Holly Russo, Maxor 340B

10 Questions to Ask Your 340B TPA about Your Contract and Fees

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If you have one or more agreements with 340B Third Party Administrator(s) (TPA) to manage your contract pharmacy arrangements, how much do you know about those contracts and associated fees?  Chances are, you don’t know the answers to all the questions that follow.  Be sure to contact your 340B TPA(s) and ask:

  1. How does the TPA charge your covered entity to perform its services? Is it a flat monthly fee per contract pharmacy, a flat fee plus a percentage of savings on 340B approved claims, a percentage of savings, a captured claim fee, or per matched charge?
  2. Does your TPA agreement have a minimum dollar amount threshold for administrative fees per contract pharmacy? 
  3. Are you being charged for switch fees (If your covered entity is being charged for switch fees, do you know what the average switch fee cost is to compare to what you are being charged?), gateway fees, or a bank transaction fee to collect monies owed by the contract pharmacy to your covered entity?
  4. Does your TPA charge a fee for customizing reports?
  5. Does your TPA charge switch fees even when the pharmacy might not charge them for claims data?
  6. Does your contract with your TPA contain a clause in which fees are automatically increased each year the contract is in effect?
  7. Does your TPA charge to change claims status from 340B eligible to 340B ineligible or vice versa?
  8. Does your contract with your TPA have an evergreen clause? If so, how much notice to you need to provide to terminate your contract with your TPA?
  9. Does your TPA retain administrative fee when claims are reversed?
  10. Does the contract with your TPA contain any clauses around the length of time to implement, and penalties if not fully implemented in a set number of days?

Answers to these questions can help you identify areas where you may be able to re-negotiate your contract or consider whether an onsite pharmacy partner might deliver greater value. Maxor can use its extensive experience with a variety of 340B models to help you determine the optimal model given your unique circumstances.

Holly Russo is Senior 340B Director for Maxor. She can be reached at herusso@maxor.com.

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