340B. Simplified.

1. 340B. Simplified.

2. Defining 340B • Created in 1992 to: • Expand access to affordable medications for low-income patients • Enable hospitals to stretch their resources to provide more comprehensive care for the uninsured population • Eligibility: • Entities (must be non-profit) • Federally Qualified Health Centers, Disproportionate Share Hospitals, Critical Access Hospitals, Children’s Hospitals and others • Medications • Outpatient drugs only • Patients • Only patients of covered entities • Oversight Responsibility: • Health Resources and Services Administration (HRSA) • Office of Pharmacy Affairs (OPA)

3. The SUNRx 340B Solution Plan Design Complete 340B ManagementSolution VirtualInventoryManagement Reporting &Compliance Program Marketing Contract Pharmacies Plan Design PatientEligibility

4. Patient Definition • HRSA Patient Eligibility • The covered entity has established a relationship with the individual, such that: • The entity maintains records of the individual's health care • The prescriber is either employed by the covered entity – OR • The prescriber provides health care under contractual or other arrangements(e.g., referral for consultation) • The responsibility for the care remains with the covered entity • Outpatients Only

5. Data Elements Obtained to Determine Eligibility • SUNRx will identify the hospital’s outpatient (OP) service areas that are on the Medicare Cost Report—used to code the VI system. • Eligible Service Areas • SUNRx will establish a real-time feed of the hospital’s ADT system to document patient visits to the hospital. • Eligible Events • SUNRx will assign the script an appropriate capture time frame based on the establishment of an Eligible Event (i.e., one year) and the provider type. • Eligible Timeframe • SUNRx will obtain a list of hospital providers who are classified as employed, contracted or credentialed, and determine their exclusivity to the hospital. This determination will be used to define SUNRx’s prescription capture rules. • Eligible Providers • Eligible Pharmacy • SUNRx will obtain data on all prescriptions filled for hospital patients at the contract pharmacy (either retrospectively or in real time.)

6. Contract Pharmacies • Hospitals may set up a contract pharmacy network to serve their patients: • Contract pharmacies (all types) supplement your outpatient pharmacy • Convenient pharmacy locations to expand access to the Self-Pay population • Working with a pharmacy chain will create efficiencies and greater access • Pharmacy Contracts • Serves both cash and third-party patients • Paid a dispensing fee (prefer fixed), and drugs are “replenished” by the hospital (bill-to, ship-to) • Strict diversion and inventory control management

7. How it Works: Prescription Processing CashClaims • Adjudicate toMedImpact / SUNRx Savings • Adjudicate to third-party PBM • Capture claims • Confirm eligibility • Adjudicate to MedImpact/SUNRx • Determine eligibility • Loaded 340B • Network • U&C • Confirm lowest cost Real-time Claims Processing Contract Pharmacy Retrospective Claims Processing Covered Entity Third-partyClaims Opportunity

8. Third-party Benefit Example Net Benefit for Hospital Third-partyReimbursement Net Benefit Copay

9. 340B Virtual Inventory

10. 340B Facility and Pharmacy Registration • HRSA registration periods: • New covered entities • Off-site facilities • Contract pharmacies Registration PeriodStart DateOctober 1st – 15th January 1January 1st – 15th April 1April 1st – 15th          July 1July 1st – 15th            October 1 Implementation Timeline Q2 Q1 Implementation Period (75 days) Contract the Pharmacies (30 days) HRSA Active Date HRSA Registration Period (15 days) Wholesaler Setup (60 days) 150 days Minimum (Up to 210 days)

11. 340B Guidance • HRSA Audits • HRSA conducts audits to assure entities are: • Preventing diversion of 340B Drugs (use only for eligible patients) • Preventing duplicate discounts (Medicaid rebate + 340B discount) • Maintaining readily auditable records • Adhering to the GPO and Orphan Drug Exclusions • Internal Audits • HRSA expects entities to perform annual “independent” 340B audits • Self Audits—random audits of contract pharmacy claims • Self-Reporting of program violations to HRSA • Annual Facility Recertification—Entities should: • Assure that contact information is up to date on the HRSA website • Make sure OP facilities are registered with HRSA • Facilities are on their Medicare Cost Report • Contracts are in place and annual audits are conducted

12. Helpful Self-Audit Information • 340B Audit information https://www.340bpvp.com/content/contentSearch.html?category=content&Ntt=audit • Sample Self-Audit Process for Rural Hospitals https://docs.340bpvp.com/documents/public/resourcecenter/RuralHospital_340B_Compliance_SelfAssessment_DataTransactions.pdf • Sample Self-Audit Process for DSHs https://docs.340bpvp.com/documents/public/resourcecenter/DSH_340B_Compliance_SelfAssessment_DataTransactions.pdf

13. Monitoring and Compliance Compliance Reporting • Every transaction should be tracked, creating a fully auditable records: • Eligibility • Medication dispensing history • Reversals, re-bills • Replenishment orders • Pharmacy Receipts • Program Performance Monitoring: • Captured claims by pharmacy • Program utilization • Financial performance Dashboard Monitoring

14. Maintenance of Auditable Data • Eligible patients • Eligible events at the hospital • Eligible providers (by type) • Captured claims from eligible pharmacies • Reviewed and accepted ICD-9 matched claims • Wholesaler orders placed for drug, at each contract pharmacy • Pharmacy receipt of replenished drug • Documentation of all “blocked” Medicaid claims • Results of financial reconciliation

15. Important websites • 340B Prime Vendor Program (Apexus) • https://www.340bpvp.com • Office of Pharmacy Affairs • http://opanet.hrsa.gov/OPA/Default.aspx

16. Searching for Covered Entity

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18. Marketing Your Program

19. Re-Investing Resources • Build clinics to help serve the indigent population • Fully supporting Free Clinic that lost federal funding (savings passed along to patients) • Maintain patient assistance program which includes subsidy for discharged script from ER (designated time frame) • Programs that bring care to the patients which is essential to health (patient has minimal means to travel) • Contract with pharmacies in remote areas that provide home delivery to patients at no additional cost • Increase in discussions around full subsidy indigent programs