340B Insight

Hospitals throughout the U.S. use their 340B savings in innovative ways to care for their patients in need. In some cases, they can take that care outside the walls of the hospital to meet patients where they learn, live, and play. We speak with Heather Armstrong with Comanche County Medical Center in central Texas to tell us how her health system invests 340B savings into innovative approaches to community care.

Improving student health on campus

Since the end of 2022, Comanche County Medical Center has been operating a school campus-based program that pairs onsite diagnostic equipment with telehealth visits to keep students and staff healthy without requiring families to miss school and work. The program has decreased absenteeism and enabled faster recoveries for the patients it serves.

Putting community care on wheels

Comanche County Medical Center has a fully equipped mobile van clinic that it can deploy wherever the community needs care. By bringing the clinic to food drives, sporting events, and areas affected by wildfires, the center has been able to provide many more residents with preventive services, medications, and other vital care that they otherwise would not have accessed.

Expanding the reach through pharmacy partners

The community pharmacies that Comanche County Medical Center partners with, combined with prescription delivery services, has greatly expanded the numbers of patients whom the center can connect to needed prescription drugs. But drugmaker restrictions on contract pharmacies has had substantial negative impacts on that access and has affected the center’s plans for health services growth.

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources:

1. Court-Backed Arkansas Contract Pharmacy Law Prompts Enforcement Action, More Drugmaker Retreats

340B savings can help hospitals and other covered entities better serve patients and improve their health outcomes. But how can these entities make the best use of 340B funds for their institutions? We sat down with Matt Webber, director of pharmacy business at Novant Health based in North Carolina, to learn more.

340B optimization strategies
 
One way that Novant Health optimized its 340B program was through a multidisciplinary team that includes data analysts and auditors. Matt says that while this team prioritizes compliance above all else, it also can focus on technology and data to increase 340B efficiency and to find opportunities to increase patient access to the drugs and care they need.
 
How 340B optimization helps patients

Novant Health was able to use their 340B optimization team to find cases in which patients receive a prescription from the hospital but use a non-contracted pharmacy to fill their medication. The team found out where this was occurring and used the information to expand their contract pharmacy footprint and better meet patients’ needs where they are.

The complexity of optimizing

Matt says health systems can encounter numerous systemic challenges in pursuing 340B optimization, including navigating individuals’ choice, rising drug costs for patients, and complex reimbursement issues. Still, Novant’s optimization efforts are paying off for patients by measurably improving their health outcomes and connecting them to more affordable drugs and care.

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources:

1. Mississippi Bans Drugmakers’ Contract Pharmacy Restrictions
2. HRSA Issues Final Rule on Changes to Administrative Dispute Resolution (ADR) Process

The 340B community has seen major activity on several fronts since the start of 2024 – the introduction of new legislation on Capitol Hill, movement on legislation in the states, and key developments in the courts. 340B Health President and CEO Maureen Testoni returns to the show to help us make sense of these developments and how they might affect stakeholders.

Federal bills could help covered entities but also limit 340B’s scope

One new bill introduced in the House of Representatives would restore access for covered entities to 340B pricing through their community and specialty pharmacies, as well as protecting access to discounted pricing at in-house pharmacies. The bill would tackle drug company restrictions that have been in place for nearly four years by authorizing the government to impose civil monetary penalties for drug companies that cut off this access.

But another draft bill under discussion in the U.S. Senate could have more mixed effects on covered entities. The Senate legislation would address the community and specialty pharmacy dispute, but it also could include additional provisions that would limit hospital eligibility for 340B and the types of patients that could receive 340B drugs. 340B Health was among the many stakeholder groups that submitted comments on the Senate bill discussion draft.

Major ruling by federal court is a big win for 340B advocates

The U.S. Court of Appeals for the Eighth Circuit recently ruled in favor of an Arkansas law that protects covered entity access to 340B discounts through specialty and community pharmacies. The pharmaceutical industry had sued to try to block the law in Arkansas as well as a similar law that Louisiana recently enacted. The decision will apply to any additional states within the Eighth Circuit jurisdiction that might enact their own 340B protections. Other federal appeals courts hearing drug industry challenges also will take note of this decision when considering those lawsuits.

