340B PREVENTING DIVERSION IN DSH

1. 340BPREVENTING DIVERSION IN DSH

2. RESTRICTIONS Resale or transfer of discounted drugs to any other than a patient of the covered entity is prohibited Medicaid cannot be billed more than acquisition cost plus dispensing fee for take-home prescriptions.

3. PATIENTS OF COVERED ENTITY Medical record Physician must be on staff The cost of care must be listed on the reimbursable section of the Medicare Cost Report More restrictions proposed

5. BACKGROUND 373-bed acute care facility owned and operated by the County of San Bernardino Training programs Family Medicine, Internal Medicine, Surgery, Neurosurgery, Women�s Health, ED, Geriatrics, Pharmacy Practice, Psychiatry Large indigent population Home care House calls

6. OUTPATIENT PHARMACY 1800-2100 prescriptions per day Automation Interactive system for refill requests

7. 340B HISTORY Joined the pricing program in late 1993 Obtained retroactive rebates Immediate impressive savings Currently saving approximately $10.5 million per year

8. OPPORTUNITIES FOR DIVERSION Using 340B drugs in inpatients Selling to other hospitals in the area Selling to providers� private offices Filling prescriptions for patients not seen at the covered entity Employees Failure to separate inventories

9. PATIENTS OF COVERED ENTITY Definition Allowed exceptions: Prescriptions originating pursuant to an ED visit for a medically urgent condition. Patient requiring services not provided by the covered entity Provided that covered entity retains primary medical relationship NOT allowed: Patient seeing non-covered entity provider for convenience

10. EMPLOYEES Test question: Was the employee seen at a clinic/office within the hospital? Not enough for covered entity to be self-insured Stay tuned�

11. MANAGING THE INVENTORY Must separate 340B from inpatient inventory Cannot �cherry-pick� (GPO exclusion) Physical vs. virtual separation Replace GPO purchases with 340B Must replace with same NDC number Must keep good records 340B law provides for audits

12. VIRTUAL INVENTORY SOFTWARE Commercially available from: ABC Talyst Cardinal McKesson Excel or Access databases

13. EXECEL OR ACCESS DATABASE Download data from hospital�s pharmacy system. Data elements needed: Drug name and strength NDC number Date of service Quantity dispensed Populate spreadsheet with pack sizes Generate list of items to order

14. SUMMARY Internal compliance audits Enforce the rules Resist temptation There is a lot at stake!

15. Andrew Lowe, Pharm.D.(909) 580-0051lowea@armc.sbcounty.gov