FAQs

Covered entities should refer to the 340B statute, HRSA published guidance, and HRSA policy releases to confirm the accuracy of 340B policy. HRSA establishes 340B policy and communicates via policy releases, its website and through email communication. In addition, HRSA uses the HRSA contracted 340B Prime Vendor Program to assist in communicating that policy.

Covered entities that are either unsure of past HRSA guidance or information received beyond HRSA or the Prime Vendor should contact the Prime Vendor’s Answers Call Center to validate the information. Covered entities should also use their own legal counsel to assist in ensuring compliance with 340B program requirements. Liability for compliance with 340B program requirements resides with the covered entity.

The 1994 guideline (59 Fed. Reg. 25110 (May 13, 1994)) states that “manufacturers may not single out covered entities from their other customers for restrictive conditions that would undermine the statutory objective” and that “manufacturers must not place limitations on the transactions (e.g., minimum purchase amounts) which would have the effect of discouraging entities from participating in the discount program.” This policy is consistent with section 340B(a)(1) of the Public Health Service Act which requires manufacturers to “offer each covered entity covered outpatient drugs for purchase at or below the applicable ceiling price if such drug is made available to any other purchaser at any price.” HRSA has also provided additional information that 340B providers are treated the same as non-340B providers (Clarification of Non-Discrimination Policy. Release No. 2011-1.1 (May 23, 2012)). Therefore, in the case of specialty distribution, manufacturers must ensure that they are not discriminating against 340B providers and that other non-340B providers are also going through the specialty distribution channel. In addition, the manufacturer must always ensure they are providing the drug at or below the ceiling price. Manufacturers should work with HRSA regarding specialty distribution channels to ensure compliance and to ensure that entities are aware of the appropriateness of the distribution channel in order to be transparent and limit any disputes.

No. 340B pricing applies to covered outpatient drugs only.

Section 340B(a)(8) of the Public Health Service Act requires the establishment of a prime vendor program (PVP). The purpose of the PVP is to develop, maintain and coordinate a program capable of distribution, facilitation and other activities in support of the 340B Program. The PVP is a voluntary program for 340B covered entities and serves its participants in three primary roles:

1.Negotiating sub-340B pricing on pharmaceuticals;
2.Establishing distribution solutions and networks that improve access to affordable medications; and
3.Providing other value-added products and service.

All covered entities may participate in the PVP including hospitals that are prohibited from purchasing in a group purchasing arrangement.

HRSA considers the 340B ID the unique identifier. While HRSA does not use Health Industry Numbers (HIN) as a method of identifying 340B covered entities, we recognize that HIN and DEA numbers may be used by certain stakeholders, in addition to the 340B ID, to operationalize the 340B Program.

Covered entities should always ensure they are adhering to all federal, state, and local laws. Covered entities contracting with pharmacies to dispense 340B drugs should be aware of the federal anti-kickback statute and the way in which such requirements could apply to their arrangements with contract pharmacies. Cases of suspected violations of the anti-kickback statute should be directly referred to the Office of the Inspector General (OIG) who oversees this provision. The OIG can be reached at:

Online, Phone: 1-800-HHS-TIPS (1-800-447-8477) Fax: 1-800-223-8164

*Note: While you may remain anonymous, in order to accept submissions for review via facsimile, the OIG Hotline requires a complaint to include a formal cover letter or the use of the downloadable complaint submission form, available

Hotline Complaint Submission Form (PDF - 34 KB)

Hotline Complaint Submission Form (MS Word - 178 KB)

TTY: 1-800-377-4950

The 340B Prime Vendor Program, as part of its agreement with HRSA, provides online tutorials, templates, and other tools to aid in educating and informing 340B Program stakeholders about the program. Specifically, the 340B Prime Vendor offers educational programs, including 340B University and 340B University OnDemand . They also operate a call-center and have a database of FAQs. These educational materials have been reviewed and approved by HRSA. Please visit the 340B Prime Vendor Program website for more information.

A hospital that is private, non-profit with a contract with a state or local government to provide health care services to low income individuals who are not entitled to benefits under Medicare or eligible for State Medicaid, is eligible for the 340B Program. A written contract must exist between the hospital and state or local government to demonstrate the hospital’s eligibility for the 340B Program. The written contract must be current, signed by authorized representatives of the hospital and the state or local government, and specify the hospital’s obligation to provide health care services to low income individuals. The written contract should be in effect prior to registering for the 340B Program and be current throughout the hospital’s participation in the 340B Program. HRSA expects that the written contract will be available upon request.

An entity receiving in-kind contributions through section 317 or 318 may qualify for the 340B Drug Pricing Program provided all the remaining 340B requirements are met.  Qualifying in-kind contributions must be paid for by section 317 or 318 grant funds to qualify a site as 340B eligible.  In-kind contributions may be in the form of real property, equipment, supplies and other expendable property, and goods and services directly benefiting and specifically identifiable to the project or program.

