{"id":4464,"date":"2017-07-25T00:05:00","date_gmt":"2017-07-25T00:05:00","guid":{"rendered":"https:\/\/www.healthlawpolicymatters.com\/?p=4464"},"modified":"2021-11-03T00:07:12","modified_gmt":"2021-11-03T00:07:12","slug":"witnesses-congressional-hearing-340b-urge-congress-give-hrsa-broader-regulatory-authority","status":"publish","type":"post","link":"https:\/\/www.healthlawpolicymatters.com\/2017\/07\/25\/witnesses-congressional-hearing-340b-urge-congress-give-hrsa-broader-regulatory-authority\/","title":{"rendered":"Witnesses at Congressional Hearing on 340B Urge Congress To Give HRSA Broader Regulatory Authority"},"content":{"rendered":"\n

On July 18, 2017, just days after CMS went public with its\u00a0proposal<\/a>\u00a0to reduce Medicare Part B reimbursement to certain 340B covered entities, Congress held its first hearing on\u00a0340B Program Oversight<\/a>\u00a0since March 2015.\u00a0 A common thread ran through the testimony of the three testifying witnesses:\u00a0\u00a0Erin Bliss<\/a>, Assistant Inspector General with HHS-OIG;\u00a0Dr. Debra Draper<\/a>, Director of Health Care at the GAO; and,\u00a0Captain Krista Pedley<\/a>, Director of the Office of Pharmacy Affairs at HRSA:\u00a0 Congress needs to legislatively grant HRSA more administrative authority over the 340B Drug Discount Program.\u00a0<\/p>\n\n\n\n

Captain Pedley, Dr. Draper, and a prior HHS-OIG official testified before this same Committee at a\u00a0March 2015 hearing<\/a>.\u00a0 During that hearing, HHS-OIG and the GAO expressed concerns about the explosive growth in the 340B Program as well as HRSA\u2019s oversight efforts, but made no unified endorsement of Congressional action. \u00a0What changed?<\/p>\n\n\n\n

I have\u00a0written<\/a>,\u00a0ad nauseum,\u00a0<\/em>about the\u00a0impact<\/a>\u00a0of the October 2015\u00a0federal court ruling<\/a>\u00a0invalidating regulations interpreting the statutory orphan drug exception to 340B.\u00a0 The court found that because the 340B statute was unambiguous, HRSA lacked authority to engage in rulemaking in areas unauthorized by Congress.\u00a0 In\u00a0my opinion<\/a>, the orphan drug ruling was directly responsible for HRSA\u2019s withdrawal of its \u201c340B Mega-Reg\u201d which would have set parameters for 340B Program compliance, as well as HRSA\u2019s withdrawal of similar \u201c340B Omnibus Guidance\u201d in early 2017.<\/p>\n\n\n\n

Validation did come during the June 18th hearing.  Specifically, Captain Pedley testified that HSRA had undertaken rulemaking in all areas in which the 2015 federal court ruling found that it had specific delegated authority under the 340B statute. Captain Pedley went on to note, however, that:<\/p>\n\n\n\n

Specific legislative authority to conduct rulemaking for all provisions in the 340B statute would be more effective for facilitating HRSA\u2019s oversight over, and management of, the 340B Program.  In addition, [a Congressional grant of] specific regulatory authority would allow HRSA to provide greater clarity and specificity to Program requirements. <\/em><\/p><\/blockquote>\n\n\n\n

Dr. Draper used her testimony to address the following four recommendations that the\u00a0GAO first made to HRSA in 2011<\/a>\u00a0and that she later referenced in her 2015 testimony:<\/p>\n\n\n\n

  1. increase HRSA auditing for compliance;<\/li>
  2. update 340B guidance for manufacturers;<\/li>
  3. provide more specificity and clarity in the standards for 340B hospital eligibility; and<\/li>
  4. provide more specificity and clarity in the definition of a 340B patient.<\/li><\/ol>\n\n\n\n

    Dr. Draper acknowledged that HRSA had acted on the first two recommendations, but that it had pulled back on its efforts to act on the latter two in the wake of the 2015 ruling. \u00a0Dr. Draper also raised\u00a0the differing interpretations of the intent of the 340B Program<\/a>, questioning whether the program\u2019s purpose is, in part, to require\u00a0covered entities and contract pharmacies to provide uninsured patients with access to 340B drugs.<\/p>\n\n\n\n

    Ms. Bliss reiterated HHS-OIG\u2019s concerns about the lack of clarity in the rules governing the 340B Program.  She also repeated a point that HHS-OIG made in the 2015 hearing: the lack of state Medicaid program access to information about 340B pricing hinders states from ensuring that Medicaid Programs are not paying more than the ceiling price for 340B drugs provided to Medicaid beneficiaries.  Ms. Bliss supported congressional action to provide HRSA the necessary authority to clarify program rules, but stated that Congress also needed to authorize HRSA to share ceiling prices with state Medicaid Programs.  Ms. Bliss did comment, however, that in areas where HRSA already had authority, action had been slow. She specifically questioned HRSA\u2019s efforts to implement a long-promised database for sharing 340B ceiling prices with covered entities, as well as the agency\u2019s efforts to update the processes to screen for duplicate discounts in Medicaid and Medicaid managed care.<\/p>\n\n\n\n

    Most of the Committee\u2019s questions were directed at Captain Pedley.<\/p>\n\n\n\n