by Kristin Fox-Smith and Bill Wood

The Winter 340B Coalition Conference was held February 17-19 in San Diego. Visante’s team of 340B compliance experts was on hand to learn key information that will impact covered entities in 2016. Below is a short summary of what we learned.

Status of the “Mega Guidance”

On everyone’s mind is the status of the “Mega Guidance.” While not unexpected, the information coming out of 340B Health related to HRSA’s Proposed Omnibus Guidance (the Mega Guidance) is that there is continual skepticism about a date for release in the near future. There was some indication that the Guidance may be released in the fall, if not later. Consequently, many covered entities continue to be in a “holding” pattern pending the release of the Mega Guidance, and are choosing not to engage in a 340B Program audit or the current HRSA expected independent external audit of contract pharmacies. It is essential that covered entities continue to observe all current 340B rules, regulations, and guidelines, pending issuance of Mega Guidance clarification, and continue to meet all Program requirements and conduct robust internal audits and manage Program compliance.

Medicaid Managed Care Organization Billing

There continues to be no new information related to Medicaid Managed Care Organization (MCO) billing. There is still no standard method of identifying MCO claims. States presently utilize a variety of methods to identify Medicaid MCO claims. A few of these are:

  • Forced carve out of MCO 340B claims (Delaware is doing this now)
  • State-specific plans to use methods other than the Medicaid Exclusion File
  • Suggestion of having separate Medicaid Exclusion File (MEF) for FFS and for MCO

States are expected by the Centers for Medicare and Medicaid Services (CMS) to develop and implement methods to identify MCO claims. However, there is still no consistent approach and CMS appears to be relying more on the states for answers.

340B Implications of the AMP Rule

The Average Manufacturer Price (AMP) Rule was originally proposed in 2012 to implement Medicaid provisions in the Affordable Care Act (ACA) and address other issues. The final AMP Rule was issued Jan. 21, 2016, and published in Federal Register Feb. 1, 2016 (81 Fed. Reg. 5170).

Key Areas of Expected Impact on 340B from the AMP Rule:

  • ACA provisions include determination of the average manufacturer price (AMP) and expansion of rebates to Medicaid managed care
  • Other provisions include:
    • State reimbursement of fee-for-service (FFS) drugs at Actual Acquisition Cost (AAC)
    • Exclusions from the “best price” requirement
    • Manufacturer reporting requirements
  • These provisions appear to apply to retail settings and not physician administered drugs

Key Implications for 340B:

  • No direct changes to 340B compliance requirements for covered entities
  • Immediate, indirect impact
    • AMP could have an indirect impact on 340B price
    • Best price exclusions could make it easier for 340B entities to access voluntary discounts from manufacturers
  • Future state guidance
    • No immediate impact on reimbursement, but states that are not already doing so may make changes over the next year to base 340B payments on actual acquisition cost (AAC)
    • States are now instructed to issue guidance on how entities can identify 340B managed care claims

Summary

While covered entities await the Mega Guidance, issues such as Medicaid Managed Care Organization Billing and implications of the AMP Rule should be considered now. In addition, it is as important as ever to effectively manage compliance of each covered entity’s 340B Program. Specific actions such as self-audits and independent annual audits will continue to promote and improve 340B Program compliance.

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