August 7, 2009 – 340B providers will be required to bill Medi-Cal at actual acquisition cost and unable to carve Medi-Cal drugs out of the 340B program. The changes went into effect when Gov. Arnold Schwarzenegger signed a California budget bill July 28, and will be implemented in September.
The legislation allows a 340B provider to bill at regular Medi-Cal reimbursement rates for a specific drug only if the provider is unable to purchase the drug at 340B prices and maintains documentation of its inability to obtain the drug at a 340B discount.
Covered entities will still be able to bill the appropriate statutory professional or dispensing fee. Under Medi-Cal, the dispensing fee for retail outpatient drugs is $7.25. Family planning and other clinics are able to bill $12 per billing unit for dispensing at the clinic, or $17 per prescription for the cost of dispensing take-home drugs.
The 340B carve-out prohibition comes as the state seeks to balance its $24-billion budget deficit. Medi-Cal estimates that the measure will save the state $3.8 million and the federal government $3.8 million in fiscal 2009-2010 – all at the expense of 340B providers. (SeeMonitor July 2009.)