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340B Insight provides members and supporters of 340B Health with timely updates and discussions about the 340B drug pricing program. The podcast helps listeners stay current with and learn more about 340B to help them serve their patients and communities and remain compliant. We publish new episodes twice a month, with news reports and in-depth interviews with leading health care practitioners, policy and legal experts, public policymakers, and our expert staff.
Narration [00:00:04]:
Welcome to 340B Insight from 340B Health.
David Glendinning [00:00:12]:
Hello from Washington, D.C. and welcome back to 340B Insight, the premier podcast about the 340B drug pricing program. I'm David Glendinning with 340B Health. Our guest today is 340B Health senior manager of Policy and Compliance Rebecca Swartz. It is that time of year again when 340B hospitals need to go through the recertification process with the Health Resources and Services Administration to ensure they can continue participating in 340B this year. I will say that recertification process started Monday, August 11th and will end on Monday, September 8th. So this is a great time to have Rebecca on the show to go over what hospitals need to know about recertification. But before we get to that interview, let's do a quick recap of some of the Latest news about 340B.
David Glendinning [00:01:13]:
HRSA is inviting selected drug companies to apply for a voluntary limited pilot program that will allow them to replace upfront discounts with back end rebates starting next year. In its initial round, the pilot will only allow drugmakers to impose rebate models on the 10 drugs that will be subject to Medicare Part D price caps starting in 2026. HRSA says it could choose to expand the list of drugs after next year following its evaluation of the effectiveness of the rebate model in a 340B program notice. HRSA said it intends to test the viability of a rebate model under which covered entities would buy drugs at wholesale acquisition cost, submit rebate claims to drug makers for drugs they dispense to eligible 340B patients, and receive rebates for the difference between WAC and the 340B price, you can read the show notes to find out more about this notice and read a 340B health statement about the pilot program. And now for our feature interview with Rebecca Swartz. When 340B Health members have a question about a compliance issue, Rebecca often is one of the first people they speak with to find out the answers to their questions. So she's a great person to have on the show to answer our questions about the 340B recertification process. Here's that conversation.
David Glendinning [00:02:42]:
I am here with Rebecca Swartz who is the Senior Manager of Policy and compliance at 340B health revenue. Rebecca, we have not yet had you on the show yet, so I will say welcome to 340B Insight.
Rebecca Swartz [00:02:56]:
Thank you so much David for having me.
David Glendinning [00:02:58]:
So Rebecca, not only are you on the legal and policy team here at 340B Health, but you also happen to be my next door neighbor at the office. So anytime I have a policy or compliance question, I don't have far to go. And the questions we're asking today are about very important compliance issue, which is the 340B recertification process. So let's start with the most important question any journalist would ask, which is why. So why do hospitals need to recertify for 340B eligibility every year?
Rebecca Swartz [00:03:33]:
Yes, David, that is a great place to start. So the need to recertify comes from language written in the 340B statute. And the law's language describes validating eligibility, maintaining records. So it's pretty general, but it does explicitly say that. And it also says that it should be done on at least an annual basis. And that has become an annual process everyone calls recertification.
David Glendinning [00:04:01]:
And so where does this recertification process, as we call it, generally rank in what you would call the broader concept of 340B compliance?
Rebecca Swartz [00:04:12]:
So it's exceptionally important. It's one of the central tenets of compliance. And, and HRSA holds a preparatory webinar before recertification every year. And they always preface the discussion by explaining that 340B program integrity is performed through five primary reps, and that is initial registration, documentation request, audits, entity self disclosures, and the annual recertification process. So it's very important. HRSA emphasizes the importance to program integrity. It really ensures that participating entities continue to meet those eligibility requirements. So for hospitals, that would be ensuring that you are either a public or private nonprofit hospital.
Rebecca Swartz [00:04:59]:
And for those private nonprofit hospitals, you need to make sure that you have those agreements with a unit of state or local government. All hospitals accept critical access, need to make sure that they're meeting that minimum dish percentage threshold. And then if you have any registered child sites, you need to ensure ensure that they're continuing to have reimbursable outpatient cost and charges.
