Why Hospitals Need a 340B Purchasing Strategy

340B Insight

Health systems eligible for 340B savings must strike a balance by staying compliant with purchasing rules while also maximizing the amount of eligible savings they can obtain to invest in patient care. Angela Campitelli, the director of the pharmacy 340B program at MetroHealth System in Cleveland, explains how a hospital system such as hers implements a purchasing strategy that achieves that balance.

Following rules for 340B purchases

Disproportionate share (DSH) hospitals, children’s hospitals, and cancer hospitals are subject to a group purchasing organization (GPO) prohibition that bars them from buying covered outpatient drugs on GPO accounts. That requires maintaining a purchasing system that involves buying drugs at wholesale acquisition cost (WAC) for neutral inventory and then replenishing at 340B, WAC, or GPO pricing depending on how the drug is used.

How the cycle can break down

Purchasing drugs outside of the outlined processes could cause violations of the GPO prohibition or other 340B rules, which could lead to sanctions that might include losing eligibility for 340B. That is why health systems such as MetroHealth use staff education, regular auditing, and other safeguards to ensure they are purchasing and replenishing drugs on the correct accounts.

Investments in the strategy

Campitelli recommends 340B hospital teams bring their senior leadership on board to invest in auditing and other resources to ensure a strong purchasing strategy. Such investments will help avoid potential rule violations while ensuring that hospitals are not walking away from 340B savings to which they are entitled.

Resources

1. 340B Health Appeals Rebate Ruling; Federal Court Agrees to Fast-Track Drugmaker Appeals