For Lisa Scholz, Chief Customer Engagement Officer and SVP at Sentry Data Systems, the 340B Coalition Winter Conference held in San Francisco on Feb. 1-3 provided a view of the current state of the 340B program and a glimpse of future changes to come. Said Scholz, “Several key themes emerged regarding the current program — changes in HRSA’s compliance management, Medicaid Managed Care and payer reimbursements, and inventory management, to name a few. I also believe we’re at the beginning of an awakening within the industry that analytics derived from 340B data could not only help identify cost savings opportunities, but also help improve the quality of patient care.”
Following are a few updates based on a recent interview with Dr. Scholz:
- Compliance and auditing – Last October, HRSA’s government contractor, The Bizzell Group, began performing all 340B audits. Said Scholz, “Based on Sentry’s direct experience and feedback at this conference, it appears the actual audit data requests and procedures will be very similar, however, certain 340B areas such as patient eligibility, Medicaid, and treatment of Managed Medicaid will receive added focus this year, and, over time, they’ll become more sophisticated in their requests for analytics and summary-level data. The Bizzell Group partnered with the American Pharmacists Association (APhA) so now they have pharmacists and pharmacy technicians with hands-on 340B experience to support these audits. There have already been more than 15 audit requests so far this year, and we expect there to be 200 audits this fiscal year, roughly the same number as last year.”
- Medicaid Managed Care – In May of 2016, CMS published a final rule that requires all MCOs to identify and exclude 340B claims from utilization reports they provide to State Medicaid programs for purposes of requesting rebates. This rule goes into effect in April. According to Scholz, “At the conference, two Medicaid state programs spoke about 340B management processes. To no one’s surprise, the processes reported by these two states were inconsistent and would require additional work-arounds by covered entities that would need technology to enable reporting. Unfortunately, there is a lack of documented procedural policy, which creates uncertainty and inefficiencies.”
- Covered entities desire increased transparency and collaboration – Customers have common issues and increasingly want to collaborate with their peers to address challenges. Said Scholz, “This was a key reason why Sentry devotes resources to training and collaboration at conferences like this. Our customers crave the opportunity to connect with others who can relate to their unique 340B challenges and we want to facilitate that engagement.”
- The future of 340B involves greater insights – Covered entities are seeking a deeper understanding regarding how analytics can leverage their existing 340B data to help propel their organizations ahead. According to Scholz, “I believe this is the future. If you look back, the 340B program has gone through three distinct phases:
- PHASE 1 = In 1992, Congress created the 340B program, which provides certain hospitals and federally funded grantees access to discounted prices on pharmaceutical products so they could serve the indigent in ways not previously possible. In 2003, Sentry Data Systems was established to assist Covered Entities in managing the 340B program.
- PHASE 2 = 340B began audits through HRSA in 2012, which increased the complexity of managing this program, but also provided greater accountability and transparency for all the stakeholders. In late 2011, Sentry created a dedicated 340B Audit & Compliance team in preparation for HRSA audits.
- PHASE 3 = In 2016, Sentry Data Systems shared its long-term vision to support the industry transition to value-based care, and introduced the industry’s first Patient Data Intelligence Platform. With powerful analytics derived from 93MM+ patient records, including prescription, clinical and claims data, covered entities and others can now finally tell a holistic story about their patients at an individual as well as a population level…in real time. At the 340B Winter Conference, hospitals began to share use cases in which millions were saved by identifying appropriate revenue/charge data and cost accounting combined with outcomes management. As a result, patient care was improved by prescribing different medications based on previously unavailable analytic insights. Hospital administrators are looking to their pharmacy leadership as a strategic source of intelligence for the entire organization.”
In closing, Lisa commented, “I had a couple of conversations that summed up the conference nicely. One person who had recently joined a 340B hospital commented, ‘The complexity of 340B is enormous and continues to increase. On a positive note, however, I am beginning to see a future of 340B beyond just managing compliance – I believe the patient data we are collecting will provide insights to help improve the quality of care we deliver as well as help us achieve our strategic goals.’ Another colleague mentioned, ‘With the election of President Trump and the abolishment of the mega guidance rules, there is more uncertainty around the 340B program. It’s been helpful to gain perspective from fellow pharmacy leaders and all the experts at this conference.’ I sensed a tone of cautiousness but also hopeful optimism that we’re just beginning to uncover the powerful potential of 340B – not only to stretch their scarce federal resources, but also to help support covered entities grasp the evolution of healthcare to a value-based system.”