Up to a third of hospitals currently participating in the 340B drug-pricing program say they would consider opting out if proposed regulatory changes are finalized, a leading advocacy group said on Wednesday.
More than a quarter of the 2,100 hospitals that participate in the drug-discount program would be significantly affected by the provisions included within the Health Resources and Services Administration's draft omnibus guidance released in August, according to the advocacy group 340B Health.
CEO Ted Slafsky said a survey of its 1,100 members found 29% of them would drop out of the 340B program if the draft guidance was finalized as it currently is written.
At issue are new provisions that critics feel narrow the definition of an eligible outpatient under the program.
Of particular concern is a proposed ban on allowing patients to receive prescription medications under 340B upon their discharge from a hospital. A provider would be required to make a subsequent outpatient appointment to obtain the discount.
Infusion drugs for hospitalized cancer patients would be ineligible in cases where the patients get prescriptions for treatment outside of the participating hospital. Some outpatient drugs provided in the emergency department would also be ineligible for 340B discounts.
Proposed changes to billing requirements would ban physicians from ordering 340B drugs if they only have admitting privileges or credentials with a participating hospital. Slafsky said that would automatically ban providers located in states where hospitals can't bill for physicians services.
The public comment period on the proposed rule ended Tuesday night, with providers such as Johns Hopkins Medicine asking HRSA to take out some of the provisions, or allow for a 12-month delay before the rules go into effect so that hospitals can make the necessary adjustments.
340B Health Senior Vice President Lisa Scholz said the changes proposed in the guidance would affect an estimated 80% of the hospitals the group surveyed, with cost-saving losses as high as 20%.
Todd Ebert, CEO of the Healthcare Supply Chain Association, also wrote a letter saying his group supports the exceptions made for hospitals that use group purchasing organizations to obtain outpatient drugs.
"We believe HRSA should amend 340B's GPO prohibition to reasonably expand exceptions to the prohibition, clarify violations to the prohibition, and clarify the time period for which covered entities must make repayments to manufacturers. Doing so will further enable covered healthcare providers to effectively serve eligible patients without undue difficulties," Ebert's letter stated.
Hospitals saved an estimated $3.8 billion on outpatient drugs in fiscal 2013 through the program, according to HRSA. A report released in May by the Medicare Payment Advisory Commission estimated 340B hospitals on average receive a minimum discount of around 23% on drug prices.
Congress created the 340B drug-pricing program in 1992 to help hospitals that serve disproportionately large numbers of low-income patients. The program, which was expanded under the Affordable Care Act, has seen a stark rise in the number of covered organizations over the past decade. One-third of all hospitals now participate, and the Government Accountability Office has estimated that 40% of hospitals are eligible.
According to MedPAC, the 340B-covered entities spent more than $7 billion on drugs under the program in 2013, three times what was spent in 2005.
The draft guidance is expected to be finalized sometime in the coming year.