Yes, it is the covered entity’s responsibility to notify the HRSA Office of Pharmacy Affairs immediately if the entity learns it may no longer be 340B eligible.

The 11.75% requirement is waived for a few hospitals known as "Pickle" hospitals (named for a JJ Pickle, a former member of Congress). They are defined in the Section 1886(d)(5)(F)(i)(II) of the Social Security Act as "a hospital that serves a significantly disproportionate number of low income patients and is located in an urban area, has 100 or more beds, and can demonstrate that its net inpatient care revenues (excluding any of such revenues attributable to this title or State plans approved under title XIX) during the cost reporting period in which the discharges occur, for indigent care from state and local government sources exceed 30 percent of its total of such net inpatient care revenues during the period.”

HRSA emphasizes that offsite facilities containing multiple clinics or services must be registered as individual clinics or services, versus single registrations for entire locations.

Eligibility of offsite outpatient facilities is based on information in the hospital’s most recently filed Medicare cost report (59 Fed. Reg. 47884 (Sept. 19, 1994)), as received via a data feed from the Centers for Medicare & Medicaid Services (CMS).  The online 340B registration process requires hospitals to confirm the cost reporting period, disproportionate share adjustment percentage (if applicable), and ownership status received from CMS. Registrants must also identify the cost center line(s) containing expenses and outpatient charges for each of the clinics, services, or facilities being registered. Finally, registrants must provide the specific expenses and outpatient revenues for those clinics, services or facilities (from the working trial balance corresponding with the listed cost report).

Hospitals are encouraged to have their most recently filed Medicare cost report and trial balance available during the registration process.  If the information received from CMS is outdated or incorrect, registrants must submit Worksheet S, Worksheet S-2, Worksheet A, Worksheet C and the corresponding trial balance per the instructions provided at the end of the registration process.  Children’s hospitals must additionally submit Worksheet S-3; Disproportional Share, Freestanding Cancer, Rural Referral Center and Sole Community Hospitals must also submit Worksheet E, Part A.

No. Under the final guidelines a facility must be both reimbursable and included in the hospital’s most recently filed Medicare cost report. The outpatient facility guidelines can be found at (59 Fed. Reg. 47884 (Sept. 19, 1994).

Off-site outpatient facilities are eligible child sites of a 340B covered entity in the following circumstances:

1. The outpatient facility is listed as a reimbursable facility on a 340B hospital covered entity’s most recently filed Medicare cost report. If the facility is a free-standing clinic of the hospital that submits its own cost reports using a different Medicare number (not under the covered entity’s Medicare provider number), then it would NOT be eligible. Specific guidance was released in the 1994 in the following link: http://www.hrsa.gov/opa/programrequirements/federalregisternotices/outpatienthospitalfacilities091994.pdf.
2. The outpatient facility is included in the grantee’s scope of grant and meets the statutory requirements for the entity type for which it is registering..

An off-site outpatient facility meeting one of these criteria must register and be listed on the 340B database before it can purchase or use 340B drugs for eligible patients. For hospitals, all clinics located off-site of the parent hospital, regardless of whether those clinics are in the same building, must register as child sites of the parent 340B-eligible hospital if the covered entity purchases and/or provides 340B drugs to patients of those facilities. For example, if the off-site outpatient facility is a hospital, all clinics/departments within that off-site location that plan to purchase and-or provide 340B drugs to its patient must register as a child site.

Outpatient clinics/departments within the four walls (i.e., same physical address) of the registered parent 340B hospital do not need to also register/enroll into the 340B Program. However, the covered entity remains responsible for demonstrating that those outpatient clinics/departments are listed as reimbursable on the hospital’s most recently filed Medicare cost report, are only using 340B drugs for eligible outpatients, meet all 340B Program requirements, and maintain auditable records. Clinics at an offsite location from the registered parent must separately register on the 340B database, even if they are located within the four walls of that child site. This applies to all registered areas of offsite (from the parent) clinics/hospitals. Every eligible clinic which will purchase or use 340B drugs within such a hospital must register separately as a child site.

HRSA does not require a child site hospital location to register inpatient locations with observation beds. However, if a child site hospital voluntarily submits a registration for an inpatient location with observation beds, OPA will review the registration and the hospital must provide Worksheets A and C and the associated trial balance to support the registration. HRSA reserves the right to ask for additional supporting documentation if necessary.

The 340B Program is an outpatient drug program. Enrolled covered entities have the responsibility to ensure that drugs purchased under the 340B Program be limited to outpatient use and provided to individuals who meet the requirements of the current patient definition. HRSA acknowledges that 340B eligible patients may receive healthcare services in observation beds located in inpatient sections of the hospital. If a hospital uses 340B drugs for patients receiving healthcare in observations beds, the hospital must be able to explain how the covered entity is responsible for the use of the drugs on an outpatient basis and have auditable records and policies and procedures that demonstrate compliance with 340B Program requirements. Policies and procedures should specifically address how the hospital defines inpatient and outpatient for purposes of the 340B Program, and how that relates to observation beds. HRSA’s audits will ensure the hospital is following those policies and procedures.

