Trends in 340B Drug Pricing Program Contract Growth Among Retail Pharmacies From 2009 to 2022

Nikpay, Sayeh; McGlave, Claire C; Bruno, John P.; Yang, Hee Jin; Watts, Elizabeth

doi:10.1001/jamahealthforum.2023.2139

Cited by 5 publications

(4 citation statements)

References 3 publications

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“…We used the name and address of the pharmacy as recorded by each 340B participant to link pharmacies in the database to the National Plan and Provider Enumeration System—the Centers for Medicare and Medicaid Services’ unique national provider identifier (NPI)—using text and geographic matching algorithms. 7 We then linked each pharmacy in the OPA database to retail pharmacies in the NCPDP data using the NPI. Retail pharmacy status was defined as having a primary provider type code in the NCPDP indicating retail and a secondary provider type that was not specialty or mail order.…”

Section: Methodsmentioning

confidence: 99%

“…We constructed 4 measures of participation in 340B contracts using the OPA database following studies in the literature. 6 , 7 These included an indicator for whether the pharmacy participated in any contract pharmacy arrangement (participation), a count variable equal to the number of contracts held by the pharmacy in each year (depth), the maximum geographic distance between each pharmacy and the 340B participants it contracts with (spread), and finally, an indicator for whether contract pharmacies have no contracts with core safety-net providers (safety-net composition). Safety-net providers are classified as federal grantees or hospitals that meet the Medicaid and CHIP (Children’s Health Insurance Program) Payment and Access Committee’s (MACPAC) definition of essential community hospitals.…”

Section: Methodsmentioning

confidence: 99%

“…In 2010, less than 1% of pharmacies participated in contract arrangements, expanding to over 40% by 2022. 6 , 7 Over time, retail pharmacies contracting with 340B participants were more likely to have multiple contracts with health care facilities that were less safety-net engaged and located farther away. 7 Most communities in the United States now contain at least 1 contract pharmacy, and several studies document that 340B participants, especially hospitals, establish contracts in areas with fewer uninsured and more wealthy patients.…”

Section: Introductionmentioning

confidence: 99%

“… 6 , 7 Over time, retail pharmacies contracting with 340B participants were more likely to have multiple contracts with health care facilities that were less safety-net engaged and located farther away. 7 Most communities in the United States now contain at least 1 contract pharmacy, and several studies document that 340B participants, especially hospitals, establish contracts in areas with fewer uninsured and more wealthy patients. 6 , 8 , 9 These results are consistent with participants seeking to maximize 340B revenue and are similar to growth patterns for 340B clinics.…”

Section: Introductionmentioning

confidence: 99%

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340B Contract pharmacy growth by pharmacy ownership: 2009–2022

McGlave,

Bruno,

Watts

et al. 2023

Health Affairs Scholar

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The 340B program grants eligible healthcare providers (“covered entities”) access to discounted prices for outpatient prescription drugs. Covered entities frequently rely on retail pharmacies (“contract pharmacies”) to dispense discounted drugs. This analysis describes contract pharmacy participation by ownership: the top four chains, grocery chains, small chains, and institutional independent pharmacies. We find that 71% of pharmacies in the top 4 chains were contract pharmacies, 41% of institutional pharmacies, 38% of grocery store pharmacies, and 22% of independent pharmacies participated in 340B in 2022. The median number of contracts per pharmacy was 2 among the top four chains and grocery store pharmacies, versus 1 for all other pharmacy types. The median farthest distance in miles from contracting covered entities was largest for the top-four chains (19 miles) and small chains (18 miles) and smallest for independent and institutional pharmacies (10 miles). The top four chains held the highest proportion of contracts with core safety-net providers (75%, compared to 61% of institutional pharmacies).