David Glendinning [00:05:21]:
Okay, so hopefully hospitals are listening when HRSA gives that rundown at the beginning of the webinar. But if they're not exactly paying attention, if recertification slips their mind or they don't understand the importance of it, what could happen to a hospital if they fail to recertify?
Rebecca Swartz [00:05:37]:
It's a big deal. You could lose eligibility, which means you no longer have access to 340B pricing. And for some hospitals, this means millions of dollars per year are lost. So law is on the line here. So just making sure that you prioritize the completion of recertification to ensure that you continue your eligibility. There's no lapse. That's really important to the 340B savings that you're able to access. And once you are ineligible, it could be more than a year before the next opportunity to register.
David Glendinning [00:06:14]:
Certainly a lot at stake if you're going a year or more without those savings. We do know speak often with hospitals about how much they rely on those savings. And so this is clearly critical for their ability to continue taking care of patients the way they are now. Okay, so now everybody's sold. Rebecca, you have made it clear to them how important this is. So let's talk about the process itself. Please tell us a little bit about how 340B recertification works.
Rebecca Swartz [00:06:41]:
Yes, so it typically lasts about a month from mid August to mid September. We like to also make sure that people understand that, you know, you have a month from start to finish. And for some hospitals with a lot of sites, that can be a pretty big lift. So, you know, a month might seem like a generous amount of time. But I think once you start the process, it'll become clear that, you know, depending on how many sites you have what you need to update, you might use that full time. So starting early is important. We'll probably be saying that a lot throughout the podcast. It involves logging into OPACE and accessing recertification tasks in the system.
Rebecca Swartz [00:07:21]:
And from what I'm able to see, I don't really have great visibility into OPACE as a non covered entity user. But it seems like HRSA does a good job laying out, you know, what their specific tasks are involved in recertification. And at a high level that is verifying the information for the parent site. Any child sites and any contract pharmacies are up to date and accurate. And then there's also this piece of certifying that you remain eligible and are in compliance with program requirements.
David Glendinning [00:07:52]:
Okay, so when you say that there are people at the hospitals logging into opace, and I guess I'll just say for the people that don't speak in acronyms, that is the Office of Pharmacy affairs information system. Correct? Am I getting that right?
Rebecca Swartz [00:08:07]:
That is right, yes.
David Glendinning [00:08:09]:
Excellent. So if there is a parent site and multiple child sites, there might be a bit of a team here involved in this process. So who are the people at the hospital involved with the recertification process?
Rebecca Swartz [00:08:22]:
Yes, I think that's really important to make sure that people understand that there are just two folks. So it's your authorizing official or AO and then a primary contact PC and the authorizing official has legal authority here. That's going to be the only person that can actually attest to and submit that recertification. Right. The primary contact can and certainly does, I think oftentimes carry the load up until that point of attesting to and submitting the recertification. But your AO is the only person at the organization that can submit it. And for the parent, you can only have one authorizing official. But each child site can have a different primary contact.
Rebecca Swartz [00:09:06]:
So that might be something you want to explore depending on where people you know sit in the organization. And then it's important to understand that while those are the only two that have access to OPACE and can actually carry out the process, you're probably going to be coordinating with a lot of other departments such as Finance, compliance, administration, legal. 340B is very interdepartmental in that way.
David Glendinning [00:09:30]:
Many of the hospitals you've worked with have been through recertification probably many times. And with you helping members through the process, you've seen them go through it many times. So I imagine you've picked up on some best practices that these AOS and PCs can use. So what are some of the things they can be doing during this process to make it go more smoothly?
