February 5, 2015—The Health Resources and Services Administration plans in June to issue wide-ranging 340B program guidance on patient definition and other issues over which it lacks clear authority to regulate, the head of HRSA’s Office of Pharmacy Affairs said today. [ms-protect-content id=”2799″]
In a videotaped address during the 340B Coalition winter meeting in San Francisco, OPA Director Cmdr. Krista Pedley also said that HRSA hopes to have information to share “very soon” about the outcome of the first 340B audit of a drug manufacturer, which HRSA is conducting jointly with the Department of Health and Human Services Office of Inspector General. “We are developing a protocol to move forward on additional audits of manufacturers to be conducted in fiscal year 2015,” she said.
In addition to patient definition, the long-awaited omnibus 340B guidance will also cover hospital eligibility, contract pharmacy, annual covered entity recertification, audits, Medicaid fee-for-service and managed care duplicate discounts, manufacturer limited distribution plans, manufacturer refunds and credits to covered entities, “and more,” Cmdr. Pedley said. The guidance will be proposed, not final, and there will be a public comment period, she said.
This spring, HRSA also plans to issue proposed 340B regulations for notice and comment establishing civil monetary penalties for drug manufacturers and procedures for calculating 340B ceiling prices, both of which its has explicit authority from Congress to regulate, Cmdr. Pedley said. The monetary penalties “will be levied when a manufacturer knowingly and intentionally charges covered entities more than the statutory mandated ceiling price,” she said.
In the fall, HRSA will similarly issue a proposed regulation establishing a mandatory and binding administrative dispute resolution process for the program, she added.
HRSA has audited 277 covered entities to date, encompassing more than 3,200 outpatient facilities or sub-grantees and over 8,500 contract pharmacies, Cmdr. Pedley said. No covered entities or contract pharmacies have been removed from the program due to an audit. For the first time, however, HRSA recently removed one hospital’s child sited from 340B “for failure to be on the entity’s Medicare cost report and because the entity no longer owned and operated the child site,” she said.
HRSA has contracted with an information technology vendor to develop a system enabling it to keep even closer tabs on covered entity compliance with 340B program requirements, Cmdr. Pedley said. It will be linked to the existing 340B database. In addition, the 340B Prime Vendor may make information about participant transactions available to HRSA for the project. “This new system will be able to access that information regularly and mine the data to create an early- warning system to flag covered entities that may be at risk for non-compliance,” Cmdr. Pedley said.
HRSA, meanwhile, also is “actively engaged in manufacturer oversight,” she said. By the end of the current fiscal year in September, HRSA plans to have a system in place enabling covered entities to access 340B ceiling prices on a secure website. Cmdr. Pedley said this initiative would also include spot checks of sales transactions to assess manufacturer compliance. [/ms-protect-content]