POST OUTLINE
PHASE ONE: Organizing 340B data, coordinating teams
- Connecting and educating 340B system providers
- Requalifying all eligible, but unreimbursed, 340B scripts
- Retrieving 340B eligible-script data
- Establishing communication lines between internal and external 340B teams
Why specialized software is essential for successful 340B programs
- The central problem with most 340B programs’ data
Why 340B software alone is not enough
- The critical role humans play in the 340B software equation
PHASE TWO: Deepening 340B insights, then applying them
- Closing 340B program gaps
- Reporting 340B prescriptions by drug and provider
- Helping your providers & contract pharmacies better serve your 340B patients.
- Making better 340B program decisions faster.
PHASE THREE: Building-out 340B program “infrastructure”
- Optimizing the number and quality of 340B eligible contract pharmacies
- Capturing 340B savings with onsite pharmacies — retail and specialty
- Supporting patients and your 340B program with Meds To Beds
Eight tips for dealing with 340B ESP
ProxsysRx is here to help, if you have questions.
There are so many ways to optimize your 340B drug program savings and benefits. For more information on any aspect of developing and managing a successful 340B program, contact:
HOWARD HALL C: 214.808.2700 | howard.hall@proxsysrx.com
FULL POST
It’s no secret that drug manufacturer restrictions — which were first implemented with the June 2020 launch of the 340B ESP website — have devastated many eligible hospitals’ 340B programs. According to a report from the advocacy organization 340B Health, “Safety-net hospitals lost $1.1 billion in 340B savings from just five companies’ restrictive policies in 2021 alone.” As a result, “One in three critical access hospitals have been forced to cut services due to 340B pricing restrictions [and] two in three hospitals with impacted discounted drug assistance programs report patient harm, including delayed access to medications.”
Again, that’s more than a billion dollars safety net hospitals could have dedicated to serving patients who are often unable to afford healthcare; lost to the restrictions of just five drug companies. Five companies — Merck, Sanofi, Astra Zeneca, Novartis and Eli Lilly — whose average gross profit margin in 2021 was over 71%.
By contrast, you might wonder, how “devastating” the 340B program was to those five companies the year before — when they avoided their legal obligations to reimburse eligible prescriptions only half the year. Ironically, their average gross profit margin in 2020 was over 73%. One almost has to wonder if there was a higher force at work in 2021, balancing the scales of justice.
Consider the profound loss of healthcare access, not to mention the loss of life, among our nation’s most vulnerable patients and families, lost to drug companies — now numbering 34 — whose gross profit margins routinely exceed the S&P 500 average not in terms of percentages, but multiples. Is it any wonder that those of us serving the hospitals who serve those patients are outraged?
The Good News: 340B Price Restrictions Can Be Overcome.
Despite every attempt by drug manufacturers to withhold the reimbursements to which 340B-eligible entities are legally entitled, every one of the 13 health systems ProxsysRx’s 340B team supports has enjoyed significant revenue increases since the advent of 340B ESP. As we reported in a previous post, ProxsysRx quadrupled one entity’s year-over-year 340B savings & revenue in a single quarter. Another 340B health system we serve, a small rural hospital, saw a 900% increase in its monthly net 340B savings over their historical averages. And again, we achieved those increases for that hospital after manufacturer restrictions were implemented.
All that said, we cannot offer you a simple solution for overcoming drug manufacturer 340B restrictions. What we can offer you is an in-depth review of our process — and the technical and human resources we use to achieve results for the 340B entities we serve.
PHASE ONE
Organizing 340B data, coordinating teams
Connecting and educating 340B system providers
In countless hospitals, where in-house personnel (typically Directors of Pharmacy) are absolutely overwhelmed with the responsibility of managing 340B programs in addition to their primary jobs, provider lists are years outdated. For the health systems we serve, ProxsysRx updates provider lists monthly.
