecting the program, ultimately adding another barrier for access to care. 

Resources:

1. 340B Health Urges HRSA To Block J&J Plan To Replace 340B Discounts With Rebates
2. J&J Implements 340B Rebate Model Despite HRSA Opposition
3. 340B Health Equity Report 2023

This marks the time of year when 340B hospitals complete the recertification process to maintain their eligibility for 340B. But why is this recertification needed, and what do hospitals need to know before undergoing recertification? 

Steven Miller, the vice president of pharmacy services for 340B Health, describes what is at stake when it comes to hospitals completing recertification every year. Failure to do so could take a hospital months to correct and cost it millions of dollars – resources that the hospital could be using towards services for patients who need help the most.

The key players

Miller says the hospital’s authorizing official (AO) and primary contact (PC) are two of the most important figures for recertification. These individuals will be key to verifying and submitting information to the government during the process, and there are important rules governing their roles and responsibilities.

Preparing for recertification

Miller says hospitals should have their “ducks in a row” and be ready to undergo recertification as soon as the period begins. This involves having the necessary staff involved, having required documentation on hand, and being prepared to respond quickly to any inquiries from the Health Resources & Services Administration (HRSA).

Hospital best practices

Miller has tips for hospitals that want to navigate the recertification process efficiently and accurately. This includes advice on ensuring all the information in the HRSA Office of Pharmacy Affairs Information System is correct, fixing any discrepancies that could lead to future audit findings, and documenting needed changes to make sure they take effect.

Resources:

1. 340B Health Registration and Recertification Resource
2. 340B Health Webinar Archive
3. 340B Health Equity Report 2023

Artificial intelligence is a hot topic in 2024. Discussions about AI in health care continue to grow, including about the potential for such technology to improve care and save lives. What role might AI play in the 340B world? We speak with WVU Medicine Enterprise 340B Program Coordinator Elizabeth Gibson to learn how one health system is exploring this potential.

What Can a 340B “Bot” Do?

Gibson’s team uses artificial intelligence to improve its 340B internal auditing processes. What they call “the bot” can streamline the process by pulling data from the health system’s electronic medical records system and automating the administrative tasks required to set up an audit. The bot also can make the process more effective by increasing the number of audited claims and flagging potential problem areas. She noted this makes the team more prepared for the data they must collect for external 340B audits as well.

Lessons Learned During Implementation

Gibson said installing the bot for 340B use was a very “trial and error” approach, though the team was able to make quick changes to fix any issues they encountered. She said one of the biggest growing pains of the AI-based system was the time needed to make the tool operational. She also notes the bot may be clunkier than a product they would have purchased through an outside vendor because it is designed to allow the team to customize and modify as needed.

Opening Eyes to the Benefits of Automation

Gibson said this new tool has led to her team re-evaluating other 340B processes that they can automate, even if that does not involve AI. WVU also is considering potential bots that will look specifically at Medicaid claims and help conduct retail audits. She urged health systems to consider the concept of automation more broadly than AI, bots, and machine learning, as collaborating with other departments that can share automation skills could help improve overall 340B processes.

We have released several episodes in recent months in which we have discussed federal and state legislative efforts on 340B. But what does it take to get 340B protections through a state legislature and to the governor’s desk? In this episode, we speak with Ryan Cross, vice president of governmental affairs with Franciscan Missionaries of Our Lady Health System, based in Baton Rouge, La. This system operates 10 hospitals in Louisiana and Mississippi. Both states recently enacted contract pharmacy protection laws. Ryan says there were three factors involved with getting these state protections over the legislative finish line:

Relationships — Ryan says the relationships 340B advocates formed with other hospitals, lawmakers, and public policy staff contributed to their successes at the state level. The first time to discuss 340B with these individuals cannot be when a bill is going up for consideration, much less when stakeholders are on defense and trying to explain the importance of 340B in the wake of legislation that would harm covered entities.

Messaging — Ryan explains how the messaging that resonated in the states during the 340B contract pharmacy debate focused on how big pharma is trying to take money away from not-for-profit hospitals and drive it to out-of-state shareholders. By emphasizing the variety of patient programs and support that are possible because of 340B without making it a referendum on the federal program at large, that case mostly sells itself.

Grassroots — Ryan notes that there are roughly 18,000 members of his health system across Louisiana and Mississippi. These are physicians, nurses, pharmacy techs, and other health care professionals with representatives that they can contact. Knowing when to deploy these grassroots supporters to make phone calls and send emails is important, because that can get attention and results when timed well.

Resources:

1. Missouri Becomes Eighth State To Enact Contract Pharmacy Protections