March 14, 2013—The Health Resources and Services Administration (HRSA) is developing a comprehensive regulation for the entire 340B drug discount program that, among other provisions, would restate which patients may receive 340B-discounted medicines.
Office of Pharmacy Affairs (OPA) Director Cmdr. Krista Pedley disclosed the plan for an omnibus 340B rule during a March 12 meeting of drug manufacturer representatives in Baltimore.[ms-protect-content id=”2799″] She said it would be “months” before the draft rule would be ready for publication for notice and comment in the Federal Register.
The 340B program has operated without formal regulations for its entire 20-year history. The issuance of any 340B regulation—much less one of such scope—would be a milestone. To date, HRSA has issued all interpretations of the 340B statute and program policy directives in sub-regulatory form.
The White House Office of Management and Budget is currently reviewing the final draft of what could become the program’s first regulation: a rule to clarify the Affordable Care Act’s (ACA) restriction on 340B discounts for orphan drugs purchased by hospitals that became eligible for 340B under health care reform.
Cmdr. Pedley’s remarks about the program-wide regulation were in response to a question about the status of 340B’s patient definition. In January 2011, HRSA sent OMB a revised patient definition for review prior to publication in the Federal Register. OMB returned it to HRSA with unspecified changes in May 2011 and it was never reissued. It is not known if the 2011 draft definition was proposed as guidance or as a regulation.
In 2007, HRSA proposed patient definition guidance that was never finalized.
HRSA’s existing guidance, issued in 1996, states that an individual is a patient of a 340B covered entity (with the exception of state AIDS drug assistance programs) only if:
- the covered entity has established a relationship with the individual, such that the entity maintains records of the individual’s health care;
- the individual receives health care services from a health care professional who is either employed by the covered entity or provides health care under contractual or other arrangements (e.g. referral for consultation) such that responsibility for the care provided remains with the entity; and
- for 340B health centers and specialized clinics (e.g. hemophilia treatment, Title X family planning, etc.), the individual receives health care services from the covered entity consistent with those for which grant funding or federally-qualified health center look-alike status has been provided to the entity. Hospitals are exempt from this last requirement.
An individual is not considered a patient for 340B purposes if the only health care service he or she receives is the dispensing of a drug for self-administration or administration in the home setting.
Cmdr. Pedley also addressed the following topics during her talk at the industry conference:
- HRSA has commenced 30 audits of 340B covered entities so far in fiscal 2013, which began Oct. 1. HRSA, meanwhile, has doubled its number of auditors in the field, from 10 to 20.
- Cmdr. Pedley indicated that the Obama administration will once again propose a fee on 340B drug purchases to finance OPA. Congress has failed to act on the proposal in each of the past two years. The last two proposals would have assigned drug manufacturers the duty to collect and then submit them to the government. This year, “manufacturers would not be part of that process as that currently stands,” Cmdr. Pedley said.[/ms-protect-content]