Only hospital outpatient facilities that appear as reimbursable outpatient cost centers on the hospital’s most recently filed Medicare cost report are eligible to be listed and participate in the 340B Program. HRSA requires each hospital to register all of its off-site outpatient facilities where 340B drugs are purchased and/or provided to patients of that facility. This will ensure that each facility has been reviewed and verified by HRSA as eligible to participate in the program, therefore strengthening the hospital’s compliance efforts.

Pharmacies are not eligible 340B covered entities and therefore, should not be listed as a child site with a 340B ID in the database. It should then be determined whether it is appropriate for the pharmacy to be added as a “ship to” address for the actual covered entity in the database. If the pharmacy is located within an offsite outpatient facility that also provides healthcare services and provides 340B drugs to its patients, the outpatient facility must be registered as a child site with the pharmacy listed as a “ship to” of that outpatient facility. When a pharmacy is supporting multiple child sites of a parent entity, the pharmacy should be listed as a “ship to” address under the parent’s 340B ID.

All sites that purchase and use 340B drugs for their eligible patients must be listed on the 340B OPAIS. In order for non-hospital health care delivery sites to purchase 340B drugs or provide 340B drugs to their patients, they must first be eligible through the (non-hospital) covered entity’s grant and listed on the 340B database. Clinics located off-site of the parent covered entity, regardless of whether those clinics are in the same building, must register with OPA as outpatient facilities of the parent 340B covered entity if the covered entity purchases or provides 340B drugs to patients of those facilities.

Hospitals become ineligible for the 340B Program on the day a Medicare Cost Report (MCR) is filed with Centers for Medicare & Medicaid Services (CMS) with a DSH percentage below the applicable eligibility threshold. Hospital offsite outpatient facilities failing to the meet the registration eligibility requirements (listed as reimbursable on the MCR with associated outpatient costs and charges) become ineligible on the day the hospital files the MCR. If either occurs, the hospital should stop purchasing 340B drugs immediately and terminate their record in 340B OPAIS. If the hospital purchased while they were ineligible, the hospital should send the Office of Pharmacy Affairs (OPA) a self-disclosure to 340bselfdisclosure@hrsa.gov. HRSA may accept an amended MCR as long as it is considered the latest filed MCR by CMS. The hospital must submit a signed, dated, and electronically-stamped Worksheet S, along with other requested worksheets, as evidence the MCR was amended and filed with CMS. If the hospital chooses to file an amended MCR, the hospital may resume purchasing 340B covered outpatient drugs after the amended MCR is filed with CMS, sent to HRSA, and subsequently accepted by HRSA. The amended MCR may not be applied retroactively for 340B purposes and HRSA reserves the right to request additional documentation if necessary. The hospital may be liable for any 340B purchases made during the period of ineligibility between when the original MCR was filed to when the amended MCR was filed, depending on the specific circumstances of the case.

HRSA does not authorize covered entities to reclassify a purchase as 340B eligible after the fact. Covered entities participating in the 340B Program are responsible for requesting 340B pricing at the time of the original purchase. If a covered entity wishes to reclassify a previous purchase as 340B, the covered entity should first notify manufacturers and ensure all processes are fully transparent with a clear audit trail that reflects the actual timing and facts underlying a transaction. Drug transactions may be credited and rebilled within the wholesaler’s contracted and allowed timeframe according to standard business practices, however the covered entity retains responsibility for ensuring full compliance, transparency, and integrity of its use of the 340B Program.

The 340B Program is an outpatient drug program. Enrolled covered entities have the responsibility to ensure that drugs purchased under the 340B Program be limited to outpatient use and provided to individuals who meet the requirements of the current patient definition. 340B drugs can be used for discharge prescriptions to the extent that the drugs are for outpatient use. Whether a drug qualifies as outpatient and the individual meets the definition of patient depends upon the factual circumstances surrounding the care of that particular individual. If a covered entity uses 340B drugs, it should be able to explain why the covered entity is responsible for the use of the drugs on an outpatient basis and have auditable records that demonstrate compliance with 340B Program requirements.

A hospital may use 340B drugs for patients treated in mixed-use settings that appear as reimbursable cost centers on the hospital’s most recently filed Medicare cost report and meet patient definition guidelines. The hospital must develop appropriate tracking systems to ensure that covered outpatient drugs purchased through the 340B Program are not used for hospital inpatients. It is the responsibility of the hospital to ensure appropriate safeguards are in place to protect against diversion. If a hospital is unable to implement an effective tracking system, it should not use the 340B Program in that setting.

The new 340B Office of Pharmacy Affairs Information System (340B OPAIS) replaced the legacy 340B Database in its entirety and includes security updates and enhancements for covered entity/manufacturer registrations, change requests, recertification, and other updates. Some of the key features of 340B OPAIS are:

1. Manufacturers’ and covered entities’ ability to manage their own 340B record.
2. Improved efficiency through a task-oriented landing page for the covered entities’ and manufacturers’ Authorizing Officials and Primary Contacts. Additionally, covered entities and manufacturers receive e-mail notifications of pending tasks.
3. Enhanced security features such as two-part authentication for covered entities and manufacturers.

