What is the Medicare 340B program?
What is the Medicare 340B program?
This month, the Supreme Court will hear a case involving the 340B Drug Pricing Program, which is designed to allow hospitals and clinics that treat low-income, medically underserved patients to purchase outpatient drugs at discounted prices.
Does 340B apply to Medicare?
This program extends front-end discounts on covered outpatient drugs to eligible facilities/covered entities. As of January 1, 2018, Medicare reimburses drugs purchased through the 340B Drug Program at a rate of the Average Sales Price (ASP) – 22.5%. …
What is 340B and how does it work?
The federal 340B Program is a drug price control program that allows qualifying providers, generally hospitals, specialty clinics and their associated outpatient facilities serving uninsured and low-income patients in rural communities, to purchase outpatient drugs from manufacturers at discounted prices.
How do patients qualify for 340B?
The prescription must be filled at one of the covered entities registered 340B pharmacies. There must also be no dual discounts, i.e. it cannot be paid for by Medicaid. The Patient. Must have an established relationship with health records maintained by the covered entity.
What are 340B acquired drugs?
The 340B Drug Pricing Program allows certain hospitals and other healthcare providers to purchase drugs and biologicals (other than vaccines) that are administered in a hospital outpatient department from drug manufacturers at discounted prices.
HOW DO 340B pharmacies make money?
Participation in the 340B program shifts a pharmacy’s profit source from dispensing spreads to per-prescription fees paid by a 340B-qualified entity. In some cases, the pharmacies share in the profits generated by 340B prescriptions, which raises further questions about who benefits from the program.
Is 340B only outpatient?
The 340B Program is an outpatient drug program. Enrolled covered entities have the responsibility to ensure that drugs purchased under the 340B Program be limited to outpatient use and provided to individuals who meet the requirements of the current patient definition.
Are all drugs 340B eligible?
According to the 340B statute, FQHCs (and other covered entities) may only provide 340B purchased drugs to individuals who are “patients” of the entity. As a result, policymakers often talk about the “patient definition” as the tool for determining eligibility for 340B drugs.
What is a contracted pharmacy?
1. What is a contract pharmacy? Health centers and other covered entities may choose to provide access to affordable medication to their 340B eligible patients by entering into a contract with an “outside” pharmacy – typically a pharmacy that is not owned or operated by the 340B covered entity.
Is 340B profitable to pharmacy?
The average profit margin on 340B medicines commonly dispensed through contract pharmacies is an estimated 72% compared with a margin of 22% for non-340B medicines dispensed through independent pharmacies.
Why is 340B bad?
Bad actors in the 340B program have realized that they can make substantial profits by buying deeply discounted cancer drugs, which are then reimbursed by Medicare and private insurers at full cost — providing hospitals with up to 100% profit margins on these expensive drugs.
Who is eligible for 340B pricing?
Only “outpatients” are eligible to receive prescription drugs at 340B discounted prices because the program is an outpatient program. In 1996, HRSA issued guidance for an individual to qualify as a patient of a 340B facility.
What is a 340B pharmacy program?
The 340B Drug Discount Program is a US federal government program created in 1992 that requires drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at significantly reduced prices.
Which prescriptions are 340B-eligible?
The Provider. They must be a federal grantee or non-profit organization contracted to provide services on behalf of the government.
What is 340B pricing program?
Passed by Congress in 1992, the 340B drug pricing program requires that pharmaceutical companies sell outpatient drugs to health care organizations at discounted rates.
