As the new year gets underway, this is a great time to review your 340B Program to ensure you are in compliance with HRSA/OPA requirements and recommendations.

Consider these 9 tips for stronger compliance in 2015:

1. Check the HRSA/OPA website
You will want to make sure that all of your 340B program “Child Sites” are correctly listed as eligible locations and that all contract pharmacies are correctly registered. If additions, deletions, or corrections are needed, the next registration period is January 1 – 15, 2015, for new “Child Sites” and/or contract pharmacies to be eligible on April 1, 2015. New registrations are also accepted April 1-15 and July 1-15.

2. Are your 340B policies and procedures up-to-date and complete?
Auditors expect each covered entity to create, update and maintain their own policies and procedures.

3. What is your “material breach” threshold?
HRSA recommends that each covered entity defines a threshold against which any violation or instance of non-compliance is measured. When the level of violation or non-compliance exceeds this threshold, different corrective actions are required. The material breach threshold may be a dollar amount or a percentage of drug spend. Visante recommends the “percentage of total drug spend” approach, since it is easy to identify total drug purchases from monthly / YTD expense reports. We also suggest that 5% might be an acceptable amount, but in any case, this threshold should be included as part of your 340B policies and procedures.

4. Are you conducting routine self-audits?
Regular self-audits are recommended to help you verify that your 340B program is working as expected. If not, a self-audit can help you identify issues so that they can be corrected. If necessary, you may need to self-report your findings to HRSA. Self-reporting is typically required when non-compliance exceeds your material breach threshold.

5. A self-audit should evaluate these four key points of eligibility to maintain compliance:
-Has the patient had a registered visit at an eligible “Child Site” or hospital-based clinic listed on the OPA website?
-Was the prescription written in a 340B-eligible “Child Site” or hospital-based clinic of the covered entity?
-Was the prescription initiated by a health care professional who was either employed by the covered entity or provides health care under contractual or other arrangement (e.g. referral for consultation)?
-Does the covered entity maintain a record of the care provided, documenting that responsibility for the care provided remains with the covered entity?

6. Medicaid and Medicaid Managed Care compliance should also be reviewed.
Are you listed on the OPA Database as “carving-out” or “carving-in” for Medicaid? Each state deals with Medicaid and Medicaid Managed Care differently. State-specific requirements may treat Medicaid Managed Care in the same way as traditional Medicaid, while others do not. Contact your State Medicaid Office to determine the specific way your state is treating Medicaid Managed Care. To guard against Medicaid duplicate discounts, make sure that your “split-billing” software configuration options match your state-specific requirements and your OPA Database preferences for handling prescriptions for your Medicaid and Medicaid Managed Care patients.

7. For Disproportionate Share Hospitals, free-standing Children’s Hospitals, and free-standing Cancer Hospitals the GPO prohibition is important.
Review your “split-billing” software’s 340B vs. GPO vs. WAC configurations to ensure that you are managing the GPO prohibition correctly, and to match program requirements to your policies.

8. The Orphan drug exclusion should also be considered.
Critical access hospitals (CAHs), sole community hospitals (SCHs), rural referral centers (RRCs), and free-standing cancer centers (CANs), may purchase “Orphan Drugs” for non-orphan indications provided that the hospital will maintain auditable records regarding the use of such drugs for non-orphan indications. CHAs, SCHs, RRCs, and CANs, should verify their preferences on the OPA Database.

9. How is your organization using the 340B discount benefit?
Visante recommends that each Covered Entity create a formal document of exactly how it uses the 340B discount benefit to support and expand care to uninsured, underinsured, and indigent patients. Some organizations have included this type of document with their 340B policies and procedures.

If you need more information to take advantage of these nine tips or need assistance with registering your “Child Sites,” developing or reviewing your 340B P&Ps, or would like a better understanding of the orphan drug interpretive rule issued by HRSA / OPA, contact any of Visante’s 340B consultants listed below. We will be happy to help you and your organization to strengthen your 340B compliance in 2015!

Kristin Fox-Smith –
Douglas E. Miller –
William W. (Bill) Wood –

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