July 14, 2010 – The number of contract arrangements for the provision of 340B-discounted drugs reached an all-time high of just under 3,000 during the first week of July, reaching the mark three-quarters of a year faster than had been projected just in April.
In March, the federal Health Resources and Services Administration (HRSA) issued long-delayed final guidelines allowing covered entities with an in-house outpatient pharmacy to contract with one or more other pharmacies. It’s not entirely clear, however, what role the new rules played in the increase. Officials note that the guidelines went into effect only in April and say that 340B providers and their potential new partners in retail pharmacy are still exploring their options for the most part.
In any event, the unexpected rise in the number of contracts certainly appears to reflect 340B providers’ strong interest in new ways of enhancing pharmacy care for outpatients.
End of a three-year wait
HRSA’s publication of the rules ended a three-year wait for 340B and retail pharmacies that began when the guidelines were released in draft form in 2007. Previous rules barred covered entities with an in-house pharmacy from any contracting. Entities lacking an in-house pharmacy were prevented from contracting with more than one pharmacy.
Lisa Scholz, senior director of the Pharmacy Services Support Center (PSSC), HRSA’s technical assistance branch, says that while interest in the new rules is sharp, actual “uptake” has been fairly slow.
“Even now three months in, it’s still a very new concept for the covered entities and the potential new stakeholders,” she says. “They’re all in a learning phase, seeking information and checking out if this is a good direction for them to take.”
Scholz says potential contractors have expressed “a lot of interest” in the rules, wanting to know how to enroll or how to find a 340B covered entity that’s looking for a partner. Some know exactly which entities they would like to team up with and want to know how to make the connection.
“On the other end, we’re getting questions from covered entities about how to enroll and fill out the application,” she continues. Several have asked how they themselves can become a contract pharmacy for another nearby 340B provider.
Scholz says PSSC has also received a number of calls about setting dispensing fees under contract arrangements. While her agency cannot tell callers exactly how to set such fees, it points them to studies and other resources “so they can determine what’s best for them,” Scholz says.
PSSC is also offering covered entities “a financial tool that helps them determine whether a contract arrangement will be financially sustainable over time or will cost them money,” she says.