Hospital Leadership Support Critical for 340B Compliance

Today’s blog comes to us from James Jorgenson, RPH, MS FASHP, Chief Executive Officer, Visante Inc. The focus is on what it takes to make the 340B drug pricing program successful. Once you’ve had a chance to look it over, we’d love to hear your thoughts. Generating meaningful conversations around the health issues affecting he people of our state is another way we are working toward our long-term goal of one day making Arizona the Healthiest State in the Nation

The 340B Program provides important financial support to extend care to the most vulnerable populations. However, a compliant 340B program must be an organizational effort that requires a strong collaboration between pharmacy, finance, government affairs and others, and must include a knowledgeable and engaged senior management group.

Heightened scrutiny of 340B means that it is more critical than ever for covered entities (CEs) to ensure they have a vigorous compliance program that clearly demonstrates all required program elements are being achieved and savings from the program are supporting the intended purpose.

Many 340B Programs struggle with compliance which puts their programs at risk. These questions taken from the US Justice Department for evaluating corporate compliance are helpful in evaluating 340B compliance management.

Are Senior Leaders engaged in understanding program requirements and ensuring compliance? We believe that a summary report of compliance and risk should be at least a quarterly element of senior leadership program oversight.

How is information provided and used, and who is involved in analysis and review?
Data must be converted into actionable information that can be analyzed and used to support a CE-wide compliance effort. Reports should at a minimum reach the authorizing official (AO) and we recommend the CEO, COO and CFO (in addition to the AO) also be regularly apprised of compliance and risk status.

What is the organization’s record of non-compliance outcomes? Non-compliance should be documented and tracked longitudinally to ensure there isn’t a continued pattern of issues. In addition, it is critical to manage identified compliance gaps to the CE’s material breach policy, to verify if a breach needs to be self-disclosed.

Does the covered entity publish a compelling Community Benefit document? A key criticism of the program is that covered entities haven’t used savings to foster programs directly benefiting patients which the 340B program was intended to help. Careful accounting and documentation of services supported by 340B savings are critical and the stronger the correlation between the 340B savings and program funding, the better.

Does the organization conduct an annual external review and audit of its 340B compliance program? Numerous external audit resources are available; however, CEs should be careful to select audit support that is completely independent and agnostic of any conflicts of interest around the program. External audits should also produce statistically valid samples of all claims types and should not just be a minimal review of selected claims.

How is external audit support activity evaluated? Careful due diligence regarding external audit support should be completed, including program experience, client retention, individual consultant experience and credentials, pricing transparency and availability to be on-site to support a CE during a HRSA audit.

The 340B program provides valuable financial means to help stretch scarce resources and extend care to vulnerable patients. Protecting the program requires senior leadership engagement to optimize and support compliance efforts and validate that the program is performing as expected and delivering the desired results.

For more detailed suggestions on program compliance see our full article in Becker’s Hospital Review.

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