340B Rebate Models
HRSA has recently received inquiries from manufacturers related to different proposed rebate models for the 340B Program. HRSA continues to be in the process of reviewing these varied inquiries, which would significantly and unilaterally alter the administration of the Program. As HRSA has previously stated, implementing a rebate proposal without Secretarial approval would violate Section 340B(a)(1) of the Public Health Service Act.
Johnson & Johnson
On September 30, 2024, in response to HRSA’s recent communications which stated that HRSA considers implementation of an unapproved rebate model for the 340B Program as inconsistent with the 340B statute, Johnson and Johnson informed HRSA that it is ceasing implementation of its proposal at this time.
On September 27, 2024, the Health Resources and Services Administration (HRSA) sent a response to Johnson & Johnson's September 19, 2024, letter (PDF - 135 KB) regarding Johnson & Johnson's decision to proceed with implementation of an unapproved rebate proposal.
On September 17, 2024, HRSA sent a letter to Johnson & Johnson (J&J) (PDF - 192 KB) stating that HRSA expects J&J to cease implementation of its rebate proposal as it violates section 340B(a)(1) of the Public Health Service Act, which requires Secretarial approval of any such plan.
340B Program Compliance
In January 2024, HRSA created a new webpage to provide in one place the resources available to covered entities regarding HRSA audits to ensure compliance with 340B Program requirements. As HRSA noted on the webpage, HRSA Patient Definition Guidelines (PDF - 31 KB), published 25 years ago, contain HRSA’s interpretation of key statutory requirements and continue to guide HRSA’s audit activities. In the coming weeks and months, HRSA will be sending a series of audit findings to covered entities where we have identified potential areas of non-compliance with statutory requirements. Once complete, HRSA will post audit results on our public website.
340B registration requirements for off-site, outpatient hospital facilities
The Health Resources and Services Administration is releasing a Federal Register Notice (PDF - 236 KB) to inform and remind stakeholders of the registration requirements for off-site, outpatient hospital facilities to participate in the 340B Drug Pricing Program.
As part of the government’s efforts to respond to the unprecedented circumstances of the COVID-19 Public Health Emergency, HHS allowed various flexibilities across many of the Department’s programs, including the 340B Program. This included waiver of longstanding requirements that off-site, outpatient hospital facilities be (1) listed as reimbursable on the hospital’s Medicare Cost Report prior to participating in the 340B Program; and (2) registered and listed in 340B Office of Pharmacy Affairs Information System (OPAIS) prior to participating in the 340B Program. This waiver was available as of June 2020 only for off-site, outpatient facilities that would be listed as reimbursable on a future Medicare Cost Report.
The waiver was implemented in recognition of the need for hospitals to quickly respond to the rapidly evolving conditions of the COVID-19 pandemic and assist in creating efficiencies for hospitals to adjust operations in that response. For example, some hospitals moved clinics outside the four walls of a hospital building to expand capacity for care for patients with COVID-19 or transitioned certain clinic functions to meet the needs of the patients, such as by shifting an outpatient surgery center to serve as an urgent care or emergency room.
Pandemic conditions are no longer rapidly evolving in a manner that requires significant unplanned activities or changes by hospital covered entities to accommodate these exigencies. Additionally, HRSA program integrity efforts have demonstrated that the waiver has added risk and complexity to HRSA’s ability to effectively oversee compliance in the 340B Program. HRSA is issuing this Notice (PDF - 236 KB) to better address these risks.
The Notice (PDF - 236 KB) specifies that, in order to continue purchasing 340B drugs, covered entities’ offsite, outpatient hospital facilities must (1) be listed on the hospital’s most recently filed Medicare Cost Report and registered in OPAIS by the next 340B Program quarterly registration period, or (2) the covered entity must notify HRSA within 90 days of the publication of the Notice (PDF - 236 KB) that they have initiated the process of listing the offsite, outpatient facility on the hospital’s Medicare Cost Report and registering it in OPAIS. HRSA is providing a 90-day grace period before non-compliant entities may be subject to audit and compliance action.
If hospital covered entities have questions concerning the Notice (PDF - 236 KB), the hospital may contact the 340B Prime Vendor at [1-888-340-2787] (Monday - Friday, 9 a.m. - 6 p.m. ET) or apexusanswers@340bpvp.com
Guidance to 340B providers in Florida, Georgia, Louisiana, North Carolina, South Carolina, and Tennessee
Public health emergency declaration by the Secretary
We recognize that circumstances surrounding disaster relief efforts warrant flexibility for entities eligible for participation in the 340B Program. Therefore, eligible entities in Florida, Georgia, Louisiana, North Carolina, South Carolina, and Tennessee may immediately enroll for the 340B Program during the Public Health Emergency Declaration by the Secretary, rather than having to wait for the normal quarterly registration period. We believe this will enable these entities to meet the needs of the residents affected by these disasters.
Contact: If you are in the listed states and would like to enroll, email the 340B Prime Vendor Program or call 1-888-340-2787.