November 20, 2015—Proposed 340B drug discount policy changes – especially those affecting discharge prescriptions, physician eligibility, and infusion drugs – will jeopardize hospitals’ ability to care for vulnerable patients if the government finalizes them as is, hospital leaders warned at a Capitol Hill briefing yesterday. [ms-protect-content id=”2799″]
The American Hospital Association organized the event, which was aimed mainly at congressional staff. AHA at the same time released an animated video explaining the 340B program’s benefits.
The Health Resources and Services Administration released far-ranging proposed guidance for the 340B program in late August that among other changes would:
- appear to bar using 340B for drugs in connection with discharge prescriptions when a patient is discharged from an inpatient setting, even though such drugs are billed on an outpatient basis
- prohibit 340B use in connection with infusion drugs unless the order for infusion is written by a hospital provider as a result of a service provided at the hospital
- let hospitals use 340B discounted drugs only when the patient receives care from a health care professional employed by the hospitals or who is an independent contractor of the hospital such that the hospital may bill for services on behalf of the provider
- restrict hospitals from using 340B drugs for care resulting from referrals to outside specialists and other providers
Raja Zeitany, vice president and chief pharmacy officer of Providence Health & Services, said the five-state health system, which has 24 hospitals enrolled in 340B, estimates that these and other changes in HRSA’s guidance would mean that 80 percent of its patients would no longer quality for 340B drugs.
“Drug prices are rising at an astronomical level and we don’t know how we are going to manage it,” Zeitany said. “The 340B program is supposed to help ease the impact on us of the high cost of drugs. This new guidance would add a whole new layer of complexity to the 340B program and appears to reduce access to the program for those that need it.”
Zeitany said that under existing HRSA policy, Providence brings free or reduced cost 340B-purchased medicines to low-income patients in their hospital rooms before they are discharged. The system does this, he explained, because ” once they’re out, if they don’t have their meds, they’re coming back to the ER and they’re going to get readmitted and it will cost thousands of dollars in care for that readmission.”
“At Providence, we are going hospital by hospital trying to quantify what 340B savings are going for,” Zeitany said. Savings from the 340B program, he continued, “allow you to buy things like “smart” infusion pumps” to help prevent IV medication errors. “So the reach of the program is tremendous,” he said. “It allows those of us who serve a high percentage of indigent patients to meet their needs.”
David Neu, executive director of pharmacy at St. Thomas Health in Nashville, Tenn., said HRSA’s proposed requirement that physicians be either employed by or under contract with 340B hospitals and that hospitals be able to bill for the physicians’ service “is going to require a major restructuring of physician-hospital contracts, and that comes at a major cost to the facility.”
“In some states like California, it’s illegal for a hospital to bill for a physician’s professional services,” Zeitany added. “So the way the guidance is written would literally exclude every currently eligible 340B entity in California.”
The hospital leaders also criticized HRSA’s proposal to declare patients ineligible to receive a 340B drug if the only care they receive is the infusion of the drug.
“I assure you that when a patient receives an infused medication, they are not just receiving the infusion; there’s a whole host of services that go around that,” said Bob Ripley, vice president and chief pharmacy officer at Trinity Health. “The proposed narrowing of the patient definition would likely reduce patient access to hospital-based infusion centers, resulting in patients needing to travel outside their communities to receive these medicines. It would be a major setback to our system if we lost that.”
Ripley and the other hospital executives also strongly contested the frequently made claim that hospitals have been on infusion center buying spree to maximize 340B profits.
“I was recently talking to one of our system’s sole community hospitals, and they were finding that their drugs costs in their infusion center, even though they’re 340B, are so excessive that the payments they are receiving aren’t covering their costs,” Ripley said. “I can assure you that, while hospitals are indeed buying infusion and oncology centers, they’re not doing it to pad their bottom lines. I don’t think the 340B systems are buying up oncology practices faster than anybody else. I also think the oncology practices are walking up to the 340B systems across the street and saying, “I can’t do this anymore myself; I need to be part of a system.” [/ms-protect-content]