When we initiate 340B support for a new client, we review their current provider list, then:
- Confirm the providers still working with the hospital.
- Eliminate, from the list, the ones no longer with the system.
- Identify “new” providers who’ve yet to be included on the list.
- Reach-out to every provider on the updated list, offering them our full support in helping ensure they understand, and take full advantage of, the 340B savings opportunities available to them, their health system and — most importantly — their patients.
- Send the health system’s updated provider list to all of its TPAs (More on TPAs later).
Requalifying all eligible, but unreimbursed, 340B scripts
Once we confirm that a health system’s provider list has updated in its TPAs’ systems, we mine the system’s past 340B prescriptions — up to two years prior to our start date — for still-eligible scripts we can requalify with those TPAs. At that point, the hospital’s 340B program will begin generating significant increases in its savings & revenue.
Retrieving 340B eligible-script data
During this phase, ProxsysRx’s data team works with a hospital’s data team to assemble and deliver the system’s historical 340B-program files. The hospital sets up the feeds using a template we provide that organizes and sorts the data in our 340B PRO software system.
Once that process is complete, a hospital’s script data is automatically fed into our system in a format ready to be re-qualified.
Establishing communication lines between internal and external 340B teams
ProxsysRx’s 340B team leaders conduct twice-weekly calls with the team leaders of the health systems whose 340B programs they’re managing. Monday calls are generally focused on 1) Getting an overview of activity on the hospital’s end, and 2) Taking any new questions or concerns the hospital’s team might have.
Our team spends the week answering the questions and addressing the concerns — and then during Friday calls, we review what we’ve accomplished during the week. And of course, all calls are also focused on building strong working relationships — not to mention mutual trust — between our respective teams.
Why specialized software is essential for successful 340B programs
Given the complexity of the 340B program and the ever-shifting sands of manufacturer restrictions, not to mention the tens of thousands of prescriptions the average covered entity submits in a year’s time, a specialized software solution is absolutely critical. Without one, an adequately-managed 340B program would easily require a dozen full-time employees manually monitoring prescriptions to optimize savings and revenue.
The two most important benefits that customized should offer are: 1) Automation of time-consuming processes that would be otherwise done manually, and 2) Production of analytics, and actionable intelligence, that enable 340B teams to make better decisions faster. The biggest problem with managing a 340B program is the mountain of collected data which is used either inadequately, or not at all.
The central problem with most 340B programs’ data
Because most healthcare data is “siloed,” the typical 340B hospital places patient information, insurance information and 340B pharmacy data in separate silos. Worse still, none of those silos are designed to enable easy communication with one another.
ProxsysRx’s 340B Analytics platform safely and securely consolidates all of a health system’s 340B data in a single location, then delivers it, coherently, to 340B team members — enabling them to make good decisions fast.
Customized 340B software should be able to automatically document the journey of every eligible prescription written — from the providers to the retail and specialty contract pharmacies, and from billing to claiming-and-qualifying for 340B reimbursement.
Why 340B software alone is not enough
The critical role humans play in the 340B software equation
Let’s start with the challenge of dealing with TPAs. While it’s true that, every year, ProxsysRx’s software identifies tens of millions of dollars’ worth of 340B-eligible prescriptions missed by TPAs, software alone can’t reliably requalify most prescriptions for reimbursement. There has to be a reason a prescription is requalified. A reason that can be defended if a 340B prescription is ever challenged in an audit.
That kind of reasoning requires 340B knowledge, insight and judgment on a per-prescription basis. Even with automation, it’s a time-consuming process. Which goes back to something we intimated earlier: No health system’s 340B program can succeed without at least one full-time, experienced professional at the helm.
Not only does ProxsysRx assign teams to manage the 340B programs of every health system we serve, our teams communicate with each another on a daily basis — sharing ideas, and reporting on new problems they’ve encountered (which also occurs on a daily basis).
