GAO Expresses Compliance Concerns in 340B Study - Hudson Headwaters 340B

The U.S. Government Accountability Office (GAO) has published its much anticipated study on the 340B Drug Discount Program. The study was conducted based on concerns regarding the exponential growth the program through contract pharmacy arrangements. The intent of the GAO study was to make recommendations as to how the Health Resources and Services Administration (HRSA) could improve program compliance and oversight.

The GAO reviewed over 50 covered entities and 30 contracts to complete its analysis for the drug pricing program. In general, the GAO concluded that the program, as it relates to contract pharmacy, “needs improvement”. Overall the GAO recommends that HRSA increase its oversight of the program to ensure covered entities are maintaining program compliance when carrying out 340B contract pharmacy arrangements.

Concern over the treatment of Medicaid Managed Care claims was apparent throughout the report, as currently there is little guidance or review provided by HRSA. Entities that currently carve in Medicaid Managed Care could be at risk and should consider an external 340B audit to ensure compliance.

The GAO made seven recommendations, stating that HRSA should:

1. Require that contract pharmacies are registered under each eligible entity site on the OPA database.
2. Work with the States to provide guidance on how to prevent duplicate discounts to drug manufacturers for claims covered by a Managed Care Organization
3. Create a framework to audit compliance with the prevention of duplicate discounts to drug manufacturers for claims covered by a Managed Care Organization
4. Provide clarification on the look-back timeframe required when a breach in compliance is identified
5. Require an outline of the methodology an entity will use to assess noncompliance identified during a HRSA audit
6. Only close a covered entity audit when evidence of the completion and implementation of a corrective action plan has been provided by the entity
7. Share additional guidance on the expected oversight of contract pharmacy arrangements

Click here to read the full GAO report on the 340B Drug Discount Program.

For guidance through uncharted territory, let our team be your resource and your partner. Reach out to learn more about how ATRIA 340B can help you maximize your compliant 340B program. We’re in this together, so let’s do it right.