West Virginia becomes the third state to protect 340B pharmacy access

The West Virginia governor recently signed into law a new 340B law that closely resembles the statute on the books in Louisiana. 340B hospitals in the state had worked closely with state lawmakers to advocate for the measure and drive it toward enactment. More than 20 states are considering such legislation during their current legislative sessions, so the number of states with 340B pharmacy access laws on the books could grow before the end of the year.

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources

1. House Bill Would End Drugmakers’ 340B Contract Pharmacy Restrictions
2. Learn How Stakeholders Weighed in on Draft Senate 340B Bill
3. Federal Appeals Court Upholds Arkansas Contract Pharmacy Law
4. West Virginia Bans Drugmakers’ Contract Pharmacy Restrictions

One of the most important elements of 340B compliance is preventing duplicate discounts. Ensuring there are no duplicate discounts is high on the list of compliance concerns for covered entities, and it is one of the major items that 340B auditors look for. But how do these entities ensure they stay compliant? On this episode, we speak to Melissa Bruce, an ACE-certified compliance analyst for the 340B Programs Team at UNC Health in North Carolina, to learn more. 

Compliance factors can vary state by state

Melissa notes that it is important for covered entities to think through the duplicate discount compliance requirements in their home state, especially if their health system treats many patients from across state borders. A border state, a community that attracts tourists, or a college town are examples of areas in which providers can face different requirements depending on Medicaid rules for the states where those patients reside.

Ensuring compliance can be complex

Ensuring duplicate discount compliance can be complex, especially if a provider has multiple child sites. How does a health system establish a carve-in or carve-out list? Melissa explains that some entities can have manual workflows that involve individuals reviewing Medicaid dispenses, understanding EHRs, and using spreadsheet skills to keep drug purchases compliant. But given the complexity that UNC Health faced under this method, the health system took a different approach.

Workflow automation can increase reliability and instill trust

UNC Health decided to use an automated workflow approach to streamline manual duplicate discount prevention tasks. The team is rolling out the automation to other locations after finding that it improved accuracy and confidence in the process. Melissa notes that each health system will need to determine whether such an automated process makes sense for them.

Check out all our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources:

1. New Federal Legislation Would End Drug Company Restrictions on 340B
2. Matsui Introduces Legislation To Protect 340B Drug Pricing Program
3. Federal Appeals Court Upholds Arkansas Contract Pharmacy Law

340B hospitals can register certain outpatient locations with the Health Resources & Services Administration (HRSA) as 340B child sites, which allows them to use 340B drugs. HRSA recently announced some changes to how it had been determining this eligibility during the COVID-19 public health emergency. How have these changes affected 340B hospitals, particularly those that had planned new child sites under the previous policy? For the answers to this question and more, we spoke to Chuck Stubbs, a 340B pharmacist with Intermountain Health based in Salt Lake City. 

How new hospital child sites gain 340B eligibility

Chuck explains that 340B child sites are outpatient departments that are not on the main hospital campus but are fully integrated with the hospital parent site. To start using 340B drugs at a new child site, the location must appear on a filed Medicare cost report with associated costs and charges and then be registered with the HRSA Office of Pharmacy Affairs Information System (OPAIS).

What changed during the pandemic

Prior to the COVID-19 pandemic, the process to start using 340B drugs at a new child site could involve up to nearly two years. Chuck notes that during the pandemic, HRSA indicated that child sites that had not yet been registered could begin using 340B drugs right away if they were for eligible patients. Hospitals believed that shift in policy would be permanent.

Where things stand now

The COVID-era child site eligibility changes did not last. In October 2023, HRSA ended what it called a temporary flexibility, citing the termination of the public health emergency in May 2023. Although HRSA granted a grace period for hospitals to come into compliance, that did not provide protections for planned child sites that had not yet been using 340B drugs. Chuck explains how this affected one of Intermountain’s planned sites, and he shares advice for hospitals that are in similar situations.

