September 1, 2015 Connie Ouellette, Principal Carole Barker, Senior Consultant THE LATEST ON THE 340B FRONT berrydunn.com
AGENDA Mega Guidance released! Audit update from HRSA Maintaining compliance Areas of audit risk HRSA and manufacturer audits 2
MEGA GUIDANCE RELEASED! HRSA 340B Drug Pricing Program Omnibus Guidance released in Federal Register, August 28, 2015 Proposed guidance at this time 60-day comment period 3
MEGA GUIDANCE Areas expected to be addressed: Patient definition Hospital eligibility Contract pharmacies Covered outpatient drug definition Medicaid Managed Care Reporting requirements HRSA delivered! 4
MEGA GUIDANCE - Definition of a Patient Current Definition CE has established relationship with individual Individual receives HC services from HC professional employed or under contract or other arrangement with CE Individual receives HC service consistent with grant funding or FQHC lookalike status CE = covered entity HC = health care Proposed Definition Facility or site registered for 340B program Provider is either employed or services billed by CE Drug is ordered or prescribed by CE provider as a result of service Individual s HC consistent with scope of grant, project, designation, or contract Billed as outpatient service Patient record accessible and demonstrates CE responsible for care 5
MEGA GUIDANCE - Covered outpatient drug definition Reaffirms limiting definition excluded if: The drug is provided as part of, or as incident to and in the same setting as the services listed (inpatient hospital, hospice, dental, outpatient hospital, NF or ICF, lab or xray, and renal dialysis services) And payment for drug is bundled. 6
MEGA GUIDANCE - Contract Pharmacies 2010 contract pharmacy guidance recommended annual audits Proposed guidance further clarifies expectations of this: Provides for regular review and reconciliation of eligibility and help prevent diversion Using an independent auditor Separate mechanism for at least quarterly comparisons of CE s 340B prescribing records with contract pharmacy s 340B dispensing records 7
MEGA GUIDANCE - Other Clarifications/Guidance No longer allow prescriptions written at inpatient discharge Clarify expectation on physician administered drugs (chemotherapy, transfusion) Exceptions to GPO statutory prohibitions for separate non- 340B sites 8
MEGA GUIDANCE - Other Clarifications/Guidance Explanation for any terminations to HRSA Notice and hearing process Record retention standard of not less than 5 years 9
MEGA GUIDANCE - HRSA Seeking Comment Alternatives to demonstrating eligibility of off-site outpatient facility or site Types of information CE could submit to demonstrate compliance to re-enroll Medicaid Managed Care alternatives 10
WHAT ISN T IN THE GUIDANCE Discounted prices for uninsured patients Additional reporting on use of savings Limit on number of contract pharmacies Clearly addressing refills Materiality 11
AUDIT UPDATE from HRSA Panel of HRSA auditors at the 340B Coalition Annual Conference Areas of focus: Eligibility Duplicate discounts Diversion Risk-based audits (vs. target-based audits) 2015 YTD # of audits Frequency of audits 12
HRSA AUDITS 70% 60% 50% 40% 30% 20% HRSA AUDIT SANCTIONS No Sanctions Repay Manufacturers Remove Contract Pharm Other 10% 0% 2012 (51 Audits) 2013 (93 Audits) 2014 (93 Audits) 2015 (65 Audits) 13
HRSA AUDIT RECOMMENDATIONS Pre-audit prep: In the words of HRSA, relax Follow instructions HRSA available for questions Onsite: Permitted staff Know your program Provide access HRSA will not provide guidance HRSA will not provide results 14
TRUE OR FALSE? A covered entity is prohibited from self-disclosing a material compliance problem if it is undergoing a HRSA audit? A covered entity is only required to initiate corrective action if the non-compliance is material? 15
MAINTAINING COMPLIANCE Have a robust compliance plan Establish internal controls 340B Oversight Committee Educate Perform regular internal audits Targeted audits if needed Findings and Corrective Action Plan (CAP) Materiality 16
GOOD TIPS Don t wait for an audit Don t assume anything External audits get some If audited, be mindful of scope-creep 17
AREAS OF RISK Site registration Diversion prevention Duplicate Discounts Contract Pharmacies Documentation Other (GPO, Orphan drugs) 18
AREAS OF RISK Types of Findings Result in: Repayment to Manufacturer Removal from program Inaccurate database record Diversion X? Duplicate discount X? Eligibility Failure to maintain records X X X X 19
AREAS OF RISK Site registration Does your registration on the OPA database match your 340B Program operations? 20
AREAS OF RISK Diversion Are your software interfaces between systems mapped appropriately and maintained on a regular basis? EMR Patient Billing Inventory Contract Pharmacies Do your medical records properly document prescriptions, medications and place of service? 21
AREAS OF RISK Duplicate Discounts Are your records in the Medicaid exclusion file correct? If your contract pharmacies carve in did you notify HRSA? 22
AREAS OF RISK Contract Pharmacies Do you have a signed contract that meets HRSA requirements? Do you have auditable records that show proof of contract pharmacy oversight? 23
AREAS OF RISK Documentation Do you have written policies and procedures? Do the policies and procedures define your 340B operations? Do you have auditable records that show 340B program oversight? Who is responsible for compliance of the 340B program? 24
HRSA AUDITS WHAT DOES THE TIMELINE LOOK LIKE? Pre-audit 4 weeks or longer Audit 1-3 days Audit follow-up Final audit report Up to 6 months 30 days to challenge findings If accept findings or have unsuccessful appeal, 60 days to submit a CAP Public letter to manufacturers 2 nd audit if repayment finding 25
MANUFACTURER AUDITS WHAT YOU NEED TO KNOW Manufacturer can audit you for diversion or duplicate discounts Looking for unusual purchasing trends (Be prepared to provide explanations, document) Audit plans are approved by OPA HRSA encourages collaboration between CE and manufacturer 26
CORRECTION ACTION PLAN - REQUIRED ELEMENTS How problem has been fixed Process to ensure it doesn t happen again Implementation date Responsible individual Education strategy 27
REPAYMENTS Key Tips: Get approval before issuing refunds Be transparent Provide complete information (see sample) How to get WAC pricing Benefits of credits and rebills vs. AP check Time-barred or waiver responses frowned upon 28
RESOURCES Apexus Questions 1-888-340-2787 Apexusanswers@340Bpvp.com Templates Education - 340B University 340B Health HRSA 29
INTERESTED IN MORE? We are always available for your questions cbarker@berrydunn.com couellette@berrydunn.com berrydunn.com