Rebecca Swartz [00:09:52]:
Yes, so as we said before, start early and make sure that you have the necessary worksheets and other documentation ready to go before you sit down to do it. I will say, unlike initial registration, you can complete recertification in multiple sittings. It doesn't require you to do it in one session, but I think it's still helpful just to have everything up front or everything that you anticipate needing up front. Of course, there's sometimes surprises. We also recommend going through the parent first, the parent site record first, because the confirmations flow down to each child site so that the information will flow to the child site records. And that just makes it a bit easier for you in that way. And then if you have your primary contact go through the records first and have the authorizing official review it after, that can be a way to kind of divide and conquer. And oftentimes your primary contact is a bit more involved in the day to day operations of 340B.
Rebecca Swartz [00:10:58]:
So they might be a little bit more, you know, savvy with OPACE and that type of thing. But for both of them, you know, watch out for emails. Any return tasks from hrsa. Again, I want to give HRSA a plug here. Like, they're very good about Communicating daily the status of recertification. So make sure that you're watching email closely to understand where you are in the process. And then another thing is to take screenshots of each screen. And even if you haven't updated the information, you know, irrespective of that, just take screenshots because you want to make sure that whatever the record shows, your understanding of the record today is what you know remains.
Rebecca Swartz [00:11:42]:
Sometimes things don't update. You know, systems are fallible. So just make sure that you have record of that via screenshots. In that way, if there are discrepancies, that can be a helpful way for you to communicate to hrsa.
David Glendinning [00:11:56]:
Maybe what went wrong said systems are fallible. We know people are fallible too sometimes. And maybe the information doesn't line up correctly the way it should every time. So what happens if one of these reviewers logs into OPACE and comes across some kind of discrepancy or error in what they're seeing there?
Rebecca Swartz [00:12:18]:
Don't panic. Firstly, because it's common that you're going to be looking at a piece of, you know, documentation. Whether that's your cost report. I'm going to say it's generally your cost report. And you're saying, oh, you know, our dish percentage is different than what it should be, or, you know, this child site has fallen off. There's no longer both reimbursable outpatient cost and charges. That's okay. Recertification is really there to make sure that your information is accurate up to date.
Rebecca Swartz [00:12:51]:
So it is the time to make updates to those necessary fields and upload supporting documentation. And also, though you know, as much as recertification is there to verify, validate your information, it highlights the need to check and update OPACE throughout the year. So regular maintenance should be a part of your 340B policies and procedures. But again, don't panic. That's what recertification is built for. Especially if you're not doing things last minute, it should be totally fine. And I also want to say I'm sorry. This is an exciting thing and HRSA seemed very excited when they were rolling this out during their recertification webinar.
Rebecca Swartz [00:13:32]:
So there's this new feature in OPACE that will allow primary contacts to pull back recertification to correct an error or an omission after they've sent it to the AO for attestation. So there's a button that they will press, it's very clear, it says back to PC and it will allow the PC to make corrections, add missing documents, make any additional changes, and then resend the recertification to the HEYO to review. And, you know, there's been times where, you know, you think you're ready and then you realize, oh no, we're missing a worksheet. And this is a great way to ensure that you can do that without having to like, submit it and then it being kicked back to you by H.R.S.A. in the end anyway.
David Glendinning [00:14:20]:
Okay, good to hear. There's a little bit of an undo button, so to speak, if they do run into a situation like that. You had mentioned in that last answer about the need to be updating OPACE throughout the year and not just during recertification. So I'm getting that recertification is not really the only opportunity to update the OPE ACE records.
Rebecca Swartz [00:14:43]:
That's right. And you shouldn't solely rely on recertification. As we know, aside from critical access hospitals, the remaining five hospital types do have a DISH percentage threshold that they need to meet. And so depending on when you file your Medicare cost report, you know, you need to be making sure that the most recently filed cost report still reflects an eligible DISH percentage in, you know, correspondence with your 340B hospital type. So that's really important to be monitoring and making, just ensuring that you remain eligible. Right. And I will say too that the change ref request functionality, it is locked during recertification. The only thing that you can update is your authorizing official.
