beyond the pharmacy Common 340B program concerns for hospitals Making sure expectations meet reality March 13, 2015

Transcription

1 beyond the pharmacy Common 340B program concerns for hospitals Making sure expectations meet reality March 13, 2015 Lidia A. Rodriguez-Hupp SVP & 340B Compliance Officer Christopher Boles Regional VP, Sales

2 course overview 340B overview: compliance through the years Developing policies and procedures to address compliance risks Enforcing compliance with HRSA audits Tailoring a compliance plan for your organization 340B compliance: it s everybody s business 2

3 340B overview: compliance through the years

4 the intent of 340B To stretch scarce Federal resources as far as possible, reaching more eligible patients and providing more comprehensive services * * H.R. Rep. No (II), at 12 (1992) 4

5 what is 340B A federal drug discount program that requires manufacturers to provide outpatient drugs at greatly discounted prices to covered hospitals or entities locations strictly-outpatient settings Physician-owned clinics mixed-use settings Departments such as ED, where patients can be both inpatient and outpatient OP discharges to OP pharmacies Hospital-owned or contract pharmacies, such as CVS or Walgreens 5

6 to participate in 340B, an entity must ensure register recertify it has the capability to follow and maintain auditable records documenting compliance with program rules on the HRSA 340B database with HRSA 340B annually 6

7 annual 340B recertification As of 2012, HRSA rules require that all covered entities recertify their compliance with all 340B program rules on an annual basis > Offsite clinics and departments associated with a child site of a parent hospital must individually register as child sites of the covered entity Even when they share the same building or have been registered previously as a single child site > Outpatient clinics and individual parent hospital departments do not need to register separately Must maintain auditable records 7

8 340B GPO and orphan drug The GPO prohibition pertains to these entities: Drug purchases through GPO (Group Purchasing Organization) contracts cannot be used for outpatients covered by 340B The orphan drug exclusion pertains to: Applies to less than 500 of the 2,600 drugs with orphan status Requires participating entities to track use, ensure drugs are not purchased under 340B for those conditions and diseases it has received orphan drug designation, and maintain auditable compliance records Drugs can be sold at 340B prices if being used to treat conditions/ diseases other than those for which the drug received designation 8

9 Developing policies and procedures to address compliance risks

10 historical review of audits * *134 of the 145 HRSA audits have posted results 10

11 HRSA audits Risk-based factors related to selection include: > Number of outpatient facilities > Number of contract facilities > Complexity of the 340B program > Volume of 340B purchases > Parent sites in the program for more than 1.25 years are not subject to audit selection through risk-based factor Target audits focus on specific violations or allegations regarding diversion or duplicate discount 11

12 avoiding duplicate discounts Drug manufacturers cannot be subject to both the 340B discount and the Medicaid rebate. Hospitals dispensing outpatient drugs in a mixed-use setting must choose either a carve-in or carve-out policy to prevent double discounts carve-in Covered entities (CEs) decide they will use 340B-priced drugs for their Medicaid patients in the outpatient setting CEs must submit billing transactions with 340B acquisition prices for the drugs being dispensed carve-out Depending on the entity type, CEs decide they will use either wholesaler acquisition cost (WAC) or their GPO account for their Medicaid patients in the outpatient setting 340B drugs are only dispensed to non-medicaid outpatients Note: Contract pharmacies primarily exclude Medicaid and Medicaid Managed Care, unless under other arrangement with the state. 12

13 GPO exclusion DSH, children s and freestanding cancer hospitals are prohibited from obtaining covered outpatient drugs through group purchasing organization (GPOs) > The hospital should establish a non-340b, non-gpo (e.g., wholesale acquisition cost (WAC)) account for instances where drugs cannot be purchased using the hospital s 340B or GPO account > First purchase of any outpatient NDC should be made using a WAC account > CII narcotics 13

14 patient eligibility and diversion Anti-diversion requirements prohibit the resale or transfer of 340B outpatient discounted drugs to individuals not considered patients of the covered entity > This includes ineligible facilities and excluded services within the covered entity > The covered entity must consider: Mixed use settings Covered and non covered areas within same facility Inventory tracking systems and audit trails Security and theft risks 14

15 eligibility requirements Patient Has an established relationship with the CE, which maintains care records Receives an outpatient service from an eligible provider Excludes lab and diagnostic-only services Provider Employed by, or under contractual arrangement with, the CE Provides care to the patient Drug The drug is on the 340B list, limited to outpatient use and provided to an eligible patient Location The location is 340B eligible and above the line on the Medicare cost report Medicaid Carve-in or carve-out considerations 15

