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340B Tip Number 3: Don’t Fear a HRSA Audit of your 340B Program

Posted in: 340B Tip of the Week, Murer Expert Advice Started by

340B Tip Number 3: Don’t Fear a HRSA Audit of your 340B Program

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Murer Consultants Expert Advice: 340B Tip of the Week

Each week Murer Consultants will provide go-to expert quick tips to keep your facility 340B compliant and your 340B savings optimized.

The healthcare industry is anything but stagnant. Rapid change is upon us. As a healthcare professional, you know that it’s critical to keep programs like 340B flexible, agile and braced for the changes ahead. Maintaining current compliance and effective operations is Job #1.

With this in mind, Murer Consultants is compiling its top tips to assist covered entities in optimizing their 340B programs. We want our clients and friends not just to survive in the event of a HRSA or manufacturer audit, but to thrive and continue to strive.

Tip #3: Don’t fear a HRSA Audit of your 340B Program. Understand the Process in Advance of Notification and Plan Ahead.

Over the past five years, the number of HRSA audits has steadily increased as the government has demonstrated a willingness to provide additonal oversight over the 340B Program. To date, nearly 200 finalized audits from 2016 have been posted, and more audits remain under review. Results are posted each month as additional reports are published. HRSA has issued findings against almost 2/3 of those audited, with repayment to manufacturers being the most common corrective action.

With an increase in HRSA audits, your entity will likely be reviewed. By taking the necessary steps now, any provider can greatly reduce the risk of a negative finding.

Murer understands the audit process and its goals.

HRSA audits entail:

  • A thorough review of policies, procedures and the entire drug distribution system;
  • Review of the entity’s eligibility status, including compliance with Group Purchasing Organization prohibitions for certain entity types;
  • Examination of drug procurement and distribution to determine whether the entity provided 340B drugs to appropriate patients; and
  • A review to determine whether the entity properly prevented duplicate discounts.

To eliminate stress and decrease your entity’s risk for error, Murer recommends planning ahead: understanding the audit process and preparing before you receive your audit notice from HRSA is crucial to successfully navigating the audit process.

A HRSA audit begins with written notice from HRSA sent to the Covered Entity’s Authorizing Official The name of the assigned auditor and a general explanation of the process is provided. The notification includes a data request, as well as a one-page logistics request. Entities have three days to respond to the notification.

HRSA auditors then schedule an introductory call shortly after sending the written notice to review the audit process and answer any questions regarding the data request. Following the call, the audited entity will typically have two-to-three-weeks to complete the data request. The information and documentation requested includes:

  • Policies and procedures, including assurance that the 340B database is up-to-date, a description of your procurement process, and more;
  • Most recently filed (and applicable) Medicare cost report and trial balance documentation;
  • 340B Drug Orders and Prescriptions (including both in-house and contract pharmacies);
  • Proof of employment, contract, and/or credentialing for providers; and
  • Certain drug procurement information, including a full list of wholesalers, a listing of all accounts used to purchase drugs, purchase order reports for all 340B accounts, and a listing of all Medicaid billing numbers.
  • Any follow up information and documentation that the auditor requests after the data request submission.

For the actual audit itself, auditors typically spend one full day onsite for entities with in-house pharmacy programs and an additional ½-to-1 full day at entities with contract pharmacy programs. Post-audit, providers wait 8-12 weeks before receiving a preliminary finding report from HRSA.

Preparing in advance with Murer for your eventual audit calms nerves and relieves stress. Murer can help an entity ensure successful audit preparation by working with the entity to create robust 340B policies and procedures, providing necessary 340B training to entity staff, and developing strategies that increase compliance rates.

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