Individuals from manufacturer or covered entity organizations listed as an Authorizing Official (AO) or Primary Contact (PC) of a manufacturer or covered entity record are required to create a secure user account. The AO or PC then has access to the 340B records the AO or PC are associated. There is only one AO and PC per 340B record. A 340B record is defined as an individual manufacturer labeler code or covered entity 340B ID.

All AOs and PCs for a manufacturer or covered entity are required to log into 340B OPAIS and create a user account before any access is granted to the 340B record. Steps for creating a user account are determined by whether the user is currently listed with a 340B OPAIS record or are a first time user requesting to be associated with a manufacturer or covered entity record.

The login credentials required for 340B OPAIS include a username, which is the email address used to register for 340B OPAIS, and a self-created password. The user will also receive a 6-digit authentication code via email, each time you attempt to login.

To create an account in 340B OPAIS, please use the following steps:

1. From the 340B OPAIS home page, click the “I am a Participant” icon or click the “Login” icon in the top menu.
2. Click the “Create new account” link.
3. Type your email address in the space provided and click “Search.”
4. The “Create a New User” registration page will be displayed:
   1. If your email address is currently associated with an active or approved covered entity or manufacturer record as an AO or PC, your email address, name, title, organization (if available), phone number and extension will be populated automatically.
   2. If your email address has not been previously associated with a covered entity or manufacturer, enter your name, title, organization name (employer), phone number, and extension in the spaces provided before proceeding. All fields are required except phone extension.
   3. For “Parent Entity Type,” select either covered entity or manufacturer.
5. Type your password and then type it again to confirm.
6. Type the CAPTCHA code displayed in the image in the text box.
7. Click “Register.”

The 340B OPAIS will check for an existing account with your email address and validate the account. OPA Staff will review new user account requests and confirm or deny access to the 340B record.

These steps along with your account validation activity are found in the 340B OPAIS Public User Guide (PDF - 5.8 MB) on the 340B website, specifically the section on creating an account.

For authorized users with an existing account in 340B OPAIS, you can use the following steps to log into 340B OPAIS:

1. Click “Login” in the top menu of the 340B OPAIS homepage or click the “I Am a Participant” icon.
2. Type your email address and password in the spaces provided.
3. Click “Sign In.”
   1. If your login credentials are correct and you have an active account, the system will display the “Two-Step Authentication” page and send you an email containing a 6-digit authorization code.
4. Copy the authentication code from that email, paste it in the “Code” text box
5. Click “Submit Code.”
6. The system will prompt you to agree to the “340B OPAIS Rules of Behavior.”
7. Click on the checkbox next to the acknowledgement of responsibilities statement.
8. Click “Agree” or “Cancel” button.

These steps can be found in the 340B OPAIS Public User Guide (PDF - 5.8 MB) on the 340B website.

Please use the following steps to reset your password in 340B OPAIS:

1. From the login page, click “Recover Your Account” link.
2. Type your email address.
3. Click “Reset Password.”
4. An email will be sent to you containing a password reset URL.
5. Click the URL in the email message.
6. Enter and confirm your new password.
7. When reset is complete, you may proceed to log in as usual.

These steps can be found in the 340B OPAIS Public User Guide (PDF - 5.8 MB) on the 340B website.

If the user is already registered in 340B OPAIS and the user no longer has access to the registered email address, the user will need to create a new account via the online change request process. HRSA’s Office of Pharmacy Affairs (OPA) will review and determine whether to approve the submitted change request.

If you are using your current email address to access 340B OPAIS, but would like to change that email address, you will need to submit a change request via the online change request process.

The step-by-step instructions for submitting a change request can be found in the 340B OPAIS Public User Guide (PDF - 5.8 MB) on the 340B website .

Except for new account creation, only a covered entity or a manufacturer AO or PC can submit an online change request. Only an AO has the ability to approve on behalf of the covered entity or manufacturer and submit a change request. Manufacturers will no longer have a paper change request process and will follow the same online change request process as covered entities.

For help on how to submit a change request please refer to the 340B OPAIS Public User Guide (PDF - 5.8 MB) on the 340B website .

340B OPAIS has public search and reports functionalities, with limited public viewing privileges, that will still be available. Covered entity, manufacturer, and contract pharmacy profiles are still accessible for public viewing. All registration, recertification, change and termination requests for covered entities and manufacturers can perform these actions in 340B OPAIS and are only accessible by their respective AO and PC.

In 340B OPAIS, contract pharmacy registrations can be submitted concurrently with the associated Covered Entity registration. The Authorizing Official must approve and submit the contract pharmacy registration.

