Both supporters and critics view the release of the long-awaited 340B guidance as a much-needed step toward clarifying the ambiguity surrounding the discounted drug pricing program. Many providers feel that lack of clarity has fueled a perception that the program can be exploited.
But further review of the 90-page guidance document has worried stakeholders who think the proposed rules could limit patient access to the program while adding an extra administrative and clinical burden for hospitals.
The 340B Drug Pricing Program requires drugmakers to provide discounts of 20% to 50% to hospitals and clinics for certain outpatient drugs as a condition of eligibility for Medicaid reimbursement.
Alyce Katayama, a partner at the law firm of Quarles & Brady, said the draft guidance released by the Health Resources and Services Administration prevents non-covered healthcare organizations from prescribing discounted drugs for patients referred to them by providers covered under the program.
She added that, in some ways, the agency has altered previous information it provided, adding to the ambiguity.
“Now that we have this insight as to where HRSA might go with the guidance, I think it's just going to put everyone in limbo until it is finalized,” Katayama said. “People will be concerned about what they're doing; people who might have wanted to implement new programs will put those plans on hold because they don't know how this thing will turn out.”
Other conditions placed on the definition of a 340B-eligible patient include requiring that an employed staff member for a covered entity provide care for that patient. That prohibits physicians or caregivers from prescribing drugs under the program if they have an arrangement where they have privileges or credentials only with a 340B hospital.
“There definitely are some provisions in the guidance that appear to be restricting hospitals' ability to use the program and potentially in large ways,” said Beth Feldpush, senior vice president of policy and advocacy for America's Essential Hospitals, the leading advocacy organization for safety net providers.
Another point of concern comes from a provision that prohibits hospitals from prescribing 340B drugs to inpatients upon their discharge, instead requiring them to make an outpatient appointment before their prescription is eligible under the program.
Feldpush said such requirements could place undue burdens on hospitals and cost time and money.
“The 340B program is very administratively complex and costly to administer now,” Feldpush said. “I could see where if HRSA narrowed the program, a hospital could say the costs to run this program may outweigh (the benefit of) participation in it.”
Debate over 340B program reforms has increased in recent years as the number of organizations in the program has grown. Critics, including the Pharmaceutical Research and Manufacturers of America, have accused the program of allowing some providers to participate despite serving a relatively small proportion of low-income patients.
One-third of all hospitals now participate, and the Government Accountability Office has estimated as many as 40% are eligible.
Lori Reilly, PhRMA's executive vice president of policy and research, said the organization was “pleased” with HRSA's effort, calling it a “step forward” toward providing clarity on the program.
“PhRMA has long maintained the 340B drug discount program should be targeted to true safety net hospitals and the recipients of federal grants, which rely on the program to serve vulnerable patients,” Reilly said. —Steven Ross Johnson
