November 9, 2011—The Health Resources and Services Administration (HRSA) “needs to get a handle on potential abuse” in the 340B drug discount program “before program growth gets out of hand, the taxpayers have to pay for it, and program sustainability is in question,” the ranking Republican member of the U.S. Senate Judiciary Committee said today.
Sen. Chuck Grassley (R-Iowa) made the remark in a news release noting that he, Sen. Orrin Hatch (R-Utah) and Rep. Fred Upton (R-Mich.) have received the detailed accounting of HRSA’s oversight of the 340B program that they requested on Sept. 22. Hatch is the ranking Republican member of the Senate Finance Committee and Upton chairs the House Energy and Commerce Committee. The trio asked HRSA for the information on the same day that the Government Accountability Office (GAO) released a major report on the program.
Grassley’s statement to the media included HRSA’s 17-page response to the request for information. The Monitor will be reporting on that document in greater depth shortly.
In response to the lawmakers’ questions, HRSA said it “has not independently carried out audits of 340B covered entities or participating manufacturers to date” but “plans to conduct selected audits of participating covered entities” during the current fiscal year. A spreadsheet included in the document projects that the audits will begin in February 2012, with report following in two to three months.
HRSA noted in its reply that although it had conducted no audits of its own, it had worked closely with the Department of Health and Human Service Office of the Inspector General (OIG) on a 2000 audit of the Mashantucket Pequot Tribe and with the Justice Department (DOJ) on its 2005 audit of and subsequent prosecution of a physician at Aliquippa Community Hospital in Pennsylvania. Both cases resulted in the covered entities’ removal from the program.
“Those were both very narrow cases,” Grassley said in his news release. “With the lack of oversight, the taxpayers through state and federal governments could be grossly overpaying for prescription drugs and not know it, and that situation could continue to accelerate. The agency needs to start conducting oversight and keep going.”