What is a 340B Contract Pharmacy?
A contract pharmacy is a retail pharmacy who has a contract with a 340B eligible entity. Entities who participate in the 340B program and do not have in-house pharmacies sometimes seek to establish a relationship with a contract pharmacy.
This allows the hospital to dispense the drugs that it purchases at discounted prices through the 340B program to its patients, reducing its overall costs and allowing the hospital to stretch its care to more people in need.
Is a 340B Contract Pharmacy beneficial?
340B entities save money on drug purchases through the 340B program. Contract pharmacies are able to serve 340B patients by filling their prescriptions from the covered entity. These services are recorded by a process established between the covered entity and the contract pharmacy. This inventory is then replenished by the 340B hospital at the program’s discounted price. In this way, both the hospital and the contract pharmacy benefit financially from the 340B program discounts and are able to save money and extend their resources to a wider patient base.
340B Contract Pharmacy Services – From A to Z
340B Contract Pharmacy Eligibility
Any retail pharmacy is eligible to become a contract pharmacy by establishing a relationship with a 340B entity. Before they are allowed to inventory and dispense 340B discounted medications, a contract pharmacy must be approved by the Office of Pharmacy Affairs and must be listed on the 340B database.
Contract Pharmacy Registration
If you are considering registering a contract pharmacy, there are a few steps that should be followed to ensure you do not misfile and delay the approval of your contract status.
1. Contact Maxor for guidance in the Contract Pharmacy Registration process
2. Familiarize yourself with the Database Guide for Contract Pharmacies
3. Visit the HRSA website to register the contract pharmacy (Registration periods are: 1-15th of October, January, April, and July)
4. Get in contact with your covered entity. They will receive instructions on certifying your status as a contract pharmacy in an email. This process must be complete within 15 days of the online registration request submission.
5. Establish the details of your arrangement with your covered entity.
Ship to /bill to Arrangement
Since drugs purchased at discounted prices through the 340B program must be billed to an eligible 340B entity, the ship to / bill to process is a simple solution to ensure that the contract pharmacy is receiving the necessary prescriptions to serve its 340B patients. The 340B Hospital sets up an account with the contract pharmacy’s wholesale provider and orders medications to be shipped directly to the contract pharmacy’s location in order to renew the stock as it is supplied to 340B patients. This allows the contract pharmacy to maintain the necessary inventory to serve its clients and 340B patients while benefiting from the discounted prices and adhering to 340B program requirements.
Split Billing is the process of separating medications purchased through 340B and the ones purchased ordinarily or through other discounted programs such as Medicaid. It is important that this process be set up and strictly monitored by the covered entity. This is to ensure that no entity is receiving duplicate discounts (where orders receive discounts from 2 programs) and to avoid diversion (the use of 340B discounted drugs to fill non covered patient prescriptions.) Maxor has a well-established method of split billing that can be implemented to ensure 340B compliance.
In-house pharmacies are operated directly on site by the 340B covered entity. There are many advantages to establishing an in-house pharmacy. By operating your own in-house pharmacy, you can more closely monitor medication adherence in real time. This allows your providers the ability to greatly enhance your quality of care. In-house pharmacies also avoid the troubles of ship to / bill to arrangements and any confusion that may arise due to inventory operations.
Maxor 340B Contract Pharmacy Integration
When Maxor builds out a comprehensive on-site pharmacy solution for a covered entity, we assume the management responsibility for all associated child sites and contract pharmacies. Our compliance and review excellence allows us to audit wholesalers, cross reference inventory systems, and track processes to absolutely maximize the profits and savings associated with all related sites. This allows you to stretch your funding to fulfill your core mission of improving patient care. Learn more about how we can integrate compliance services throughout the entirety of your infrastructure with The Maxor 340B Program Solution.