by admin | April 9, 2013 1:54 pm
April 9, 2013—The Health Resources and Services Administration (HRSA) has given certain 340B hospitals that could not meet an April 7 deadline[1] to change their drug purchasing and replenishment systems a four month extension.
Hospitals that were able to make the changes on time were required to do so by the end of the day Sunday.[ms-protect-content id=”2799″] The switch is expected to cut their 340B savings appreciably. HRSA warned that it could immediately remove hospitals from the drug discount program if it discovered they were taking advantage of the new deadline to minimize their losses.
The 340B statute prohibits disproportionate share (DSH) and free-standing children’s and cancer hospitals from participating in group purchasing organizations for covered outpatient drugs. HRSA had never clarified the prohibition’s parameters until Feb. 7, when it issued guidance stating that 340B DSH, children’s, and cancer hospitals could not initially buy drugs through GPOs and replenish those given to 340B-eligible patients with drugs bought through 340B. This had long been a common practice in hospital emergency, surgery, and other “mixed-use” settings where a patient’s 340B eligibility is unknown at the time drugs are given.
HRSA originally gave all affected hospitals 60 days, or until April 7, to change their inventory management and replenishment systems. For most facilities, this means opening wholesale acquisition cost (WAC) accounts with their drug wholesalers and overhauling their virtual drug inventory software. Many hospitals privately said 60 days simply was not enough time to make such a complicated change. But many did not want to tell that to HRSA because they feared doing would be construed as an admission of program non-compliance that would subject them to penalties.
Hospital groups conveyed the message to HRSA on their members’ behalf, but HRSA indicated it would consider deadline extensions only on a case-by-case basis and only if it heard from individual hospitals themselves.
HRSA changed its position not long after eight U.S. Senators and 37 U.S. Representatives sent it letters last week requesting a six-month delay to ensure that hospitals “have sufficient time to implement this guidance while continuing to provide patients with the health care services and treatments they need.”
In an April 5 update[2] to its online 340B frequently asked questions, HRSA said it was extending the deadline to Aug. 7 for hospitals unable to comply with the initial April 7 deadline “based on a large number of covered entities providing comments that this deadline could not be met due to the work required to implement the needed changes.”
HRSA said it will grant no extensions beyond Aug. 7. “If a covered entity is unable to be in compliance by Aug. 7, the covered entity must immediately notify HRSA, and will be terminated from the program,” it said, adding that will involuntarily terminate any non-compliant hospitals it discovers after Aug. 7.
HRSA also announced that it has postponed the next annual recertification of hospitals’ eligibility for 340B until after Aug. 7. The process was expected to begin either in late spring or early summer.
Safety Net Hospitals for Pharmaceutical Access (SNHPA), which represents hospitals and health systems enrolled in 340B, said in a statement[3] that it was pleased that the deadline had been extended and that hospital recertification had been pushed back.
SNHPA added, however, that is still has concerns about other aspects of HRSA’s new policy that created compliance problems for its members that the deadline extension did not address. “We are continuing to evaluate the options available to address these issues,” it said.
The American Hospital Association, which also asked HRSA to extend the deadline, said the extra time[4] “will allow hospitals … to work with their vendors and wholesalers to address the many process and procedural challenges that arose from the HRSA notice.”[/ms-protect-content]
Source URL: https://340bemployed.org/hrsa-partially-extends-340b-gpo-exclusion-deadline-to-aug-7/
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