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    The Winners and Losers of 340B Changes

    What CMS' big changes to the 340B Drug Discount Program will mean.

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    Hospitals should take a systematic approach to evaluating the costs and benefits of the program to determine whether it continues to be a viable option, he said. Pharmacy leaders can provide valuable feedback about the drugs that have been purchased and estimated drug savings in reviews of the program; however, hidden costs also need to be evaluated. These hidden costs can include the price of software programs or personnel costs for staff who may conduct internal audits, help monitor the program, or evaluate compliance, he said.

    “We need to compare what our utilization is for those medications and then look at what our current reimbursement is and what our new reimbursement will be under this program and then add the other costs from our previous calculations to see, ‘Does this still make sense for us to be in the program?’ Or have we lost our savings or a significant portion of the savings?” he said.

    Maxik quoteHospitals will not only lose reimbursement, but are now also faced with significant information technology implications. Under the new ruling, certain 340B covered entities will now have to add a modifier in their billing systems for drugs that fall under the program. According to Maxik, those hospitals that are subject to a reduced payment will have to add a JG and TB modifier, while those who are subjected to payment exemptions but are still a covered entity will have to add a TB modifier. 

    The covered entity may not be able to establish a global system to resolve the modifier requirements, which may require a manual system which could add significant manpower hours for hospital staff. 

    Determining which modifier to use, what class the drug is, and how it will be handled will likely add significant manpower hours for hospital staff.

    “This is really what the pharmacy directors can help with,” Maxik said. All the information system and finance staff must map out all of these different permutations, not just by drug but also by location type and whether the location is participating in the 340B program, whether it is administering a 340B drug, or whether it is classified as a client site. “Because all those iterations mean you have to do something different,” he said.

    Jill Sederstrom
    Jill Sederstrom is a Contributing Editor

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