Rebecca Swartz [00:15:34]:
So should that person change sometime during recertification or you find that you don't have the right person designated, you can and should use the change request feature for that reason. But otherwise, during the recertification process, it is locked because you're essentially it's one big change request in a way. Right. That's sort of the purpose of recertification is to update your records. So yeah, I hope that that helps kind of explain the role of recertification and then, you know, maintenance and throughout the year.
David Glendinning [00:16:09]:
So they do have these change requests you can make throughout the year, but as you mentioned, recertification also a really good time to check the records and make sure everything is is up to date. You know, 340B teams at hospitals have so much to do, so why can't they just wait until the next recertification opens to update those fields with any new info from their Medicare cost report or something along those lines?
Rebecca Swartz [00:16:36]:
Great question. And I think the historical thought was that recertification you could basically wait if there weren't any eligibility concerns. You know, you remained a public or private nonprofit. And then you met that DISH percentage. The thought was, you know, we're still eligible and then we'll just wait until recertification to update our records. Well, in 2023, HRSA rolled out this new feature with the change request where they allowed you to make updates to your qualification information on a rolling basis. We didn't quite understand what the expectation was until we started seeing audit results. And the audits told us that HRSA does expect you to use the change request feature to update your OPACE records with the information from your most recently filed cost report, regardless of whether there's an eligibility concern.
Rebecca Swartz [00:17:33]:
So even if you remain, you know, compliant with the DISH percentage, even your filing and cost reporting period dates need to match the most recently filed cost report in addition to your DISH percentage. So I think there's understandably been confusion around what the expectations are. But we saw findings, we, we even saw hospitals appeal those findings and ultimately HRSA upheld the findings. So they're serious that they want you to maintain accurate records throughout the year. Yeah.
David Glendinning [00:18:04]:
And at the end of the day, if there are going to be audits, we want hospitals to come away with those process with clean audits. So important to be using those change requests. Rebecca, this has all been really helpful information. What should hospitals do if they need more information than what we've covered here or they have concerns about the recertification process?
Rebecca Swartz [00:18:27]:
I think it's understandable that hospitals would. Things are going to come up during recertification, even during your normal maintenance. So it's always good to tap into legal counsel, especially when your authorizing official is taking a look at those seven attestations of eligibility and compliance. You know, if you have concerns about being able to attest to any of Those, consult legal counsel 340B Health. We're here for our members too. Remember that. You know, we have our recertification resource, a registration resource. They're very similar.
Rebecca Swartz [00:19:04]:
And then we have an annual webinar on recertification, so please refer to those resources. HRSA also has a resource on its website. The OPACE User Guide is great as well. Well, they have their annual recertification webinar and then any, you know, unanswered questions, we're here for you through our technical assistance calls. So please reach out to our team with any questions. And then a Pexis call center is also great. They are on standby at the ready to help as well.
David Glendinning [00:19:37]:
Great. I'm glad to hear you are on call for all of those members. I'm also so glad you're on call for me anytime I have questions about any of this that I'm trying to communicate to our members. Next time that happens, I can take that short walk, or if I'm feeling really lazy, I'll just knock on the office wall and we can chat. Rebecca, thank you so much for taking the time to be with us today and we'll hopefully catch up with you soon.
Rebecca Swartz [00:20:02]:
Thank you so much, David. Appreciate it.
David Glendinning [00:20:05]:
Our thanks again to Rebecca Swartz. We have put links in the show notes to all the great resources that Rebecca mentioned, so be sure to check them out. And if you are a 340B health member going through recertification and you have run into an issue, please be sure to call the team so they can help you out. We will be back with our next episode in a few weeks. In the meantime, as always, thanks for listening and be well.
Narration [00:20:32]:
Thanks for listening to 340B Insight. Subscribe and rate us on Apple Podcasts, Google Play, Spotify, or wherever you listen to podcasts. For more information, visit our website at 340bpodcast.org. You can also follow us on Twitter @340BHealth and submit a question or idea to the show by emailing us at podcast@340bhealth.org.