My project 1 1 - What to know about submitting contract pharmacy claims data to 340B ESP: Lessons learned

What to know about submitting contract pharmacy claims data to 340B ESP: Lessons learned

It’s hard to believe it’s been nearly three years since the first pharmaceutical manufacturer in July 2020 announced it would exclude 340B pricing from contract pharmacy covered entities, citing concern about Medicaid duplicate discounts. Despite several attempts by HRSA and through the judicial process to stop the policies, the number of manufacturers restricting 340B access to contract pharmacies (referred to as data, access or limited distribution models) continues to grow, and we anticipate additional manufacturers in 2023.

As we write this, there are 21 manufacturers with contract pharmacy exclusions. While there is some variation among their policies, most use the third-party platform 340B ESP for covered entities to submit data to regain 340B pricing, generally at a limited number of pharmacy sites. Several manufacturers have added 45-day look-back policies, new NDC restrictions, and adjustments to pharmacy designations, adding new challenges to running a 340B program.

And yet, more and more covered entities have decided they can no longer hold out and have begun or are ready to begin submitting data. Below are some observations about the new data submission model we have gained working with the wholesalers, Second Sight Solutions (340B ESP), customers, and other stakeholders.

Exemptions to data submission

Some manufacturers are allowing entities to designate one or two pharmacies in lieu of having to submit data. To do that, you’ll either have to designate your pharmacies — retail or wholly owned — via email with the manufacturer or through 340B ESP. In many cases, you’ll need your Health Industry Number, or HIN, which is a supply chain identifier available through the drugmaker or GPO distributor, sometimes via a fee.

Access to 340B ESP is generally limited to one contact per covered entity. If you’re an enterprise model — say a DSH hospital with three other DSH sites — you’ll have to also designate users at those sites to be granted access.

Initial data submission

If you’ve decided to start submitting data, your next step is to identify which manufacturers and contract pharmacy sites — what 340B ESP calls an “eligibility determination” — you want for pricing restoration.

Check to see whether you’ll need your HIN number; it may be an additional step for submitting claims data, and it could affect claims eligibility due to the 45-day lookback period some manufacturers are enforcing, since receiving your HIN number can sometimes take weeks.

Another challenge is getting historic 340B pricing back. You have to show proof that your previously eligible claims were marked as ineligible in one of three ways, depending on the manufacturer:

  • Through qualified claims (you can use the monthly manufacturer impact report we’ve been providing since the manufacturer mayhem began), which shows that claims were historically eligible but were not replenished when 340B pricing was cut off by the exclusions
  • By submitting a prior history of claims to demonstrate 340B purchasing, which will require going back more than a year for many manufacturers
  • By doing an attestation, if the manufacturer allows it, within a 45-day forward timeline

Keep in mind you may also need to obtain permission from your designated contract pharmacy, or send notification, to share their claims data with a third party.

Also, the timing of 340B pricing restoration may vary by pharmacy, since it can take weeks for a manufacturer to notify a wholesaler, and they tend to process the status of pharmacy locations individually, rather than in bulk. Then, there are processing lags in updating the wholesaler 832 price file between handoffs to manufacturer, to the wholesaler and the 340B software vendor (which happens daily, weekly, or monthly) to show 340B price. See how fun this process is?

Finally, review the NDC list on 340B ESP to compare claims report NDCs to make sure the platform isn’t excluding an NDC. At The Craneware Group, our technology automatically scans for this, since manufacturers add and remove NDCs all the time from the platform, with no notice. Talk about “transparency.”

Post data submission

You’ve submitted data and are waiting for 340B discounts to return. Some manufacturers will allow all pharmacies within a chain to be eligible, which is nice. The challenge is in sustaining your 340B price once restored. We’ve seen cases where entities that have gotten this far suddenly see 340B pricing removed again, often eight to 12 weeks into data submission, with a notice of “incomplete submissions.” This means your data didn’t “conform” (their word) with the manufacturer’s policy.

There are three different levels of visibility for claims processing within 340B ESP:

  • In progress, meaning the order is with the wholesaler and manufacturer and should process within 10 days
  • Ineligible, which may or may not need action and means either:
    • The contract pharmacy site will not receive 340B pricing
    • A contract pharmacy is not listed (most likely because you’ve designated it as an exemption or it’s a wholly owned pharmacy), so you should contact 340B ESP support
    • NDCs are missing
    • Other claims data is missing (i.e., rows missing, invalid data, pharmacy ID incorrect, outside of date of service)
  • At risk, which requires action and research:
    • Your cadence of purchases to dispensed accumulations do not match; these will often be labeled “non-conforming” when 340B ESP uploads the data if the claims are outside of the 45-day look back period, per manufacturer policy
    • Chain pharmacies are approved for all locations, but claims data is not submitted for all pharmacies registered to the covered entity
    • The covered entity will see a data extract that contains NDC numbers only with quantities

Bear in mind, claims data for certain manufacturers do not allow for central fill distribution for the big chain pharmacies, and unlike covered entities, not all manufacturers use 340B ESP to communicate. You may also get an email from 340B ESP saying that a pharmacy has been flagged as “at risk” for losing 340B pricing because you’re not following the manufacturer policy. Often, we find this is because they are failing to account for 45-day attestation or lookback periods.

Manufacturer policy impact

Here are some specifics we have noticed about manufacturers:

  • Many have 45-day time limits, either for attestations or lookback periods
  • Getting clarification from 340B ESP, manufacturers or wholesalers on pricing depends on each party’s ability to communicate and update files
  • It’s a challenge to understand the varying and often vague manufacturer policies, and interpretations will vary by consultants and other stakeholders
  • Once you submit data, historical pricing doesn’t return to pre-data-submission levels in all cases due to the 45-day policy limitations

Make sure your C-suite understands that just because you agree to start submitting data, things don’t simply revert to normal.

The lack of normal is the new normal.

Operational considerations

Finally, a few things entities should consider before agreeing to submit data:

  • Approval and review by key areas within the hospital leadership, including compliance, finance, and legal
  • The staffing resources needed to review and create data submission reports, new policy changes, reporting, and “at risk” or ineligible follow-up
  • The need to document standard operating procedures for submitting data to determine informed or consultative roles, plus who will have responsibility and accountability
  • Incorporating manufacturer impact reports with the 340B steering and Pharmacy & Therapeutics committees
  • Auditing the data submission process itself as part of monitoring for 340B manufacturer compliance

Data submission is a new part of the business of 340B, unfortunately. And as you can see, it brings a lot of new tasks to keep track of and perform.  Contact us to learn more on how we support covered entities that transition to submitting data, including the reporting provided and support from our experts.

Have courage, we are in this together.


If you’d like to continue the conversation with me, schedule a time that works for you and I’ll be in touch!

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