by admin | May 6, 2013 1:39 pm
May 6, 2013—The Illinois Department of Healthcare and Family Services has reversed a decision it made earlier this year to require 340B contract pharmacies to use 340B drugs for Medicaid patients beginning this July.
In a recent statement on its website[1], the department said it was putting the requirement on indefinite hold. “In the contract pharmacy scenario, the pharmacy can continue to use non-340B drugs for Medicaid patients,” it said.[ms-protect-content id=”2799″]
Illinois enacted legislation last year[2] requiring all providers eligible for 340B to enroll in the 340B program and to use only 340B drugs for Medicaid beneficiaries. The state already required 340B entities to bill at actual acquisition cost (AAC) if they carved in their Medicaid patients.
The Illinois Hospital Association (IHA) said the department decision’s about contract pharmacy was “reasonable and workable” and it thanked the agency “for its willingness to work with IHA and the provider community.”
Illinois 340B stakeholders were concerned that, with a Medicaid carve-in mandate in place, 340B contract pharmacy would have become too onerous to manage. There were also concerns that retail and community pharmacies would have been unwilling to contract with 340B providers due to low reimbursement.
In addition to its rule on contract pharmacy, the state has issued regulations and guidelines to implement other aspects of the law including:
Payment. Illinois Medicaid will reimburse 340B brand-name and generic drugs at the lesser of actual acquisition cost (AAC) or a drug’s “340B allowable reimbursement rate,” plus a $12 dispensing fee. The new rules and guidelines, however, do not define “340B allowable reimbursement rates.” The elevated dispensing fee will also apply to 340B-physician administered drugs.
Physician-Administered Drugs. Hospitals must bill specific 340B physician-administered drugs listed in the guidance at actual acquisition cost (AAC), but the state has not yet determined this requirement’s effective date. Hospitals that have not yet implemented the requirement can continue billing for these drugs at their usual and customary (U&C) rates. Claims billed at U&C will later be adjusted to AAC.
Identification of 340B Claims. 340B retail claims must be identified using NCPDP value “20” and 340B physician-administered drugs with a “UD” modifier. If a pharmacy did not know at the point of sale that a retail claim was 340B-eligible, it must retrospectively void and rebill the claim as 340B using the “20” value.
Out-of-State Providers. Illinois Medicaid says that, “for now,” it does not expect out-of-state providers to include Medicaid in their 340B purchases if they exclude Medicaid from their 340B purchases in their home state. Out-of-state providers that carve-in Medicaid for Illinois must bill 340B drugs at AAC.
Medicaid Managed Care. The state says the new requirements “do not currently” apply to drugs dispensed or administered to Medicaid managed care beneficiaries.
Indigent Care Agreements. With respect to private, nonprofit critical access hospitals only, the state said if one (a) does not have an indigent care agreement with local or state government and (b) does not participate in 340B, it will not require it to enter such a contract and enroll in 340B. It is unclear whether the state will treat other types of nonprofit hospitals the same if they, too, do not have such contracts and are not enrolled in 340B.[/ms-protect-content]
Source URL: https://340bemployed.org/illinois-fleshes-out-340b-participation-requirement/
Copyright ©2025 340bemployed.org unless otherwise noted.