How 340B Program Changes Impact Specialty Pharmacy Billing Services Today

No wonder that all the hospitals and clinics always aim to provide their patients with the best possible care and to do that, you need to buy various clinical resources at the lower price. The 340B drug pricing program is solely designed help you purchase drugs at reduced price so that you can better serve the vulnerable patients. The new rules and regulations have already changed how the specialty pharmacy drug pricing should work in recent years, thus impacting your overall specialty pharmacy billing services and overall reimbursements. You really need to understand what 340B drugs program is and what’s changing in that particular step.

Know what 340B program is:

The 340B program was first launched in 1992 with the purpose of making specialty drugs more affordable for low-income and uninsured patients. This particular program helps people buy outpatient drugs at the discounted rate of 25% to 50% from manufacturers itself. Your specialty pharmacy always plays a vital role in dispensing those costly drugs for chronic diseases like cancer. Unfortunately, you cannot expect to have a smooth reimbursement process for 340B drugs as the whole process is complex and keeps changing. Here is a simple example-you have already dispensed a cancer drug under 340B pricing but the reimbursement depends on the payer’s policy, causing serious confusion and impacting your bottom line.

Now, it’s time to know what’s changing in the landscape of specialty pharmacy billing services due to 340B program.

The new changes in 340B program in the specialty pharmacy billing service landscape:

The whole 340B ecosystem has been gone through some vital changes and some of the biggest changes include-

1. Restriction set by manufacturer:

A lot of specialty drug manufacturers are now limiting their 340B discounts as they believe that the contract pharmacy arrangements have grown exponentially and clinics often misuse them. Manufacturers are now requiring you to provide them with proper proof that your patient is eligible, thus creating confusion for you when relying on such partnership with hospitals or clinics. Your access to discounts, reimbursements and profit margins get directly reduced.

2. Legal complexities:

No wonder the 340B program has already become a legal battleground now as courts, states and federal agencies are directly involved here. It is true that The U.S. Department of Health and Human Services (HHS) still want manufacturers to honor 340B pricing, but manufacturers still keep challenging the rule. Your specialty pharmacy billing service suffers for it as the reimbursement has already become harder now. You can frequently face payment delays, claim disputes and higher administrative costs without a specific set of clear rules.

3. Changes in contract pharmacy arrangements:

We all know that covered entities could use several contract pharmacies to cater to more patients, but now they may operate with fewer partners as the restrictions have been tightened. It means fewer prescriptions flow through your specialty pharmacy, thus leading you to face fewer reimbursement opportunities. A lot of health systems are now trying to bring their 340B dispensing “in-house” to enjoy better control and you can lose contracts if you are outside those health systems. Lets go through an example here- Bristol Myers Squibb already announced that covered entities that do not have in-house pharmacies could designate up to three contract pharmacy locations. Now, you might have realized how it can cause reduced access and financial strain for your specialty pharmacy.

4. Pressure caused by audits and compliance:

The number of audits increased from both manufacturers and payers and the reason is simple- to make sure 340B claims follow all the rules. Each drug must be dispensed to an eligible patient for a proper encounter and you also need to be an eligible entity. You can face claim denials because of small mistake in your documentation process. Specialty pharmacies now need to spend more time in eligibility checking, managing data and staying compliant, thus causing more operational costs for you.

Now, you should know how all these changes affect the reimbursement in your specialty pharmacy billing services.

Read More:

How A Specialty Pharmacy Billing Company Tackles Payment Risk?

How the 340B changes affect reimbursement in specialty pharmacy billing services:

1) Reduced margins:

Specialty pharmacies always lose a vital financial advantage when manufacturers limit access to 340B discounts. We all know that specialty drugs are really expensive so a small reduction in discount or reimbursement can cost you a significant amount of money.

2) Delayed payments:

Your payments always get delayed by policy uncertainty and more audits. You should carefully check every claim and sometimes provide additional details for proving eligibility. The whole process may even take a few weeks or even a month, thus slowing down your cash flow and making it harder for you to run specialty pharmacy.

3) Complex process of managing claims:

It has never been easy to ensure a smooth specialty pharmacy billing service under 340B program. You need to handle multiple data feeds, adhere to different payer rules and meet all the manufacturer reporting requirements. Each payer handles 340B drugs differently with unique set of codes, modifiers and reimbursement rates. Your claims can be denied or underpaid if your billing team is not careful enough.

Now, you have probably realized how difficult it is to manage specialty pharmacy billing services, especially when 340B program is concerned. Unfortunately, many specialty pharmacies lack professional teams to handle all these nuances. You can hire a professional specialty pharmacy billing company if you are one of them. However, you cannot expect to have the best experience from every billing vendor and this is exactly where, a specialized company like SunKnowledge Inc. can be your best resort.

SunKnowledge: Your ideal destination for managing specialty pharmacy billing services

SunKnowledge can help simplify everything if you face specialty pharmacy billing issues, delayed or reduced payments due to 340B program. We support both providers and payers being one of the leading RCM service providers. We handle patient records, demographic entries, prior authorizations, coding, refill management, claim submission, AR follow-ups, and payment posting with 99.9% accuracy. Our services reduce operational costs by up to 80%, prevent claim denials, and provide dedicated account managers at no extra cost. Your specialty pharmacy billing becomes efficient, compliant, and stress-free with us at $7/hour!