Covered entities and manufacturers have one AO and one PC per 340B record (i.e., individual manufacturer labeler code or covered entity 340B record). Covered entity AOs and PCs are subject to the following restrictions:

• The AO and the PC must be different people
• Hospital covered entity types are required to have the same AO across all records with the same Medicare Provider Number, but the PC can be a different person for each record

An associated site is terminology used by HRSA’s OPAIS to indicate sites that share grant numbers (CHCs) or a designation number (Federally Qualified Health Center Look-alikes). Prior to September 2017, these covered entity types had a parent-child relationship. The 340B ID numbers of these entity types will not changing only the terminology: from parent-child to “associated sites.” No other type of covered entity will have the associated site terminology.

The AO will no longer be sent a user name and password to login. The AO is notified of dates, times, and requirements of recertification via their listed email in 340B OPAIS. The AO has access via their 340B OPAIS user account-landing page where the AO has access to all 340B records their linked to and those that require annual recertification. At the start of covered entity recertification, a task is created in the PC’s task list for each 340B record that must be recertified. The same task is created in the AO’s task list. Either the PC or the AO can complete recertification for a covered entity record, but only the AO can attest and submit it to OPA. If the PC completes recertification for a covered entity record, that creates a task in the AO’s task list. The AO can make changes if necessary before attesting and submitting to OPA.

Manufacturers must submit 340B pricing information to HRSA, which will begin within a two week period starting on or about day 45 of the quarter. The pricing component of the 340B OPAIS will send an email alert to the registered authorizing official and primary contact of the manufacturer when the two-week window for reporting is open, as well as daily reminders that tasks are pending within the pricing component of the 340B OPAIS.

Manufacturers may log into the 340B OPAIS Pricing application and upload a formatted text/instrument file or manually enter the required data points containing their quarterly data. Specifics on the text/instrument file upload format can be found in the manufacturer user guide.

No, the 340B OPAIS pricing system is only available to actively participating covered entities. Once terminated, covered entities will no longer have the ability to log into the pricing system.

The hospital’s authorizing official upon enrollment, attests that the hospital “...will not participate in a group purchasing organization or group purchasing arrangement for covered outpatient drugs as of the date of this listing on the OPA website.”

The GPO prohibition applies to all disproportionate share hospitals, children’s hospitals, and freestanding cancer hospitals enrolled in the 340B Program. The GPO Policy Release does not apply to entities registered as any other type of covered entity.

The answer depends on how the HTC is registered with respect to the hospital. If the HTC is within the four walls of a parent hospital subject to the GPO prohibition and not separately registered for the 340B Program with a 340B ID beginning with “HM”, the HTC may not use an outpatient GPO. If the HTC is registered as an off-site outpatient clinic of a hospital subject to the GPO prohibition, the HTC may not use an outpatient GPO. If the HTC is an off-site outpatient facility of a hospital subject to the GPO prohibition, but is not registered for the 340B Program (as a child site of the hospital) and meets all of the following, if may use a GPO for covered outpatient drugs: 1. Is located at a different physical address than the parent; 2. Is not registered on the OPA 340B database as participating in the 340B Program; 3. Purchases drugs through a separate pharmacy wholesaler account than the 340B participating parent; and 4. The hospital maintains records demonstrating that any covered outpatient drugs purchased through the GPO at the HTC are not utilized or otherwise transferred to the parent hospital or any outpatient facilities registered on the OPA 340B database. If the HTC is otherwise an eligible entity and registered as such (340B identification number beginning with “HM”), then it is not subject to the GPO prohibition with respect to its own patients. In no circumstances may the HTC’s permitted use of a GPO be used to circumvent the GPO prohibition for a hospital and its outpatient clinics subject to the GPO prohibition.

A covered entity that is subject to the GPO prohibition may not use a GPO for covered outpatient drugs at any point in time. However, if a covered entity is unable to purchase a covered outpatient drug at the 340B price, they should first try and work with the manufacturer to obtain the product at the 340B price. If they are still unable to obtain the product at the 340B price, they should then try to obtain the product at WAC. If they are also unable to purchase the product at WAC, entities may use a GPO only if they then immediately notify OPA detailing the covered outpatient drug(s) involved, the manufacturer, and the communication between the parties as to why the product was not available at 340B or WAC. Forward a cover letter describing the situation and the collected explanations to: Health Resources and Services Administration, Office of Pharmacy Affairs, 5600 Fishers Lane, 08W05A, Rockville, MD 20857or by submitting the HRSA Template Notification Tool: Unavailable 340B Price . In situations where a product is unavailable at 340B or WAC, and the covered entity can document that all other options have been exhausted, the covered entity should maintain auditable records demonstrating the circumstance, which can also be reported using the tool cited above. In addition, the covered entity must show they attempted to purchase the product at 340B every time an order was made. Covered entities may not use the fact that they were unable to obtain a product on one day, to then use a GPO for an extended period of time. They must check availability each time a purchase is made.

The definition of covered outpatient drug is found in section 1927 (k) of the Social Security Act. The availability of a 340B price is not dispositive in determining whether that drug meets this definition of a covered outpatient drug.

No.

