Ensuring 340B compliance and maximizing program performance: Becker's Chief Pharmacy Officer Summit 2024

The 340B program allows healthcare providers that serve low-income and uninsured populations to purchase outpatient drugs at discounted rates. Drugmakers must participate in the program or risk losing access to Medicaid and Medicare Part B reimbursement. The program has been the object of controversy in recent years with critics arguing that 340B use has surpassed its original intent and that some hospitals aren't passing on the savings to patients. Drugmakers have specifically cited the issue of duplicate discounts as evidence of misuse. In November, Johnson & Johnson and Eli Lilly both sued the federal government over the future of their respective 340B drug rebate plans.

Hospitals and health systems contend that the 340B program provides critical financial support that helps them care for low-income populations and uninsured populations. However, these organizations face numerous challenges when working to achieve compliance and maximize the reach of the program to benefit patients. These challenges include inventory management, overseeing compliance among contact pharmacy partners and, perhaps most notably, navigating shifts in manufacturer restrictions.

Nicole Shoquist, PharmD, CPO with Fort Worth, Texas-based JPS Health Network, described how her organization navigated restrictions that reduced the reach of its 340B-covered clinics. In the 2010s, JPS Health Network — a tax-supported health system that serves a community of more than 2 million people throughout Tarrant County — launched 19 school-based clinics to serve children from low-income families. Drug manufacturer restrictions have pushed JPS to significantly reduce the reach of those clinics, according to Dr. Shoquist.

"Since the manufacturer restrictions, JPS has had to scale that program down to two schools," Dr. Shoquist said. "We've had to decide what are the two schools that are the most desperate for their students to have access to care. With these clinics, if there is a student with asthma and they're having an exacerbation, they can go across the parking lot to see the nurse practitioner get a breathing treatment and actually be back in the classroom rather than being sent home or going to the emergency room. If you look at the examples of what we can do for our communities with the financial support of 340B, I believe it is our obligation to optimize everything we can within the guardrails of the program."

"Engaging our marketing team to really help publicize and tell the good stories about how 340B has allowed us to subsidize services we otherwise wouldn't be able to do. We can't provide behavioral health services without some way to subsidize it. And primary care is another area that is not a moneymaker, but it's a desperate need in many communities, especially ones like mine where we have a lot of rural areas. Our 340B program makes it possible. It's what creates access for our patients."

Critical components of 340B optimization for providers include achieving internal C-suite buy-in and outside advocacy. Jessica Galens, PharmD, assistant chief pharmacy officer with UCSF Medical Center in San Francisco, emphasized the importance of advocacy at both the state and federal level amid uncertainty about the future of 340B.

"It's really important that all of us are engaged in advocacy because challenges [to 340B] are coming at us from all sides," Dr. Galens said. "We need to be ready to tell our story, remind folks what the original intent of the program is and how our covered entities are working really hard to really optimize the program and serve that intent."