ProxsysRx VP Heather Brooks is quick to point-out that collaboration is the absolute cornerstone of our 340B program’s culture. “Everyone on our team is encouraged to speak-up whenever they have ideas or suggestions, and all of us understand that each one of us brings value to the team.”
PHASE TWO
Deepening 340B insights, then applying them
When every prescription’s journey is tracked end-to-end, a hospital’s 340B team can constantly improve its understanding of their 340B program. Using their software’s analytics, they can begin to see patterns. With ProxsysRx’s 340B Analytics’ reporting capabilities, our teams also help health systems close the gaps in their 340B programs.
Closing 340B program gaps
We’ve seen it in nearly every health system we serve: Clinics with potential to generate 340B income not taking advantage of their opportunities. Using data that demonstrates unmet 340B-savings potential — supplemented with insights explaining where changes can be made — our teams help health systems become more effective in generating 340B savings.
Reporting 340B prescriptions by drug and provider
Your analytics platform should provide reporting for every 340B-eligible prescription, and every individual prescriber, enabling you to determine the 340B savings you’re generating on each drug — as well as the physicians and contract pharmacies qualifying eligible prescriptions for 340B reimbursement, not to mention are not.
Helping your providers & contract pharmacies better serve your 340B patients.
With the reporting data produced by your analytics platform, you help your providers better serve their 340B patients, and you can identify the pharmacies that best serve those patients’ needs — and your 340B program as a whole.
Making better 340B program decisions faster.
The primary advantage that comes from an optimal combination of process-automation and human insight is the ability to react quickly to external changes to how 340B prescription claims are submitted — and again, that happens almost daily.
PHASE THREE
Building-out 340B program “infrastructure”
Optimizing the number and quality of 340B eligible contract pharmacies
If your health system is managing its own 340B program, there’s something you should know: Your contract pharmacy network is not what it should be. Since ProxsysRx launched its 340B Support program in late 2019, we’ve never encountered a single 340B health system whose 340B contract pharmacy we couldn’t improve.
Among the 13 hospitals whose programs we manage, the average number of quality 340B contract pharmacies we’ve added is five to ten. In some instances, we’ve added as many as thirty contract pharmacies to a client’s network. What’s more (hard to believe but true), we routinely identify quality 340B contract pharmacy partners located literally within walking distance of hospitals we serve!
For more tips on optimizing your contract pharmacy network, Click Here.
Capturing 340B savings with onsite pharmacies — retail and specialty
RETAIL PHARMACY
Not only can and should a well-managed retail pharmacy generate significant revenue and profits for your health system, it can serve as an integral part of your 340B program — in a number of ways. For starters, coupled with a well-run Meds To Beds program, it can help you serve more 340B patients — by establishing relationships with them before they’re discharged. Just as importantly, your onsite retail pharmacy can serve as a communications and coordination hub between your 340B patients, providers and — ideally — your onsite specialty pharmacy.
From a financial perspective, an onsite pharmacy helps you minimize 340B losses to manufacturer restrictions requiring entities to fill prescriptions for certain medications only at contract pharmacies within an arbitrarily-determined distance from your main campus. What’s more, you can use 340B savings from your retail pharmacy to help fund your hospital’s own onsite specialty pharmacy.
To download ProxsysRx’s Resource Guide outlining how to use 340B to pay for an onsite specialty pharmacy, Click Here.
SPECIALTY PHARMACY
We cannot overemphasize the importance of an onsite specialty pharmacy to hospitals participating in the 340B program. From a clinical perspective, an onsite 340B pharmacy enables you to offer critical, specialized care to your health system’s sickest patients — and, in many instances, pass-along 340B savings to patients who are unable to afford their medication.
Financially, specialty pharmacies can generate significant 340B savings for covered entities. It’s not uncommon for 340B hospitals with onsite specialty pharmacies to generate as much as 600% in revenue from 340B specialty drug prescriptions as they do from traditional retail pharmacy 340B prescriptions.
