Four Big 340B Mega-Guidance Concerns for Hospitals

by Admin | September 7, 2016 1:27 pm

September 7, 2016—Safety net hospitals and their patients will suffer if parts of the final 340B program mega-guidance remain unchanged from the Health Resources and Services Administration proposal last year.

On Sept. 1[1], HRSA sent its final mega-guidance to the White House Office of Management and Budget for review before official release in the Federal Register. It looks to be on track for release in late November or early December for now. But it could come out sooner or be deferred to the next presidential administration. Also for now, it is confidential. HRSA published its proposed mega-guidance for comment in August 2015[2]. While parts of the mega-guidance are non-controversial, hospitals warned[3] that, without change, other parts would have “an extremely adverse impact on hospitals’ 340B programs and their efforts to meet the needs of their underserved patients.”

Almost two-thirds of the comments HRSA received came from 340B hospitals, and they are hopeful that HRSA took their position into account.

Hospitals are especially troubled by these problem areas:

1. No 340B discounts for prescriptions given to patients upon discharge from inpatient stays from the hospital, even though such prescriptions play a significant role in reducing readmissions
2. No 340B discounts for infusions administered to many hospital outpatients
3. No 340B discounts for outpatient drugs furnished to patients that are ultimately admitted to the hospital
4. No 340B discounts for outpatient drugs given to hospital patients unless the hospital bills for the prescriber’s professional services, a practice most hospitals cannot do

Discharge scripts

340B is commonly used for prescriptions written at the end of an inpatient stay to be filled on an outpatient basis to ensure patients have access to affordable medication and do not suffer relapses. HRSA’s proposed guidance would end this practice. Eighty-one percent of 340B hospitals surveyed about the proposed mega-guidance said they would lose discounts if this measure were enacted. Eleven percent say they could be forced to drop 340B altogether due to this measure. This figure is 22 percent if disproportionate share and free-standing children’s and cancer hospitals have to use wholesale acquisition cost pricing instead of group purchasing organization pricing.

Infusions

It is common for patients to seek diagnosis for conditions that require infusion care (like cancer) in a location far away and pursue treatment close to home. The proposed mega-guidance would end discounts for infusion orders written under this scenario, which has the potential to shut down infusion centers. Eighty five percent of hospitals would lose 340B discounts if this measure were enacted. Twenty one percent say they could be forced to drop 340B altogether due to this measure.

Outpatient drugs furnished to patients who are ultimately admitted

The 72-hour Medicare reimbursement rule (also known as the three-day rule) requires outpatient services within three days of hospital admissions to be billed as part of inpatient services. The rule does not retroactively change a patient’s outpatient status. Because these patients are outpatients at the time of care, most 340B hospitals use 340B for their medication. The proposed mega-guidance would end this practice. Eighty one percent of hospitals would lose discounts if this measure were enacted. Seventeen percent would consider dropping 340B if this provision were enacted. This figure rises to 20 percent if DSH and free-standing children’s and cancer hospitals have to use WAC pricing.

Requiring scripts to be written by hospital employees

The proposed mega-guidance would require that for scripts to be filled at a 340B-discounted price, they must be written by an employee or independent contractor of the hospital such that the hospital may bill for services on behalf of the provider. This proposal would render 340B useless or operationally impossible for many hospitals. And because HRSA’s proposed definition of eligible providers is vague, it is difficult to fully gauge how badly this provision would impact hospitals. Every 340B hospital has the potential to lose discounts. Seventy two percent of hospitals would not be able to bill for the services of privileged physicians, and thus could lose any discounts related to that care, depending on what HRSA means by this proposed language. Twenty five percent of hospitals would consider dropping out of 340B were this proposed provision implemented.

Read the Report

Click here[4] for the survey report on how the 340B mega-guidance, if unchanged from last year’s proposal, would hurt hospitals and their patients.

Source URL: https://340binformed.org/2016/09/four-big-340b-mega-guidance-concerns-for-hospitals/

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