A 340b pharmacy program allows covered hospitals, qualified entities, and healthcare systems to purchase outpatient drugs at discounted prices. Drug wholesalers and manufacturers that participate in Medicaid provide these medications through specialty pharmacies to eligible patients of covered entities and qualified healthcare systems at reduced 340b prices.
The program has been under heavy scrutiny lately, with many manufacturers protesting and dropping out of the program. Many states have begun taking positions on the matter, enacting legislation and setting rules that have impacted local hospitals. As we've seen in 2024 so far, discussions surrounding the 340b drug pricing program remain integral to broader market conversations. Issues around distribution, patient eligibility, and the use of 340b drugs in ambulatory infusion models persist. As new models emerge, there's a growing emphasis on patient data and effective patient engagement strategies to retain patients across the prescription continuum.
Related Topics: 2024 Pharmacy Trends & Developments
Challenges in Optimizing the 340b Program
Healthcare organizations and pharmacies face several hurdles in optimizing the 340b program:
- Preventing medication diversion to ineligible patients.
- Avoiding duplicate discounts by not using 340b pricing in conjunction with other group discounts.
- Maintaining auditable records and passing regular audits.
- Filling as many prescriptions within your own pharmacy system as possible.
The struggle to capture the necessary 340b patient data required by the program has driven the growth in a cottage industry of data management companies and contract pharmacies. The optimal, yet most difficult solution is to maintain the patient relationship throughout the prescription journey within your own organization and hope for the best. Alternatively, organizations have begun paying third parties to manage patient data, driving the dollar volume to a level that has caused manufacturers to take pause and question where the program has gone and push for some reform. There are always two sides to every story, in the end, some form of compromise will be found.
Amidst the debate in the 340b space, hospitals that can both manage patients and fill their prescriptions are in a safe harbor - perfectly positioned to optimize 340b.
The Importance of Efficient Prior Authorizations with 340b
Everyone can agree the prior authorization process is difficult, frustrating, and costly. For patients on specialty life-saving therapies, every moment counts. In an inefficient healthcare system, with specialty pharmacies and a 340b pharmacy network, 20-50% of prescriptions for specialty therapies may be incomplete, lost, misrouted, or abandoned. This issue leads to significant lost revenues and poor patient care.
An automated, efficient, and transparent prior authorization system creates two key changes necessary to optimizing 340b:
1. Patients can get on therapy faster.
With a transparent PA journey, patients can begin vital therapy in hours or minutes compared to the delays of many days with inefficient legacy systems. Having spoken to and partnered with hospitals seeking 340b optimization, we've seen organizations lose over 20% of their 340b opportunities due to these inefficiencies. These quicker approvals enable organizations to maximize their revenue and maximize long-term patient retention.
2. Patients are more likely to have their prescriptions filled at your contracted pharmacy.
D2's prior authorization management platform, UltraTouch Verify, ensures that prescriptions are captured and directed to your 340b pharmacy. By prioritizing this within the system itself, automated prior authorization systems can maximize and optimize the use of your organization’s contracted 340b pharmacies.
UltraTouch Verify is Helping Hospitals with 340b Optimization
D2’s Prior Authorization management platform, UltraTouch Verify, significantly reduces the time required to obtain approvals and start patients on all products, including 340b medications. Designed to streamline the PA journey, 67% of all prior authorizations submitted through Verify are approved on the first submission with a reported 50% reduction in time spent managing them by our hospital and specialty pharmacy partners.
Let's shape the future of healthcare delivery - together.
For more insights on optimizing your hospital operations or how D2 can best support your organization, schedule a time to connect with me or contact us directly at connect@d2rx.com.