Southwest Consulting Associates Blog

In October, The Department of Health and Human Services Office of Inspector General (OIG) issued a policy statement to explain specific conditions when hospitals can discount or waive fees owed by Medicare beneficiaries for self-administered drugs received in outpatient settings without being subject to federal anti-kickback sanctions. This applies to self-administered drugs that are not covered by Medicare Part B, including drugs that may be covered under Medicare Part D.

The 340B Drug Pricing Program Omnibus Guidance (Mega-Guidance) was published for public comment August 28, 2015.  You can find it HERE.  Part B beginning on page 21 reviews drugs eligible for purchase under 340B or covered outpatient drugs.  While this section only makes up 2 pages of the 90-page guidance, the subject matter can have an extensive impact on 340B covered entities.

The 340B Drug Pricing Program Omnibus Guidance (Mega-Guidance) was published for public comment August 28, 2015.  You can find it HERE. Please note, the comment deadline is quickly approaching as it is TUESDAY, OCTOBER 27, 2015.  While the Mega-Guidance addressed numerous areas of the 340B program, the most significant proposed changes were in the areas of:

Disproportionate Share Hospitals (DSH), Children’s Hospitals and Freestanding Cancer Hospitals participating in the 340B program are subject to GPO prohibition. These hospitals may not purchase 340B covered outpatient drugs through a group purchasing organization (GPO) or other group purchasing arrangement. However, inpatient drugs and non-covered outpatient drugs may be purchased using a GPO.

The proposed guidance added some additional language to the hospital 340B eligibility requirements.  There is some language change in the first category of hospitals; however, the biggest change is in the third category of hospitals which many DSH hospitals fall into.  There are changes in the required elements in the contract that private, non-profit hospitals must have with their State or local government to provide health care services to low income individuals. Hospitals should take note of the changes for their respective category, evaluate what impact the changes will have and submit comments to HHS if necessary. If the Mega-Guidance is finalized as proposed, 340B covered entities will need to ensure their contracts contain the additional language required.

The 340B Drug Pricing Program Omnibus Guidance (Mega­Guidance) was published for public comment August 28, 2015.  This Mega­-Guidance can be found HERE. The proposed Mega-Guidance adds that a child site should have “associated outpatient Medicare cost and charges on the most recently filed Medicare cost report to demonstrate the child site’s eligibility.  This is different from the 1994 Final Notice on Outpatient Hospital Facilities posted in the Federal Register and different from any previous OPA guidance provided in OPA’s FAQs.

As you may have heard, the 340B Drug Pricing Program Omnibus Guidance (Mega-Guidance) was published for public comment last Friday, August 28, 2015.  You can find it HERE. Please note, comments should be submitted on or before TUESDAY, OCTOBER 27, 2015.  While the Mega-Guidance addressed numerous areas of the 340B program, the most significant proposed changes were in the areas of:

• patient definition

• physician administered drugs (stricter guidance)

• record retention standards

• duplicate discounts including Medicaid Managed Care

• contract pharmacy

At the July 340B Coalition meeting in Washington DC, the Assistant Inspector General for Evaluation and Inspections for the Office of Inspector General (OIG), Ann Maxwell, presented on the “Government Watchdog’s Perspective”. Maxwell gave a brief high level overview covering three areas the OIG has been investigating and auditing in the 340B arena:

1. Ceiling price

2. Intersection of the 340B Program with other federal healthcare programs

3. Contract pharmacy arrangements

About the Report

The Government Accountability Office (GAO) released a study last month comparing Medicare Part B spending at hospitals participating in the 340B drug pricing program to non-340B program hospitals. The study has raised more questions because no patient outcome data was provided to support many of its claims.  The GAO analyzed 2008 and 2012 data from the Health Resources and Services Administration (HRSA) and the Centers for Medicare and Medicaid Services (CMS) to compare financial characteristics along with Medicare Part B drug spending for 340B eligible hospitals and non-340B hospitals.  The GAO study found that “per beneficiary Medicare Part B drug spending, including oncology drug spending, was substantially higher”, in some cases more than double, “at 340B DSH hospitals than at non-340B hospitals.”

Yesterday, August 4, 2015, the Office of Management and Budget (OMB) posted that the review of the 340B Program Omnibus Guidelines (mega-guidance) has been extended.  Yesterday marked 90 days that the Omnibus Guidelines had been before the OMB.  After 90 days, the OMB can extend the review period on a one-time basis for no more than 30 days or the review period may be extended indefinitely by the head of the rulemaking agency which in this case, is HRSA.  At this time, it is unknown which agency extended the review.