Given the significant implications for all 340B Program stakeholders, HRSA will be actively seeking formal comments on proposed Omnibus Guidance before it is finalized and.The proposed Omnibus Guidance is expected to be made publicly available in proposed form for notice and comment later this year, likely sometime between June and the end of this federal fiscal year (prior to October 1, 2015).HRSA plans on releasing a tool making 340B Ceiling Prices (defined below) available to Covered Entities by late 2015.Finally, we provide a high-level summary of the Subcommittee testimony and question-and-answer session before contemplating the practical effects that the hearing may have on participating 340B Program manufacturers and Covered Entities.Īt a high level, the Subcommittee testimony yielded the following insights: We then provide a brief overview of the 340B Program and discuss some of the major outstanding implementation issues likely to be addressed in the Omnibus Guidance. In discussing the implications of the Subcommittee hearing below, we first detail the major 340B Program stakeholder takeaways. These issues include “Eligible Patient” definition clarity, possible contract pharmacy implementation limitations, acquisition cost reporting requirements and non-governmental hospital eligibility requirements.
The testimony took place in front of the United States House of Representatives Committee on Energy and Commerce Subcommittee on Health (the “Subcommittee”) and produced some interesting insights addressed in greater detail below.Īlthough some notable insights arose out of the hearing, 340B Program stakeholders including both manufacturers and purchasing Covered Entities (defined below) will ultimately need to wait until HRSA’s eagerly anticipated comprehensive 340B Program guidance (“Omnibus Guidance”) is released later in 2015 for actionable guidance regarding key 340B Program issues. It will also review “best practices” for covered entities participating in the 340B Program to evaluate risks and compliance with these elements.On Tuesday, March 24, 2015, representatives from the Government Accountability Office (“GAO”), the Department of Health and Human Services Office of the Inspector General (“OIG”) and the Health Resources Services Administration (“HRSA”) testified regarding the drug discount program authorized by Section 340B of the Public Health Services Act (“340B Program”).
This program will address key elements of 340B Program participation that are regulated outside of the 340B Program and the 340B Statute, the intersection of these elements with the 340B Program, and 340B covered-entity compliance obligations and enforcement consequences. Participation in the 340B Program also requires an understanding of the related, but non-340B, federal and state laws, as well as oversight by and allocation of legal and compliance resources. Many elements of participation in the 340B Program and decisions related to 340B Program operations do involve federal or state funds or other compliance requirements regulated by entities other than the 340B Program. However, participation in the 340B Program carries more risks than only those that arise under the 340B Statute.
Therefore, participation in the 340B Program is often viewed by participating entities as low-risk, with compliance oversight resources allocated accordingly and often delegated to pharmacy staff. The 340B Program does not involve payment of federal (or state) funds to participating entities, is not considered a “federal health care program” subject to the False Claims Act, and enforcement tools available to the government are limited.
The 340B Program has gained national attention over the last decade, in part due to the opportunities it provides to generate revenue for participating entities without risk of significant enforcement penalties for non-compliance.
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