Preparing for a Neutral 340B Claims Clearinghouse

July 23, 2024 Views

Ramifications and How to Get Ahead of the Curve

Proposed 340B Legislation – The Call for a Clearinghouse

Multiple pieces of proposed legislation in Congress include the establishment of a clearinghouse. These include:

340B PROTECT Act: This bipartisan House bill, which was introduced last year by Reps. Spanberger (D-VA) and Johnson (R-SD), aims to address Medicaid duplicate discount issues through the establishment of a neutral clearinghouse operated by a federal contractor. It would segregate 340B program claims data from rebate requests, preventing manufacturers from accessing sensitive information.

SUSTAIN 340B Act: This bill, which is expected to be released prior to the August recess by bipartisan group of Senators, aims to expand the clearinghouse concept beyond Medicaid drugs to include Medicare drugs and possibly commercial claims.

340B Access Act: This Republican-sponsored bill, supported by PhRMA and NACHC under the name ASAP 340B, advocates for a clearinghouse that would encompass all claims, including those from commercial sources.

CMS Draft Guidance: Released in June 2024, this guidance addresses the risk of duplicate discounts related to the Maximum Fair Price (MFP) and the 340B price. Pharmacies enrolled in Medicare Part D would be required to submit claims to a CMS contractor, who would then share claims data with manufacturers to identify and potentially withhold refunds on transactions involving 340B program discounts.

Existing 340B Solutions and Their Problems

The 340B program faces challenges that manufacturer-driven solutions (e.g., 340B ESP) and Covered Entity (CE) solutions (e.g., Third Party Administrators/TPAs) fail to adequately address.

Manufacturer-driven solutions like 340B ESP, run by a vendor called Second Sight, are designed to manage duplicate discounts but have evolved to restrict access through contract pharmacy restrictions. These solutions do not align with market-driven principles prioritizing collective benefits over individual interests.

CE-driven solutions also face neutrality concerns. TPA solutions require managing multiple vendors without a centralized platform, leading to data disparities and a lack of mutual trust between manufacturers and CEs. Neutrality remains a critical issue for both TPAs and ESP, highlighting the need for a solution addressing industry-wide challenges rather than specific stakeholder concerns.

A neutral clearinghouse benefits manufacturers, CEs, and payers alike. Manufacturers can identify 340B duplicate discounts to avoid paying rebates or recover already paid rebates. CEs can automate claims submission in compliance with non-duplication rules. Payers can ensure program compliance in rebate submissions and recover inappropriately rejected claims as 340B. A clearinghouse must solve industry-wide problems, not just stakeholder-specific issues.

340B Clearinghouse Implementation

If the SUSTAIN 340B Act or 340B Access Act is enacted, a centralized, neutral 340B clearinghouse would be mandated for both governmental and commercial claims. The Protect Act would be limited to Medicaid claims. The goal would be to eliminate duplicate discounts, prompting manufacturers and CEs to transition from or adapt current models.

The smooth implementation of a clearinghouse would require an intentional and structured program, including a registration phase, account management protocols, and data submission requirements. The implementation process would onboard thousands of CEs to the clearinghouse. A simple, streamlined process would be critical to success.

While the details have not been fleshed out yet, here is a likely scenario for implementation:

Registration: During this phase, CEs would be onboarded to the clearinghouse. An OPAIS Authorizing Official would oversee program responsibilities and regulatory updates, while a primary contact would handle day-to-day implementation status and clearinghouse developments. The clearinghouse vendor would engage CEs, facilitating straightforward registration from both procedural and technical standpoints.

Delegation/Account Management: Some CEs may delegate registration and claims data submission tasks to a TPA. The primary contact would coordinate with the TPA to ensure proper registration and data upload. Maintaining accurate information in the OPAIS and HRSA systems through regular audits and updates would be crucial. CEs unfamiliar with ESP would need guidance to adapt, and the clearinghouse vendor would offer training and resources.

Data Submission: Meeting data submission requirements would be essential. Changes from current data extracts would be reviewed by the primary contact. TPAs/CEs would learn to register and conduct testing with the correct file formats. Secure data transfer protocols via a Secure File Transfer Protocol (SFTP) platform, HiTrust certified for security, would ensure patient information is safeguarded.

The Way Forward

In conclusion, the 340B clearinghouse implementation would require a straightforward approach to ensure seamless integration and compliance across all participating CEs and stakeholders. Emphasizing account management, data security, procedural clarity, and effective communication channels, all stakeholders could meet legislative requirements and support a successful 340B program. Watch RxParadigm’s 340B Clearinghouse Ready Webinar June 2024 RxParadigm’s 340B Clearinghouse Ready Webinar June 2024 (youtube.com) for an in-depth discussion on the 340B landscape.

Mesfin Tegenu is CEO and Chairman of RxParadigm, a technology solutions provider committed to supporting initiatives that advance the 340B program. He can be reached at Mesfin.Tegenu@rxparadigm.com.