THE PHS 340B DRUG PRICING PROGRAM: An Introduction

1
THE PHS 340B DRUG PRICING PROGRAMAn
Introduction

• Zandra M. Glenn, Pharm D
• Program Development Consultant
• HRSA Pharmacy Services Support Center

2
The Plan

• Background
• 340B Basics
• Getting Started
• Pharmacy Service Options
• Getting Help
• Questions?

3
Background The Uninsured

• 49 million Americans without health insurance in
  2002
• 23 of Americans under 65 have no prescription
  coverage
• 10 of seniors eligible for Medicare Part D have
  no prescription coverage (4 to 5 million people)
  

4
Medication Access Strategies

• Medication Samples
• Patient Assistance Programs
• Drug Discount Cards
• Discounted Retail Pricing
• Bulk Donation/Purchasing
• Pharmacy Benefit Management
• 340B Drug Pricing Program

5
The PHS 340B DrugPricing Program

• Established in 1992
• Provides discounts on outpatient drugs to covered
  entities
• Manufacturers that participate in Medicaid must
  also sign an agreement to participate in 340B
  Drug Pricing Program

6
Office of Pharmacy Affairs

• Administer the 340B program
• Promote access to comprehensive pharmacy services
• Develop innovative pharmacy service models
• Provide program technical assistance
• Serve as a Federal resource for pharmacy practice
• Website www.hrsa.gov/opa

7
340B Basics

• Benefit for Covered Entities
• Covered Entities include
• Nations core of safety net providers
• Federal Grantees
• Some Non-Grantees

8
Federal Grantee Covered Entities

• Community health centers
• Migrant health centers
• Health centers for public housing
• Health centers for homeless
• AIDS clinics and drug purchasing programs
• Black lung clinics

9
Federal Grantee Covered Entities

• Hemophilia treatment centers
• Native Hawaiian health centers
• Urban Indian clinics/638 tribal centers
• 340s school-based programs
• Title X family planning clinics
• STD clinics
• TB clinics

10
Non-grantee Covered Entities

• Federally Qualified Health Center Look-alikes
• Certain Disproportionate Share Hospitals

11
Why 340B?

• Reduce prescription drug expenditures by safety
  net providers in order to
• Expand health services access to
• Low-income individuals/families
• Vulnerable populations
• Reduce taxpayer burden
• Average savings 25-50 for covered medications
  (NACHC Survey)
• Comprehensive Pharmacy Services

12
Estimated Prices For Selected Public Purchasers,
as Percent AWPvon Oehsen Pharmaceutical
Discounts Under Federal Law State Program
Opportunities
0
20
40
60
80
100
100.0
AWP
80.0
AMP
67.9
Medicaid (Min.)
60.5
Medicaid Net
51.7
FSS
Private Sector Pricing
49.0
340B
47.9
FCP
34.6
VA Contract
Stephen Schondelmeyer, PRIME Institute,
University of Minnesota (2001)
13
340B Basics Requirements and Prohibitions

• Definition of a patient
• Established relationship with covered-entity
• Care from employed or contracted provider
• Services provided consistent with funding
• Resale or transfer
• Audits and record keeping
• Group purchasing discounts
• Prohibition of Double Dipping

14
Getting Started

• Determine entity eligibility
• Fill out entity participation form
• Assess program components
• Determine pharmacy service option
• Contact Prime Vendor

15
Determining Entity Eligibility

• Federal funding source
• Check the database at www.hrsa.gov/opa
• Scope of service issues

16
Participation Form

• Finding the form
• At www.hrsa.gov/opa
• Click on Introduction to 340B
• Completing the form
• Medicaid question
• Deadlines
• Dec. 1, Mar. 1, June 1, Sept. 1

17
Assessing Program Components

• Formulary management
• Samples
• Patient assistance programs
• Pharmacy service option
• In-house
• Contract
• Other

18
Contract Pharmacy Services

• Entity contracts with one pharmacy per site
• Entity purchases and owns medications
• Ship to, bill to arrangement
• Detailed receiving/dispensing records
• Diversion prevention tracking system

19
In-house Pharmacy Services

• Traditional
• Owned and operated by Entity
• Management Company Operated
• Owned by Entity
• Managed under contract

20
Other Options

• Provider Dispensing
• Telepharmacy
• Mail Order
• Alternative Method Demonstration Project

21
Alternative Method Demonstration Projects

• HHS Secretary approved in June 2001
• Goal is to demonstrate and evaluate new methods
  of accessing 340B drug discounts to serve greater
  numbers of indigent and uninsured people
• Non-funded projects
• No application deadlines/funding cycles

22
Alternative Method Demonstration Models

• Covered-entity network
• Multiple contracted pharmacies
• Contracted pharmacy supplement to in-house
  pharmacy

23
Alternative Method Project Proposal

• Review information at www.hrsa.gov/opa
• Submit proposal to OPA
• Proposal should include
• Need
• Description of method
• Methods of evaluation
• Participating entities
• Duration
• Inventory control and dispensing
• Compliance with 340B statutory and program
  requirements
• Drug diversion
• Additional requirements by model type

24
Accessing the 340BProgram Pricing
Prime Vendor
25
Prime Vendor Program

• Improve access to affordable medications for
  covered entities and their patients
• Primary goals
• Educate and market the advantages of the PVP to
  eligible covered entities, suppliers, and drug
  wholesalers
• Lower participants supply costs by expanding the
  current PVP portfolio of sub-340B priced products
  
• Provide covered entities with access to efficient
  drug distribution solutions to meet their
  patients needs
• Provide access to other value added products and
  services meeting covered entities unique needs

26
340B Implementation Issues

• Financial capital and risk
• Expertise available
• Timeline requirements
• Operational control
• Physical space
• Staffing resources

27
Getting Help The Pharmacy Services Support Center

• Established September 2002
• Contract between HRSA and the American
  Pharmacists Association
• Harry Hagel, RPh, MS
• Senior Director
• Facilitate development of clinical and
  cost-effective pharmacy services

28
PSSC Improving Access to Pharmacy Services

• Organize and manage information
• Promote value of pharmacy services
• Support programs to enhance access
• Manage technical assistance program

29
PSSC Technical Assistance

• Team of consultants with knowledge and experience
  in clinical and cost-effect pharmacy services in
  340B entity settings.
• Assistance provided on-site, by phone or via
  e-mail.
• Larry Brandt, Coordinator

30
PSSC Contact Information

• Phone [phone]
• E-mail pssc_at_aphanet.org
• Web http//pssc.aphanet.org

31
Questions or Comments