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HHS Withdraws Proposed 340B Drug Pricing Program “Mega Regs”

Monday, November 24, 2014  
Posted by: MPCA
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You may recall that back in April 2014, the U.S. Department of Health and Human Services (HHS) submitted to the White House Office of Management and Budget proposed 340B Drug Pricing Program regulations. Known as “Mega Regs,” the proposed regulations were never made public but were expected to address a variety of critical 340B Program issues. Last week, HHS withdrew its proposed “Mega Regs” and the Health Resources and Services Administration (HRSA) posted on its website that in 2015 it plans to issue and accept public comment on proposed guidance that will address key policy issues raised by various stakeholders. HRSA also posted that it is “planning to issue proposed rules pertaining to civil monetary penalties for manufacturers, calculation of the 340B ceiling price, and administration dispute resolution.”


Once HRSA’s proposed guidance is released, covered entities including Health Centers and Look-Alikes are encouraged to review the proposed guidance and be prepared to submit comments. Watch for more information and analysis by MPCA and NACHC.


Also on the horizon for the 340B Drug Pricing Program in 2015, as explained in a NACHC blog post, is an audit by the Office of Inspector General (OIG). The OIG included in its published workplan for fiscal year 2015 an assessment of the risk of duplicate discounts under 340B-purchased drugs paid through Medicaid managed care organizations and states’ efforts to prevent them. Per the NACHC blog post: “In particular, the OIG will assess whether existing tools and processes to prevent duplicate discounts under the Medicaid fee-for-service program are sufficient under managed care operations. While this review does not focus directly on Health Centers, as 340B eligible entities the results of the review could impact the way in which Health Centers account for certain 340B drugs. Further, when combined with the stated intention of the Office of Pharmacy Affairs to conduct an increased number of 340B compliance audits as well as the upcoming direct assessment of Health Centers’ compliance with 340B requirements, it is apparent that the 340B program in general will be facing increased scrutiny.”


The 340B Drug Pricing Program requires drug manufacturers to provide outpatient drugs to eligible health care organizations/covered entities at significantly reduced prices. Eligible health care organizations/covered entities are defined in statute and include HRSA-supported Health Centers and Look-Alikes, Ryan White clinics and State AIDS Drug Assistance programs, Medicare/Medicaid Disproportionate Share Hospitals, children’s hospitals, and other safety net providers. To participate in the 340B Program, eligible organizations/covered entities must register and be enrolled with the 340B program and comply with all 340B Program requirements. New registrations are accepted October 1-15, January 1-15, April 1-15 and July 1-15. The next 340B eligibility recertification period for FQHCs and Look-Alikes will be in February 2015.

Click here for more information about the 340B Drug Pricing Program.

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