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Understanding the 340B Program: Key Insights and Case Study from Louisiana Oncology Society

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This session presented by Lane Hooton, COO of Cancer Centers of Southwest Oklahoma, explores the 340B Drug Pricing Program, its significant impact on healthcare organizations, and its requirements. It highlights definitions of the 340B and Prime Vendor Programs (PVP), who can participate, and the benefits for Disproportionate Share Hospitals (DSH). Using a case study from Oklahoma, the presentation examines how 340B can expand cancer care services while emphasizing eligibility criteria for patients and facilities. Join us to understand the financial implications and operational advantages of the 340B program.

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Understanding the 340B Program: Key Insights and Case Study from Louisiana Oncology Society

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Presentation Transcript

  1. 340 B Program and a Real World Case Study Louisiana Oncology Society November 29,2010 Lane Hooton ,Chief Operating Officer Cancer Centers of Southwest Oklahoma

  2. Objectives • Define the 340B Program • Define the Prime Vendor Program(PVP) • What organizations can access 340B/PVP? • What are the key requirements for the above? • How does 340B/PVP impact a business?

  3. Background • 1992 -Section 602 of Public Law 102-585, the “Veteran’s Healthcare Act” enacted Section 340B of the PHS Act • Manufacturers sign agreement with Secretary of Health and Human Services to cap prices • Section 340B is commonly referred to as the 340B Program, Section 602, or PHS Act

  4. Program Administration • Office of Pharmacy Affairs (OPA) http://pssc.aphanet.org • Pharmacy Services support Center (PSSC) http://hrsa.gov/opa • 340 B Prime Vendor Program (PVP) www.340Bpvp.com

  5. Prime Vendor Program(PVP) • 340b PVP provides additional savings to Disproportionate Share Hospitals • Mission is to improve access to the program • Participation is free for all eligible 340B participants • Contract to mange PVP is through Apexus Inc. • 13 national, regional specialty distributors • PVP adds approximately 2% to the overall discount

  6. What’s covered and why the big deal? • Outpatient prescriptions • OTC written by Rx • Clinic Administered drugs in eligible facilities • ER drugs • Drugs in other ambulatory settings (i.e. day surgery) • Not Covered- inpatient drugs, vaccines

  7. And the big deal is….? • DSH savings range from 22-40% less than any GPO • Average discount in oncology and using PVP is 27% • Only price lower is VA

  8. So who can access this program? • Family planning projects • Entities covered under the Ryan White Act • State operated AIDS programs • Black lung clinics • Hemophilia clinics • Native Hawaiian clinics • Urban Indian organizations • Disproportionate Share Hospitals (DSH)

  9. Facility Eligibility • Hospital owned or operated by unit of state or local government • Public or private NFP contracted with government to provide healthcare to low income individuals • DSH adjusted charity rate > 11.75%

  10. Patient Eligibility Requirements • 340B prohibits selling or transferring drugs to/for any patient not a patient of the covered entity • individual is a patient if entity owns or controls that person’s healthcare records • Individual must receive care from a provider either employed or under contract to the entity • Mere act of dispensing to a patient is not enough to establish the relationship

  11. Patient Requirements continued.. • Must be for an outpatient service • Provider is to be on the hospital’s CMS cost report • Others- common medical record, employed physicians, common protocols, common board of directors, QA processes

  12. Case Study-Cancer Centers of Southwest Oklahoma • Three hospitals in three markets • Build three new centers to expand/provide cancer care • Only one of three hospitals is DSH • Medical, Radiation Oncology, Lab in each • One Board of Directors • Private and employed doctors • New EMR for all

  13. Problem/Solutions-use 340B in all sites • Two hospitals are not DSH • Definition of a patient: • Outpatient • Employed physicians • Covered entity maintains medical record • First dose at covered entity

  14. So, what’s the financial impact?

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