16 where GPO can be used > In the hospital s inpatient areas > In certain offsite outpatient facilities if the following criteria are met: Located at a different physical address Not registered on the 340B database The hospital maintains records demonstrating that drugs purchased through the GPO are not utilized or otherwise transferred to the parent hospital or registered outpatient facilities 16

17 Medicaid and duplicate discounts Review federal and state policy > Double-dipping occurs when a state seeks a Medicaid rebate on the same drug a manufacturer sold to a CE at a discounted price under the 340B program. Double-dipping prohibition puts onus on the CE and the state > OPA Medicaid exclusion files: CE must include provider numbers if they are billing Medicaid (carve-in) and the state must check file prior to applying for rebates. 17

18 contract pharmacy agreements Agreements should address all compliance elements suggested by HRSA > All contract pharmacies are registered with OPA and appear on the OPA website > The CE has the accountability for compliance with 340B program requirements > Patients are free to choose any pharmacy > Hospital is billed for 340B drugs shipped to contract pharmacy Contract pharmacy registration deadlines 10/15 for 1/1/14 listing 1/15 for 4/1/14 listing 4/15 for 7/1/14 listing 7/15 for 10/1/14 listing 18

19 Enforcing compliance with HRSA audits

20 what happens in a HRSA audit 20

21 OPA / HRSA audit components > Medicaid testing > Split-billing software review > Program registration review > Policies & procedures review > Adherence to the GPO prohibition > Interview of key hospital participants > Patient testing and tracking for eligibility > Program understanding and resource allocation 21

22 evaluating your 340B solutions Looking under the hood Reports Does your solution offer easy-to-assess reporting that can be set to run automatically? Audit tool Does your solution offer a built-in, easy-touse audit tool? Configuration options Does your solution offer multiple configuration options to meet the unique needs of your organization? Compliance / audit support team Does your vendor offer you support and a dedicated team to assist you and your consultants? 22

23 data required for audits Provider file 340B inventory Organizational chart 340B purchase orders Contract pharmacy listing with contracts 340B certification documentation Plus six months of drug data: > Drug > Payer > NCD number > Provider name > Unique ID number > Patient ID number > 340B acquisition price > Quantity dispensed or issued 23

24 Tailoring a compliance plan for your organization

25 fundamental elements Develop and adhere to policies and procedures that configure to vendor software Investigate and report detected offenses and develop an action plan Create an environment of open communication and information sharing Provide appropriate employee education and training Develop and follow through on enforcement of disciplinary standards Enlist senior leadership as part of your multidisciplinary compliance team Continue to demonstrate the community benefit that is a direct result of your 340B-generated savings 25

26 annual monitoring and auditing Perform an annual review of overall systems and a monthly sampling of dispensations > If using vendor software, learn how the solution is configured Does the configuration align with your organization s P&Ps? Some software vendors have tools and staff to assist you in self audits/mock audits and can provide training on their systems for your consultants. > Understand the reports available from your 340B vendor system, the information contained in them and the suggested frequency of review > Do not assume staff are accessing reports 26

27 340B compliance: it s everybody s business

28 responsibilities (HRSA website) To purchase drugs at the 340B price, covered entities must: > Prevent duplicate discounts > Prevent diversion to ineligible patients > Maintain auditable records documenting compliance > Keep 340B database information accurate and up to date > Register new outpatient facilities and contract pharmacies (if applicable) > Recertify eligibility every year > Not participate in a GPO for covered outpatient drugs (as applicable to particular CE) 28

29 stakeholder involvement 29

30 ongoing learning support Continually educate your internal resources on current federal and state policies Encourage annual and as-needed education, much like we do for HIPAA and other areas Make resources available including conferences, webinars, articles and reports Your state association 340B University SNHPA HMFA Others 30

31 references > 340B Drug Pricing Updates: Healthcare Accounting News healthcare-340b-drug-pricing-programupdates.htm > Program Integrity Audit Results: ty/auditresults/index.html > Orphan Drug List pdlisting/oopd/index.cfm OR ements/orphandrugexclusion/orphandru glist.pdf > Recertification Overview ements/recertification/index.html > Database Guide to Recertification A%20Database%20Guide%20for%20Publi c%20users%20-%20recertification.pdf > SNHPA 340B compliance checklist, last updated October 18, 2013: contact SNHPA at > Accountable vs Responsible ntability_vs_responsibility 31

32 thank you sentry data systems, inc. 800 Fairway Drive, Suite 400 Deerfield Beach, FL phone 2015 Sentry Data Systems, Inc. All rights reserved. No unauthorized reproduction. About Sentry Data Systems, Inc. We provide technology solutions that help hospitals address their three biggest challenges: reducing costs, managing compliance and producing better outcomes.