It required pharmaceutical manufacturers to provide rebates for medication purchases, based on sales to Medicaid beneficiaries, as a condition of having their products covered by Medicaid.
Overview of the B Drug Pricing Program Background To understand the genesis of the B drug pricing program B programone must begin in when Congress created the Medicaid rebate program to lower the cost of pharmaceuticals reimbursed by state Medicaid agencies.
InCongress extended to safety-net providers the same kind of relief from high drug costs that Congress provided to the Medicaid program with the Medicaid rebate law.
Under the PPA, the manufacturer agrees to provide front-end discounts on covered outpatient drugs purchased by specified providers, called "covered entities," that serve the nation's most vulnerable patient populations.
The definition of "covered entities" includes six categories of hospitals: Hospitals in each of the categories must be 1 owned or operated by state or local government, 2 a public or private non-profit corporation which is formally granted governmental powers by state or local government, or 3 a private non-profit organization that has a contract with a state or local government to provide care to low-income individuals who do not qualify for Medicaid or Medicare.
There are also ten categories of non-hospital covered entities that are eligible based on receiving federal funding. Who administers the B program?
How does the program work? Facilities whose registrations are approved by OPA are listed on the OPA database 340b business plan eligible for discounts starting the first day of the next calendar quarter following the one during which an entity completed the registration process.
Once admitted into the program, covered entities are entitled to receive discounts on all eligible covered outpatient drugs. The URA is a minimum rebate percentage of This is true for both single-source, brand-name drugs and brand-name drugs that have generic competition.
Generic drugs are not subject to a best price adjustment but, like brand name drugs, must be offered at a greater discount if the price of the drug has increased more quickly than the rate of inflation. In addition, covered entities are free to negotiate discounts that are lower than the maximum allowable statutory price i.
How do covered entities obtain discounts?
Upon registration, a covered entity should contact its wholesaler to set up its B account. OPA is developing a password-protected website for covered entities to access B ceiling prices, but, until the website is launched, a covered entity can request a price list for B drugs from its wholesaler.
The entity may also request a price list for B drugs from a manufacturer. Manufacturers should check the OPA website each quarter to identify the providers that are participating. The manufacturer may not charge more than the B ceiling price to those entities regardless of whether the covered entity purchases pharmaceuticals through a wholesaler or directly from the manufacturer.
A covered entity does not have to join PVP to participate in B and may negotiate sub-ceiling discounts on its own.
However, because PVP can negotiate prices on behalf of a large number of B purchasers, it has been able to negotiate favorable prices and develop a national distribution system that may not be possible for some covered entities to obtain individually.
To whom may covered entities dispense discounted drugs? The B law prohibits the resale or transfer of discounted outpatient drugs to anyone other than a patient of the covered entity. The patient definition guidelines establish a test that individuals must meet to be eligible to receive B-priced drugs.
Under the guidelines, an individual is not considered a patient of the covered entity if the only health care service received by the individual from the entity is the dispensing of a drug for subsequent self-administration or administration in the home setting.
Are there billing restrictions? With respect to drugs dispensed or administered to Medicaid recipients on a fee-for-service FFS basis, the law prohibits using B for Medicaid drugs that are subject to rebates, unless the covered entity complies with certain requirements.
To comply with the duplicate discount prohibition, covered entities must first decide whether they will use B drugs for their Medicaid patients i.Maintain auditable records documenting compliance with B Program requirements.
Covered entities are subject to audit by manufacturers or the federal government. Any covered entity that fails to comply with B Program requirements may be liable to manufacturers for refunds of the discounts obtained.
A Complex Environment. Hospitals participating in the B program can enjoy discounts on drug acquisition costs that appear to provide the underpinnings for a business plan that achieves sound financial margins, while supporting outreach and care for uninsured and underinsured patients.
The B Program offers eligible safety net health care providers access to low-cost medications, which allows them to expand the type and volume of care they provide to the most vulnerable patient populations.
The B Drug Pricing Program requires drug manufacturers to provide outpatient drugs to eligible health care organizations/covered . VIEWPOINT ONLINE FIRST Cost Consequences of the B Drug Discount Program Rena M. Conti, PhD Peter B.
Bach, MD, MAPP C REATED IN , ALITTLE-KNOWN FEDERAL DRUG discount program called “B” allowed a hand-. B Drug Pricing Program Jump to one reason cited for the growth is the opportunity to expand the patient base for drugs purchased under the B discount drug purchase plan. The program allows facilities to purchase outpatient drugs at prices below market.
The Oncology Business Review published a similar report in September The. A Complex Environment. Hospitals participating in the B program can enjoy discounts on drug acquisition costs that appear to provide the underpinnings for a business plan that achieves sound financial margins, while supporting outreach and care for uninsured and underinsured patients.