Yes. Covered entities should maintain auditable records and policies and procedures related to the definition of covered outpatient drug and the use of a GPO that is consistent with the 340B statute.

No. Under section 340B(a)(4)(N) of the Public Health Service Act, as amended by the Affordable Care Act, the prohibition against participation in GPO arrangements does not apply to critical access hospitals, rural referral centers, or sole community hospitals. The GPO prohibition only applies to 340B-enrolled disproportionate share hospitals, children's hospitals, and free-standing cancer hospitals.

The hospital must keep auditable records demonstrating that accumulation occurs for inpatient GPO or outpatient 340B for eligible patients (as defined by current patient definition guidelines (61Fed. Reg. 55156 (Oct. 24.1996)). A non-GPO outpatient account should be available for replenishment for covered outpatient drugs in the event a 340B product is not available.

No.

The 340B participating hospitals within the hospital system in this scenario have separate 340B registrations. For the hospitals registered for the 340B Program as a DSH, children’s hospital or freestanding cancer hospital, conducting price negotiations for covered outpatient drugs with any other hospital would create a prohibited group purchasing arrangement. The hospital system may negotiate prices for inpatient drugs only.

HRSA published Policy Release 2013-1 (PDF - 227 KB) on February 7, 2013 to clarify its policy regarding this 340B Program statutory prohibition. If a covered entity is not in compliance with the GPO prohibition, the covered entity must immediately notify HRSA, and will be terminated from the program. The covered entity may reapply during the next quarterly registration period once it determines that it is in compliance with all 340B Program requirements and can attest to such during the enrollment process. If HRSA determines that a covered entity participating in the program is not in compliance with the GPO prohibition, HRSA will terminate such entity from the 340B Program. In addition, all participating 340B hospitals must attest that they are in compliance with all 340B program requirements, including compliance with the GPO prohibition as detailed in Policy Release 2013-1 (PDF - 227 KB).

Yes. All covered entities may participate in the PVP, although disproportionate share hospitals, children's hospitals, and freestanding cancer centers that participate in the 340B Program are prohibited from purchasing covered outpatient drugs through a GPO. 340B Prime Vendor participation is voluntary, and there are no restrictions placed on covered entities electing to participate. Most alternative purchasing groups serving 330 grantees and other entities encourage participation in the 340B PVP to ensure members have access to best pricing on pharmaceuticals while offering members their own contract portfolios of medical/surgical, dental, office, and other non-pharmacy supplies, which tend to be complementary to the 340B PVP pharmacy portfolio. On occasion, there may be an alternative purchasing group that does not permit a member to simultaneously access their own contracts and 340B PVP contracts due to existing business relationships with a supply partner. In this situation, the covered entity may be required to notify the alternative purchasing group to cancel its membership before the selected pharmacy wholesaler will load the 340B PVP pricing available to the entity's pharmacy account.

The purpose of the PVP sub-WAC pricing in the non-GPO/WAC account is to support compliance for hospitals subject to the GPO Prohibition. Hospitals subject to the GPO Prohibition (DSH, PED, CAN) access the sub-WAC contracts in the non-GPO/WAC account as part of the Prime Vendor Program. This account was not intended for covered entities such as federally qualified health centers that are not subject to the GPO Prohibition.

The 340B Program does not prohibit covered entities from providing 340B drugs to individuals with private insurance as long as the individual is a qualifying patient of the covered entity and the drug is not subject to a duplicate discount under Medicaid.

Covered entities may only distribute 340B drugs to their employees that meet the patient definition guidelines set forth under the 340B Program. For current patient definition guidelines, see 61 Fed. Reg. 55156 (Oct. 24, 1996). The 340B Program is limited to patients of the covered entity and has never been a general employee pharmacy benefit or self-insured organization pharmacy benefit. Evidence of an employer relationship or insurer relationship alone is insufficient to determine 340B patient eligibility.

Yes, as long as they are patients of the covered entity.

STD (318A grantee) clinics that participate in the 340B Program may purchase 340B drugs (including prescribed contraceptives), for grantee patients that meet the patient definition criteria (61 Fed. Reg. 55156 (Oct. 24, 1996)). If an individual meets all of the requirements of the definition of patient, including the third requirement that the individual receives a healthcare service or range of services sufficient to establish a provider-to-patient relationship under the 340B Program from the 318A grantee that are consistent with screening, preventing, or treating sexually transmitted diseases, then the covered entity may purchase and dispense any 340B drugs for which the covered entity is responsible, including contraceptives, to that patient.

No. Covered entities are free to choose how they will provide 340B pharmacy services to their patients, subject to federal and state laws. Options include contracting with a retail pharmacy, providing in-house pharmacy services, administering drugs to patients, etc. For more information, including tools and technical assistance in providing 340B pharmacy services, contact Apexus Answers at 888-340-2787, or ApexusAnswers@340bpvp.com.

