What Pharmacists Need to Know About the 340B Program
The 340B program doesn’t seem to be mentioned much in pharmacy schools, yet it is a great business opportunity for community pharmacies and also a nontraditional career path for many pharmacists and technicians. I hadn’t even heard of the program as a community pharmacist until I started working in an outpatient pharmacy.
Let’s talk about the 340B, how community pharmacies can benefit, and where to learn more and even get the skills needed to land a job with the program.
What is the 340B program?
The Health Resources and Services Administration, or HRSA, defines the 340B program as a federal program that “enables covered entities to stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.” It requires drug manufacturers participating in Medicaid to provide their medications to covered entities, or to organizations that are eligible, at a largely reduced cost.
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In one survey, covered entities reported that 340B program savings allowed them to expand services, make up for uncompensated care, offset low reimbursement, and even keep their facilities open. While the amount saved varied due to facility size, the average savings among hospitals surveyed was $11.8 million.
HRSA is responsible for administering 340B. Apexus is the prime vendor for the HRSA contract to support the program. In this role, Apexus contracts with manufacturers and distributors to ensure access to 340B medications, provides 340B education, and offers technical assistance. The 340B Office of Pharmacy Affairs Information System, or OPAIS, is the official database of all covered entities and 340B ceiling prices.
What are the requirements?
The 340B program is somewhat complicated, and so most covered entities hire full-time staff, often pharmacists and/or pharmacy technicians, to ensure they’re in compliance.
The overall requirements include the following:
Only eligible patients, receiving care from an eligible organization, may receive 340B drugs.
Medicaid rebates may not be requested on 340B drugs (termed a “duplicate discount”).
Auditable records must be maintained to demonstrate compliance.
Who is eligible?
Eligible organizations, also called covered entities, are defined by the Public Health Service Act, the legislation that created the 340B program, and may include, among others:
Federally Qualified Health Centers that provide care to underserved areas
Native Hawaiian and Tribal/Urban Indian Health Centers that provide care to those target populations
Ryan White HIV/Aids Program Grantees that provide HIV care to those who are uninsured or underinsured
Various types of hospitals, including Children’s Hospitals, Critical Access Hospitals, and Rural Referral Centers
Various types of specialty clinics, including Black Lung Clinics and Sexually Transmitted Disease Clinics
The full list of eligible organizations is available here.
It is important to note the 340B program applies to outpatient, not inpatient, medications. Eligible patients are outpatients who receive care from the covered entity and must meet certain requirements as well.
What role do community pharmacies play?
Covered entities may dispense 340B drugs through their own outpatient pharmacies, but are also allowed to dispense through contract pharmacies. These pharmacies dispense the covered entity’s medications, typically for a fee, and the covered entity keeps the remaining profit.
This type of arrangement can benefit both parties: The covered entity gets access to a pharmacy if they don’t have one, or gets access to a larger network of pharmacies, while the contract pharmacy gets a new source of revenue.
Because patients are still able to have their prescriptions filled at their selected pharmacy, many covered entities choose to have arrangements with multiple contract pharmacies to increase their 340B opportunity. For hospitals who are 340B covered entities and have an outpatient pharmacy, building a robust meds-to-beds program can also help them optimize their 340B returns. If they own the outpatient pharmacy, they capture the 340B savings and avoid dispensing fees; if they do not own the contract pharmacy, they pay a dispensing fee but still capture the 340B benefit.
While responsibility for program compliance ultimately falls to the covered entity, it is also critical for contract pharmacies to have staff that understand and stay in good standing with the 340B program. According to one recent analysis, there were over 28,000 contract pharmacies nationwide, so there is a good chance 340B knowledge and skills could help in a current or future community pharmacy role.
Where can I learn more?
Apexus is the approved vendor to administer the 340B program and provides the most recognized and in-depth training for it. If you’re interested in learning more about the 340B program, and especially if you are going to be working at a 340B contract pharmacy, it offers high-quality free training. I took the Apexus course myself once I learned our health system was becoming eligible for 340B, and it provided me with the basic vocabulary and tools necessary to help our team set up the pharmacy for dispensing 340B medications.
In addition, Apexus offers more advanced training for those interested in working as 340B program compliance experts. Program experts have numerous career opportunities, including at 340B consulting firms, covered entities, drug distributors, and other stakeholders, even at HRSA or Apexus.
The bottom line
The 340B program provides significant savings for covered entities, which can then apply those resources toward better care for those who are uninsured or underinsured. As a pharmacist or pharmacy technician, 340B can provide a nontraditional career path and give you the chance to use your knowledge to help those most in need.
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