340B Drug Pricing Program; Administrative Dispute Resolution Process – Notice of Proposed Rulemaking Summary
On November 30, 2022, the 340B Drug Pricing Program; Administrative Dispute Resolution Notice of Proposed Rulemaking (NPRM) was published in the Federal Register (PDF - 315 KB). Section 340B(d)(3) of the Public Health Service Act requires the establishment of an Administrative Dispute Resolution (ADR) process for certain disputes under the 340B Program. Under the statute, the ADR process is designed to resolve:
- Claims by covered entities that they have been overcharged for covered outpatient drugs by manufacturers; and
- Claims by manufacturers, after the manufacturer has conducted an audit of a covered entity, that a covered entity has violated the prohibition on diversion or duplicate discounts.
This NPRM proposes new requirements and more efficient procedures to make the 340B Program's ADR process more accessible and efficient, including ensuring that ADR panels hearing disputes are comprised of subject matter experts on the 340B Program, and establishing an independent HRSA reconsideration process. The NPRM will be open for public comment through January 30, 2023. Please refer to the Federal Register (PDF - 315 KB) publication for instructions about how to submit comments.
Implementation of Section 121 of the Consolidated Appropriations Act of 2022
The Consolidated Appropriations Act of 2022 was signed into law on March 15, 2022. Section 121 of the law permits certain hospitals to be reinstated into the 340B Drug Pricing Program if they meet the following conditions:
- The hospital must be classified as a:
- Disproportionate share hospital,
- Sole community hospital,
- Rural referral center,
- Children's hospital, or
- Free standing cancer hospital.
- The hospital must have been terminated from the 340B Program due to an inability to meet the statutorily-required disproportionate share adjustment (DSH percentage) during Medicare cost reporting periods beginning October 1, 2019 and ending no later than December 31, 2022.
- The hospital's termination must have been as a result of actions taken by or other impact on the hospital in response to, or as a result of, the COVID-19 Public Health Emergency (PHE).
- The hospital must have been a covered entity on January 26, 2020 (i.e., the day before the first day of the COVID-19 PHE).
If you believe that your hospital may be eligible for this exception and have not yet been contacted by HRSA, please contact the 340B Prime Vendor at 1-888-340-2787 (Monday – Friday, 9 a.m. – 6 p.m. ET) or firstname.lastname@example.org. Requests will be evaluated on a case-by-case basis.
Statement From the Health Resources and Services Administration Regarding Recent Court Rulings Involving the 340B Program
We are pleased that two of three recent U.S. District Court opinions involving the 340B Program agree with HRSA that three pharmaceutical manufacturers have unlawfully restricted access to 340B discounted drugs by covered entities that dispense medications through contract pharmacy arrangements – the core finding of HRSA's May 17, 2021, Violation Letters. HRSA respectfully disagrees with the recent District Court opinion finding that two other manufacturers had not violated the statute, and continues to evaluate its options.