The “ship to bill to” procedure refers to an arrangement set up by the covered entity who is responsible for purchasing 340B drugs from wholesalers and/or manufacturers and directs those 340B drugs to be shipped to the contract pharmacy. In other words, the covered entity maintains title of the 340B drugs as required, but the contract pharmacy(ies) houses the drugs and provides dispensing services to patients of the covered entity.

The covered entity must have sufficient information to ensure ongoing compliance and the timely recognition of any 340B Program compliance problem at all contract pharmacy locations. The covered entity remains responsible for the 340B drugs it purchases and dispenses through a contract pharmacy. All covered entities are required to maintain auditable records and provide oversight of their contract pharmacy arrangements. HRSA expects that covered entities will utilize independent audits as part of fulfilling their ongoing obligation of ensuring 340B Program compliance. 340B Program violations found during internal or independent audits must be disclosed to HRSA along with the covered entity’s plan to address the violation. This information should be mailed to: Health Resources and Services Administration, Office of Pharmacy Affairs, 5600 Fishers Lane, Mail Stop 08W05A, Rockville, MD 20857. Additionally, HRSA audits of covered entities include a covered entity’s contract pharmacies. A contract pharmacy will be removed from the 340B Program if the covered entity is not providing oversight of its contract pharmacy arrangement.

The covered entity must have fully auditable records that demonstrate compliance with all 340B Program requirements, including drugs dispensed through a contract pharmacy arrangement. The contract pharmacy will provide the covered entity with reports consistent with customary business practices (e.g., quarterly billing statements, status reports of collections and receiving, and dispensing records). The contract pharmacy, with the assistance of the covered entity, will establish and maintain a tracking system suitable to prevent diversion of 340B drugs and duplicate discounts on the drugs. Customary business records, which must be readily retrievable, may be used for this purpose. The covered entity will establish a process for a periodic comparison of its prescribing records with the contract pharmacy's dispensing records to detect potential irregularities. Such records can include: prescription files, velocity reports, and records of ordering and receipt of drugs. These records will be maintained for a period of time required by State law and regulations (75 Fed. Reg. 10272 (Mar. 5, 2010)).

The Authorizing Official (AO) and Primary Contact (PC) should review the covered entity’s 340B OPAIS record to ensure the record is accurate and correct. Any inaccurate information should be corrected in advance of recertification by submitting an on-line change request.

Yes. Covered entities should not confuse change requests and recertification. Covered entity’s required to notify the 340B Program as soon as possible after the entity’s information changes to keep the record up to date. Recertification is required annually to meet the statutory requirement of keeping the entity’s record up to date and certifying compliance with the 340B Program requirements.

HRSA strongly recommends that the covered entity review and update its 340B database entry using the change request process prior to recertification. Once recertification starts, the listed Authorizing Official will receive a user name, password, and recertification user guide to perform annual recertification and attest to the covered entity’s 340B Program compliance.

The Authorizing Official is responsible for ensuring 340B Program compliance for the covered entity. Recertification covers the parent-covered entity and all registered child sites in the 340B Program database.

The date in the “start date” column is the first date that the entity began participating in the 340B Program. The date in the “term date” column is the effective date the entity is no longer participating in the 340B Program. These dates DO NOT relate to the covered entity’s MEF determination as carve in or carve out. To download the MEF for a specific quarter, on the MEF homepage in the 340B Database, a quarterly date range must be selected and those dates reflect the effective dates of the selected MEF download. As a reminder, the quarterly MEF reflects the decisions of covered entities that have chosen to “carve-in” Medicaid effective for a given calendar quarter and captures a snapshot of carve-in decisions at 12:01am ET on the 16th day of the month prior to the start of each quarter, irrespective of weekends or holidays.

The quarterly MEF reflects the decisions of covered entities that have chosen to “carve-in” Medicaid effective for a given calendar quarter and captures a snapshot of “carve-in” decisions at 12:01am ET on the 16th day of the month prior to the start of each quarter, irrespective of weekends or holidays. The quarterly MEF includes for each covered entity listed at least one Medicaid provider number (MPN) or one National Provider Identifier (NPI) registered with OPA as of the snapshot for that quarter. Covered entities may request changes to their “carve-in” decision and/or the specific identifiers listed at any time; however, these changes only take effect the following quarter, when published on the MEF, and only if the change request is received, approved and processed by OPA before the time of the snapshot. HRSA generally does not make retroactive changes to the quarterly MEF once published. If retroactive changes are necessary, HRSA will communicate this to the 340B Program stakeholders.

HRSA generally does not make retroactive changes to the quarterly MEF once it is published. On rare occasion, a technical system issue may warrant an immediate modification. If retroactive changes are necessary, HRSA will communicate this to the 340B Program stakeholders.

Covered entities must choose whether they will use 340B drugs for their Medicaid patients. If they choose to use 340B drugs for Medicaid patients (carve-in), they must provide the HRSA Office of Pharmacy Affairs (OPA) with the Medicaid provider number and/or NPI used to bill Medicaid to be listed on the 340B Medicaid Exclusion File. The 340B Medicaid Exclusion File is available to state Medicaid agencies and manufacturers to prevent duplicate discounts, as prohibited by statute. If an outpatient facility or sub-grantee/sub-contractor bills under a different Medicaid provider number or NPI than the parent site, that information must be appropriately listed for each outpatient facility.

