EOHHS Proposed Rx Rule Raises Concern

The Executive Office of Health & Human Services has issued draft regulations governing pharmacy services delivered to MassHealth patients. While the regulations contain some interesting cost-saving proposals relating to 90-day versus 30-day supplies of drugs and rules relating to cash payments, one proposal relating to drugs purchased under the 340B program is raising concern among hospitals.
The federal government created the 340B program to provide drug discounts to hospitals and clinics serving low-income patients, including pediatric, disproportionate share, and critical access hospitals. Under the 340B program, manufacturers of prescription drugs are required to offer 340B hospitals and clinics outpatient drugs at or below a set ceiling price as a condition of having these drugs covered through Medicaid. 
Under the proposed rules MassHealth would have new authority to designate and exclude from MassHealth coverage certain high-cost drugs that are purchased under the 340B program. MHA is concerned with the proposal as it would establish an unclear process for determining which drugs would be excluded, as well as have the ultimate effect of restricting a federal benefit intended to support qualified hospitals.
“The 340B program is a federal benefit afforded to qualified providers in recognition of their limited funding available to serve low-income patients,” said MHA’s Senior Director of State Government Finance and Policy Dan McHale. “The notion of putting conditions on MassHealth covered drugs in connection to this federal benefit raises significant alarm. These hospitals depend highly on the 340B financing to support the care they provide to MassHealth patients. It will be critical that any efforts to achieve pharmaceutical cost savings within the MassHealth program not negatively affect healthcare providers.”