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources:

1. HRSA Announces Policy Restricting Use of 340B at New Child Sites After Transition Period

The Health Resources & Services Administration audits 200 covered entities each year for compliance with 340B rules. We speak with Mark Capuano, senior director of the corporate pharmacy 340B program at New York City Health and Hospitals, about what hospitals should expect when they find out they will be going through a 340B audit.

How a hospital can prepare for a 340B audit

Auditors typically will ask to schedule a pre-site visit call and will provide a data request list for the information the auditor is seeking. Mark says it is important to provide this information in a timely, accurate and concise way, and to make sure you inform key stakeholders at your organization so you can get the subject matter experts involved. He also recommends doing test runs of the audit ahead of time.

What a hospital should expect on the day of an audit

On the day of an audit, the auditor will trace a sample to see how a 340B drug goes from drugmaker to pharmacy to patient. The auditor will assess whether the hospital is following its 340B policies and procedures to make sure the drug went to an eligible patient and does not involve a duplicate discount. Mark says the process can be very stressful but that it also provides an opportunity to reframe the audit to showcase the great work of your hospital.

What hospitals should do if they receive audit findings

If HRSA issues a finding, the hospital must draft and implement a corrective action plan. Mark recommends bringing in legal counsel and 340B consultants to review this document. After HRSA approves the CAP, the hospital will demonstrate to the agency that it is in place to ensure compliance going forward.

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources:

1. HRSA 340B Program Integrity Website

340B sits at an intersection where federal programs and state agencies come together. Maine, Minnesota, and Washington recently enacted new laws requiring hospitals to report 340B information to the states each year. What should health systems know about these new requirements? We speak with Danny Ackert, the director of state government relations at the Minnesota Hospital Association, to learn more about what these requirements look like in his state and what hospitals might expect in other states considering such reporting.

What Minnesota’s reporting law requires

Danny explains that Minnesota’s new reporting law requires 10 aggregated categories of information that hospitals and other covered entities must submit starting this April. Individual hospitals’ reports will not be made public, but an aggregated report due in November will be made available to the state legislature and the public.

Adjusting to an unprecedented system

Minnesota’s new 340B requirements mandate an entirely new reporting system that the 340B program has not been trained to. These new requirements will affect 340B operations for small and large hospitals alike. 

Advocacy advice for hospitals in other states

Danny urges covered entities in other states that might be considering reporting to be speaking up on 340B now. He says talking about 340B can seem complicated because it involves pharmacy benefits, discounts and acquisitions, costs, savings, and more, but it is important for legislators to be educated on how it works.

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources

1. Senate 340B Bipartisan Working Group Discussion Draft
2. Statement on Senate 340B Bipartisan Working Group Discussion Draft
3. Senators Developing 340B Bill Seek More Feedback on Contract Pharmacy, Patient Definition, Child Sites

We are returning to a popular episode format we aired early last year, when we consulted with 340B Health’s expert staff to answer your most pertinent 340B questions. As we start another busy year for 340B, we help you prepare for the action by answering your questions about the Genesis court decision, 340B activity in state legislatures, Medicare Part B repayments, and more. 

Patient Definition After the Genesis Decision 

One listener wonders how the recent Genesis court decision might affect 340B patient definition issues. We discuss the implications, the status of HRSA’s 1996 patient definition guidelines, and expectations for covered entities in the wake of this decision. 

Federal and State 340B Action

In response to listeners’ question, we discuss how 340B might come up on Capitol Hill and in state legislatures this year. After a busy first half of the 118th Congress for 340B, we discuss how the election year may influence issues on Capitol Hill and how lawmakers in numerous statehouses are already considering changes to 340B in their states. 

Timing of Repayments for Medicare Cuts

Listeners inquire about upcoming Medicare Part B repayments, an increase in manufacturer overcharges for 340B drugs, last year’s HRSA 340B audit findings, and the expected effects of the government’s Medicare drug price-setting program under the Inflation Reduction Act. 

