Prepping for HRSA Audits

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Are you truly ready for a HRSA audit? Today we have two 340B experts, Dennis Killian and Heather Erickson, from CPS Solutions, LLC. (CPS) here to discuss three topics that will help you prepare. CPS has managed 340B Programs for hospitals and health systems since the program’s inception, ensuring compliance with the 340B statute, HRSA guidance, as well as best practices from across the industry.

The following is a transcript of the above video:

Dennis Killian: Hi, everybody. My name is Dennis Killian. I’m a pharmacist with the CPS Solutions, LLC. (CPS) 340B team, and I work with a lot of covered entities across the nation. We help them with a variety of different services, whether it’s compliance monitoring or to help them optimize their program, basically whatever they need.

Heather Erickson: Absolutely. Thank you so much. My name is Heather Erickson. I’m a consultant on the CPS 340B Solutions team, I’ve been with this team for about 4.5 years, in the 340B space for the past 14 years. Really, we help cover entities with all sorts of compliance and optimization initiatives. And I really take joy in helping covered entities succeed.

As we approach the end of the year, we hear the auditors have been very busy. Tell us: What are you seeing in the field? Can you share any examples of variances between auditors?

Dennis: Sure thing. I’ll go ahead and start off. We are working with a lot of covered entities right now with HRSA audits. And luckily, the HRSA auditors have a fairly structured process that they work with, with covered entities. However, we do see some variations from time to time, whether it’s with specific auditors or the specific format for an audit. One of the things that we’re seeing this year is HRSA has revised their data request list, which we commonly referred to, as just DRL for short.

And there’s a chance they update actually every fiscal year, the government fiscal year runs from October to September, and they did make some changes this year. So we work with covered entities to help navigate that piece. That’s one of the big things that we’ve been working with this year.

Heather, you’ve worked with several covered entities on their audits recently. Are there any specific scenarios that come to mind that others should be aware of?

Heather: We’ve seen a recent uptick in the focus on purchasing during a HRSA audit. How a covered entity is managing their inventory, the purchasing accounts they’re using, and the methodology for how they’re dispensing those medications and tracking them to eligible patients.

And Dennis, when it comes to some of the big changes you’ve noticed on the DRL, what’s different? And why is it changing now?

Dennis: Sure. Like I mentioned, there’s a chance that the DRL is updated every year. For this most recent fiscal year, we’ve seen changes related to Medicaid fee for service. For instance, if you’re if an entity is carving out Medicaid fee for service and either an entity-owned pharmacy or a contract pharmacy person wants to know the specific BIN and PCNs that are being carved out.

So that’s new. And then the other piece is related to carving in Medicaid. So if an entity carves in Medicaid for their entity-owned pharmacy or contract pharmacy, they have to supply a specific claim data for Medicaid fee for service to show how they are carving those Medicaid claims in. And so that’s new. And it’s good for sites to be able to see what the DRL looks like.

So we do refer sites to the Apexus PVP website, so we’ll put a link to that in the transcript. And you can see kind of an example DRL and some of these elements that I’ve talked about. (Sample HRSA 340B Audit Request List (DRL) for Covered Entities)

As we know, the 340B program is constantly changing and in flux. Can you talk to us about the headlines we’re seeing about the impact of the Genesis case? What are you keeping an eye on going into 2024?

Heather: So the Genesis case was a big one for 340B and it’s been going on for the past several years. Genesis is a federally qualified health center and had a HRSA audit back in 2017. There was a finding issued by HRSA relating to the patient definition and prescriptions they were carving into their program. Genesis did not agree with the finding and challenged HRSA in court over it, and we recently saw the judge side with Genesis stating that the 340B statute does not support a really rigid patient definition, and covered entities should be able to kind of craft that as it relates to their entity.

So this could have big implications for 340B programs going forward and claims that they are able to bring into their program for their patients. So definitely something that we’re watching for any appeals or for any new interpretations or guidance that may come down as a result of this recent finding.

Dennis: Yeah, that’s a big one.

Dennis: Thanks, everybody, for joining us today for our session and thank you for 340B Report for hosting us. If you’d like to learn more and contact us, feel free to reach out to us on our website at CPS.com/contact-us. Thanks again.

Heather: See you!

Dr. Dennis Killian headshot

Dennis Killian, director of 340B Solutions at CPS, can be reached at Dennis.Killian@cps.com.

Heather Erickson, 340B consultant at CPS, can be reached at Heather.Erickson@cps.com.

Disclaimer: CPS Solutions, LLC is not engaged in the practice of medicine or the practice of law and does not provide medical or legal advice. © 2023 CPS Solutions, LLC.

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