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Section: Methodsmentioning

confidence: 99%

Section: Methodsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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340B Contract pharmacy growth by pharmacy ownership: 2009–2022

McGlave,

Bruno,

Watts

et al. 2023

Health Affairs Scholar

Self Cite

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Trends in Proportion of Medicare Part D Claims Subject to 340B Discounts, 2013-2020

Dickson,

Gabriel,

Hernandez

2023

JAMA Health Forum

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ImportanceDespite controversy surrounding the 340B program, no study has analyzed trends in the proportion of Medicare Part D pharmacy claims eligible for 340B discounts.ObjectiveTo describe trends in the proportion of Medicare Part D claims that are prescribed by 340B-affiliated clinicians and filled in 340B pharmacies.Design and SettingThis longitudinal, retrospective cohort study included 2013 to 2020 claims data from a 5% random sample of Medicare Part D beneficiaries from the Centers for Medicare &amp; Medicaid Services and 6292 nine-digit national drug codes that were used by at least 1000 Part D beneficiaries in a given year. Data analysis was completed from November 2022 to April 2023.Main Outcomes and MeasuresFor each drug and year, there were 3 outcomes: (1) proportion of total Part D claims that were prescribed by a 340B-affiliated clinician; (2) proportion of claims prescribed by a 340B-affiliated clinician that were filled in a 340B pharmacy; and (3) proportion of total Part D claims under the 340B program (ie, prescribed by a 340B-affiliated clinician and filled in a 340B pharmacy).ResultsThe proportion of prescriptions written by a 340B-affiliated clinician doubled from 9.4% in 2013 to 19.3% in 2020. The capture of 340B prescriptions by 340B pharmacies, defined as the proportion of claims prescribed by 340B-affiliated clinicians that were filled by 340B pharmacies, increased from 18.4% in 2013 to 49.9% in 2020. As a result, the total proportion of 340B claims in Part D increased from 1.7% in 2013 to 9.6% in 2020. Rates of 340B prescribing and capture increased consistently across therapeutic classes. In 2020, the antiviral therapeutic class was the class with the largest proportion of 340B claims (16.1%), followed by targeted antineoplastics (15.7%).Conclusions and RelevanceThis cohort study demonstrated that from 2013 to 2020, the share of Medicare Part D claims prescribed by a 340B-affiliated clinician increased; however, the rate at which 340B-eligible prescriptions were filled at 340B pharmacies increased at a faster rate, driving the overall increase in 340B claims. Despite these trends, only half of 340B-eligible prescriptions were subject to the 340B discount in 2020.

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Growing administrative complexity in the 340B program and the rise of third-party administrators

Nikpay,

Halvorson

2023

Health Affairs Scholar

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The 1992 340B drug discount program lowers drug costs and provides a source of revenue for safety-net providers by entitling them to discounts on drugs for all patients, including those with insurance. As 340B has grown so has the administrative complexity of the program, creating a market for third-party administrators (TPAs) to manage both formal and informal requirements in exchange for fees. Although TPAs are playing an important role in the 340B ecosystem, the TPA market is poorly understood, along several dimensions including its size, specialization, competitiveness, and scope of services offered. In this brief report, we report the results of original market research on TPA firms to address unanswered questions and identify gaps in knowledge. We identify 48 TPA firms, including 8 owned by private equity firms, 2 owned by software companies, and 6 owned by a variety of vertically integrated health care stakeholders such as pharmacies, pharmaceutical benefit managers, and pharmaceutical wholesalers. We identified 7 services offered by TPAs including patient discount cards (13), enrollment (31), auditing (45), revenue capture (42), referral management (9), inventory management (19), and 340B ESP assistance (9). Our results suggest that TPAs are involved in many diverse functions related to 340B.

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Trends in 340B Drug Pricing Program Contract Growth Among Retail Pharmacies From 2009 to 2022

Abstract: This cross-sectional study assesses the increases and decreases over time in the number of pharmacy contracts, distance from contracting pharmacies, and proportion of pharmacy contracts with safety-net practices in the US.

Cited by 5 publications

References 3 publications

340B Contract pharmacy growth by pharmacy ownership: 2009–2022

340B Contract pharmacy growth by pharmacy ownership: 2009–2022

Trends in Proportion of Medicare Part D Claims Subject to 340B Discounts, 2013-2020

Growing administrative complexity in the 340B program and the rise of third-party administrators

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