That said, because specialty drugs are so expensive, they’re frequently targeted by manufacturers for harsh and unlawful 340B restrictions. An onsite specialty pharmacy can help you overcome many of those restrictions — particularly the one regarding using only pharmacies within a certain radius of your campus.
For an overview of Specialty Pharmacy Best Practices, Click Here.
Supporting patients, and your 340B program, with Meds To Beds
A well-managed Bedside Prescription delivery program is more than a tangible, and much-welcomed, sign of your commitment to caring for your patients and their families. It’s an exceptionally cost-effective service that helps ensure patients leave the hospital under your care — by providing the medications AND the clinical support they need at discharge. It also enables your health system to keep 340B patients under your care, post-discharge.
In every 340B hospital where ProxsysRx manages Meds To Beds programs and onsite pharmacies, a significant percentage of patients continue using our pharmacies for refills, and even new prescriptions — because they’ve found we offer them better service, better clinical support, AND (when needed) better access to financial support for their medications.
All of which brings us to dealing with 340B and other manufacturer restrictions.
Eight tips for dealing with 340B ESP
1. Establish communications between your providers and your pharmacies.
Manufacturer restrictions make it more important than ever to have onsite retail and specialty pharmacies helping your health system capture as many 340B-eligible prescriptions as possible. Not only with this ensure that more savings stay within your system, it enables you to pass-along more savings to the patients in most need of financial support.
2. Provide only the data 340B ESP requires.
In the same way that a trial witness should always only the questions they’re asked on cross-examination, your health system should never submit more data than 340B ESP asks for — including NDCs from the manufacturers imposing 340B price restrictions, and only those manufacturer NDCs. You should also have a dependable process for scrubbing your TPAs’ reports before submission.
3. Don’t count-on 340B ESP to restore prices on its promised scheduling.
340B ESP says you should allow 10 days, post-submission, for 340B prices to be restored in your contract pharmacies’ 340B wholesaler accounts. Don’t count on that happening consistently.
4. Don’t count-on 340B ESP price restoration at all.
Just because 340B ESP reports that a 340B price restoration has been made, that doesn’t mean it actually has.
5. Don’t expect submitted eligible dispenses to get you 340B price access.
Since many 340B dispenses occur in increments below full-package-size, it can take months and multiple claims to make a full reorderable package. But some manufacturers won’t allow 340B purchases past 45 or 60 days from dispense, which means you’ll probably never get many of the 340B prices you’re entitled to.
6. Don’t assume that 340B ESP will be compatible with your TPAs’ reports.
You can’t just pull reports as-is from your TPAs and upload them, when submitting your own reporting to 340B ESP. You have to submit your uploads in ESP’s singular format, subjecting every upload to potential pitfalls that result in failures.
7. When you ask 340B ESP for help, don’t count on getting it easily.
There are times when we need answers from 340B ESP. In our experience, they are never responsive. If you don’t push them, you won’t get their help.
8. Decrease your reliance on outside contract pharmacies.
While this seemingly contradicts our prior advice about optimizing your contract pharmacy network, it actually doesn’t — and here’s why: On one hand, you do want to offer your patients as many pharmacy options as possible. On the other hand, filling as many 340B prescriptions as possible through your in-house retail and contract pharmacies enables you to overcome many manufacturer restrictions specifically related to outside pharmacies.
At the same time, as previously mentioned, using on-site pharmacies enables you to offer patients better quality and continuity of care. And, of course, the best way to maximize the number of 340B patients using your onsite pharmacies is by offering superior clinical care and personal service, greater convenience (including home prescription delivery) and better access to financial support when needed.
ProxsysRx is here to help, if you have questions.
There are so many ways to optimize your 340B drug program savings and benefits. For more information on any aspect of developing and managing a successful 340B program, contact:
HOWARD HALL C: 214.808.2700 | howard.hall@proxsysrx.com