To carve out Medicaid, a covered entity chooses to forego the 340B discount drugs for Medicaid patients. In this arrangement, 340B drug inventory is dispensed only to non-Medicaid patients. The covered entity would not be included on HRSA’s 340B Medicaid Exclusion File.

The covered entity should submit Medicaid provider numbers/NPIs that are used to bill 340B drugs to Medicaid patients in any state. This is most often the pharmacy’s Medicaid provider number/NPI, but could also be the clinic Medicaid provider number/NPI or a combination of both, depending on the services at the clinic. For more information, contact the 340B Prime Vendor at 1-888-340-2787 or via email at ApexusAnswers@340BPVP.com.

340B drugs may not be used for Medicaid patients at a contract pharmacy, absent an arrangement between the contract pharmacy, covered entity, and state Medicaid agency to prevent duplicate discounts. Any such arrangement shall be reported to the HRSA Office of Pharmacy Affairs by the covered entity. For additional information, see the Federal Register notice.

The effective date for the 340B Ceiling Price/CMP regulation (82 FR 1210, January 5, 2017) is January 1, 2019. The rule will be applied prospectively. Manufacturers that offer 340B ceiling prices as of the quarter beginning January 1, 2019 must comply with the requirements of the final regulation.

The 340B Ceiling Price and CMP Regulation replaces former "Clarification of Penny Pricing" policy release (2011-2 (November 21, 2011)) and the final guidelines in 1995 describing ceiling price calculations for new drugs (60 FR, 51488 (October 2, 1995)).

When the 340B ceiling price calculation results in an amount less than $0.01, the 340B ceiling price will be $0.01. For more information, please visit the 340B Ceiling Price and Civil Monetary Penalties final rule (82 FR 1210, January 5, 2017) (PDF - 306 KB).

Manufacturers who participate in Medicaid are required to participate in the 340B Program and provide a 340B ceiling price for all covered outpatients drugs. To view which manufacturers participate in the 340B Program, please visit the 340B OPAIS Search page. A 340B participating manufacturer must provide a 340B price on all the covered outpatient drugs that meet the definition in section 1927(k) of the Social Security Act.

Pursuant to section 340B(a)(1) of the Public Health Service Act and the 340B Ceiling Price and Civil Monetary Penalty final rule (82 FR 1210, January 5, 2017), the 340B ceiling price for a covered outpatient drug is equal to the Average Manufacturer Price (AMP) from the preceding calendar quarter for the smallest unit of measure minus the Unit Rebate Amount (URA). The 340B ceiling price is calculated using six decimal places and HRSA publishes the price rounded to two decimal places.

Pursuant to a delegation of authority, the HHS Office of the Inspector General (OIG) has the authority to impose CMPs utilizing the definitions, standards, and procedures under 42 CFR Parts 1003 and 1005, as applicable. For additional information, see the delegation of authority Federal Register Notice (82 FR 1356, January 5, 2017) (PDF - 185 KB).

HRSA requires manufacturers to refund covered entities on all drug overcharges and should work with the covered entities in good faith to make repayments. Specifically for new drugs and as outlined in the CMP final rule, manufacturers are required to calculate the actual 340B ceiling price and offer to refund or credit the covered entity the difference between the estimated 340B ceiling price and the actual 340B ceiling price within 120 days of the determination by the manufacturer that an overcharge occurred. For overcharges on other drugs, HRSA expects repayment procedures to follow similar processes that align with standard business practice and be documented in the manufacturer’s policies and procedures.

The 340B ceiling price is defined in statute (section 340B(a)(1) of the Public Health Service Act) and implementing regulations (42 CFR §10.3 and §10.10(a)). The 340B ceiling price is the maximum statutory price a manufacturer can charge a covered entity for the purchase of a covered outpatient drug and is equal to the average manufacturer price (AMP) from the preceding calendar quarter for the smallest unit of measure minus the unit rebate amount (URA). HRSA calculates the 340B ceiling price at six decimal places and then subsequently publishes the 340B ceiling price in the 340B OPAIS rounded to two decimal places.

HRSA also publishes a package adjusted price for each covered outpatient drug in the 340B OPAIS. HRSA publishes the package adjusted price as a courtesy to assist manufacturers and covered entities in evaluating the 340B ceiling price. The package adjusted price is calculated using the 340B ceiling price, the package size (PS), and the case pack size (CSP) for a covered outpatient drug, and represents the price that the covered entity actually pays for the drug.

 

Package Adjusted Price = (AMP – URA)* PS *CSP

The PS is the quantity of a unit of measure contained in one package sold by a manufacturer under a particular 11 digit NDC. The CSP is the number of salable units in the shipping container. HRSA publishes the package adjusted price in 340B OPAIS rounded to two decimal places.