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources

1. HRSA Stresses Federal Court Decision on Patient Definition Only Applies to Genesis FQHC 
2. Implications of Genesis Decision on 340B Patient Definition Webinar
3. State Policy and Advocacy Resource Center 
4. Analysis of the Medicare 340B Pay Cut Remedy
5. HRSA Program Integrity Website
6. Inflation Reduction Act: Assessing Financial and Operational Challenges Webinar 

Episode Description:

The 340B drug pricing program can produce significant savings that hospitals can invest in more equitable care for underserved patients. What are some of the best ways for hospitals to use their savings in the pursuit of greater health equity? We sit down with Danielle McPherson, the executive director of managed care contracting and operations with Mercy Health, to discuss how one Mercy hospital uses 340B savings to close health care gaps in the St. Louis area. Danielle provides practical advice for how other hospitals can take their own integrated, collaborative, and formalized approaches to 340B and health equity.

Investing in preventive and primary care

Mercy Hospital St. Louis invests significant 340B funding into primary and preventive care for patients who face barriers to accessing that care. These include maternal and child care for underserved patients, a clinic partnership in one of the lowest-income areas in the North City of St. Louis, and a mobile mammography van for patients who lack transportation. 

Improving substance use disorder and behavioral health treatment

Mercy Hospital St. Louis found that significant portions of their patient population suffer from behavioral health problems and substance use disorders regardless of their insurance status. In response, the hospital invested more than a million dollars into an emergency department-based screening and therapy initiative and a health network partnership to support patients with the most complex needs.

Helping patients with their drug costs

Mercy Hospital St. Louis found too many patients face health inequities because of the high costs of prescription drugs to treat their chronic diseases. The hospital uses millions in 340B savings to offset drug costs through infusion centers and specialty pharmacies as well as through a partnership with Dispensary of Hope to provide free drugs to patients.

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources

1. Report: 340B Hospitals Advancing Health Equity
2. Takeda Becomes 29th Drugmaker To Impose Restrictions on Use of Contract Pharmacies
3. House Approves 340B Medicaid Spread Reporting Requirement
4. HRSA Manufacturer Notices to Covered Entities

The past several months have seen several major developments in the world of 340B drug pricing. 340B Health President and CEO Maureen Testoni returns to the show to break down some of the most important recent 340B stories.

Landmark Federal Court Ruling on Patient Definition

In November, a federal court in South Carolina ruled against the Health Resources & Services Administration for an unpublished interpretation of 340B patient definition guidelines the agency had been using in audits of covered entities. Maureen explains the implications of this ruling, which could extend far beyond the long-running dispute between HRSA and community health center Genesis Healthcare.

HRSA Notice Officially Limits Use of 340B in New Hospital Clinics

HRSA also released a new notice in October clarifying that new hospital clinics cannot use 340B until they appear on a filed Medicare cost report and are registered – a process that could take up to nearly two years. Maureen describes a transition period for certain hospitals to come into compliance with the policy, continued advocacy for changes to the restrictions, and a new hospital lawsuit over the issue.

Repayments Coming for 340B Medicare Payment Cuts

Hospitals affected by unlawful Medicare payment cuts from 2018-2022 are set to receive direct lump-sum payments by early 2024 under a final rule the Centers for Medicare & Medicaid Services issued in November. Maureen goes over the repayments and discusses lingering concerns about how CMS is implementing the plan.

Check out all of our episodes on the 340B Insight podcast website. You also can stay updated on all 340B Health news and information by visiting our homepage. If you have any questions you’d like us to cover in this podcast, email us at [email protected].

Resources

1. Federal Court Issues Decision Against HRSA Limitation on “Patient”
2. HRSA Facing Hospital Lawsuit Over Child Site Eligibility Policy
3. Read 340B Health’s Analysis of the Medicare 340B Pay Cut Remedy
4. West Virginia Journal: A Health Care Policy We Can All Support
5. Zanesville Times Recorder: Drug Pricing Program Is Critical for Patient Care
6. Los Angeles Sentinel: Black Pharmacists Stand as Advocates in Support of 340B Access to Care
7. The Washington Informer: Holy Cross Health, Maryland, Laser-Focused on Achieving Health Equity Through 340B Drug Discounts