FQHC Updates from the Summer Coalition Conference

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FQHC Updates from the Summer Coalition Conference

It is hard to believe that summer is almost over. The threat of fall is already in the air here in Maine and I am missing that sweltering D.C. heat we enjoyed at the Summer Coalition conference. The conference was highlighted by the positive message that at least for the time, the 340B environment in Washington is not as overtly hostile as it previously was and that politicians have shifted their focus to areas like the upcoming presidential election and other more pressing social issues. We learned that the 340B battles are moving to the state legislature. Here there have been some positive developments, as was the case in West Virginia, where a PBM reform bill was passed protecting 340B pharmacies from discriminatory pricing, and some less than positive developments in states like California.

One big area of change noted at the conference was for the FQHC’s where changes have been made to the 340B review process and sliding fee scale expectations have been clarified to some extent.

In 2015, the Bureau of Primary health Care (BPHC) added questions about 340B to the official operational site visit (OSV) protocol. The questions involved demonstrating that appropriate 340B policies and procedures, contracts and program oversite were in place. If areas of concern were noted when reviewing these screening questions, covered entities had the potential to receive a formal HRSA audit. Earlier this year, BPHC officially removed the 340B questions from the OSV protocol. This was likely due to variation and limited 340B expertise among auditors.

While the 340B screening questions have been removed from the OSV, two areas of 340B focus were highlighted at the Summer Coalition conference. One is that the OSV auditors are asking the FQHC staff if they are completing their annual 340B external audits. The second is that there are now formalized expectations being vocalized for pharmacy services sliding fee scales.

The 340B program has no requirements regarding how much patients should be charged for 340B drugs.  HRSA’s sliding fee scale rule for pharmacy applies only to the service fee and not to the medication charge itself. HRSA does not require that the ingredient cost be subject to a sliding fee scale (SFS), but FQHC’s can choose to apply further discounts beyond that of the service fee. The pharmacy SFS can be structured differently from the other SFS’s offered by the health center. Based on BPCH’s standard sliding fee rules, the dispensing (service) fee should be no more than a nominal fee for those below 100% of the federal poverty limit (FPL), have at least three slide levels between 101% and 200%, and have no discount above 200% of FPL. The expectation has been expressed that the SFS’s are offered at both the FQHC’s in-house and contract pharmacies.

The application of the pharmacy sliding fee scale levels should correspond with those of the health centers medical sliding fee scale and they should use a shared enrollment process. For contract pharmacies, the TPA’s may be able to assist in developing the mechanisms to allow for patients to access sliding fee scale prices on their 340B prescriptions. If a TPA is not able to provide a solution, external pharmacy benefits managers may be able to assist in setting up the contract pharmacy sliding fee scale program. Failure to apply sliding fee scales at in-house and contract pharmacies could result in area for improvement findings during OSV reviews.

We are always happy to help if you have questions about sliding fee scales or anything else!

Sample Sliding Fee Scales

FPL Level Dispensing (Service) Fee Model Flat Fee Model
greater than
No discount No discount
199-150% $12 + Cost of Medication $20
149-101% $8 + Cost of Medication $10
100-1% $3 + Cost of Medication $5
No Income $0 + Cost of Medication or No Charge No Charge

About Author

Felicity Homsted, PharmD, MBA

Lead pharmacist auditor, provides support for onsite audits. Felicity served as Chief Pharmacy Officer at a Federally Qualified Health Center from 2012-2018, responsible for four retail pharmacies, integrated clinical pharmacy services, three pharmacy residency programs and 340B program management. Felicity was also Chief Pharmacy Officer for Community Care Partnership of Maine, an accountable care organization comprised of 11 different health systems, where she supported pharmacy operations and 340B compliance for all member organizations. Felicity represented her entity as a HRSA 340B leading practice peer to peer site during 2013 to 2015. Felicity served as a subject matter expert for the Apexus 340B Prime Vendor program, speaking as faculty at 340B University on contract and in-house pharmacy operations, authoring the contract pharmacy modules for the 340B ACE Operations Certificate. She has presented on 340B program operations and compliance at 340B Coalition, National Association of Community Health Centers, and American Pharmacy Association meetings.

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