[Federal Register Volume 60, Number 211 (Wednesday, November 1, 1995)]
[Notices]
[Pages 55586-55587]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-27032]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Public Health Service
Notice Regarding Section 602 of the Veterans Health Care Act of
1992 Contracted Pharmacy Services
AGENCY: Public Health Service, HHS.
ACTION: Notice.
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SUMMARY: Section 602 of Public Law 102-585, the ``Veterans Health Care
Act of 1992'' (the ``Act''), enacted section 340B of the Public Health
Service Act (``PHS Act''), ``Limitation on Prices of Drugs Purchased by
Covered Entities.'' Section 340B provides that a manufacturer who sells
covered outpatient drugs to eligible (covered) entities must sign a
pharmaceutical pricing agreement with the Secretary of Health and Human
Services (HHS) in which the manufacturer agrees to charge a price for
covered outpatient drugs that will not exceed an amount determined
under a statutory formula.
The purpose of this notice is to inform interested parties of the
following proposed guidelines regarding contracted pharmacy services.
Public comment is invited.
DATES: The public is invited to submit comments on the proposed
guidelines by December 1, 1995. After consideration of the comments
submitted, the Secretary will issue the final guidelines.
FOR FURTHER INFORMATION CONTACT: Marsha Alvarez, R. Ph., Director, Drug
Pricing Program, Bureau of Primary Health Care, 4350 East-West Highway,
Bethesda, MD 20814, Phone (301) 594-4353, FAX (301) 594-4982.
SUPPLEMENTARY INFORMATION: The Health Resources and Services
Administration, Bureau of Primary Health Care, acting through the
Office of Drug Pricing, has developed contracted pharmacy service
guidelines to facilitate
[[Page 55587]]
program implementation. For covered entities that wish to utilize
contracted pharmacy services to dispense section 340B outpatient drugs,
the Office of Drug Pricing is proposing a contracted pharmacy service
agreement between the covered entity and the pharmacy which would
include the following provisions:
(a) The covered entity will purchase the drug. A ``ship to-bill
to'' procedure may be used in which the covered entity purchases the
drug, the manufacturer bills the covered entity for the drugs that it
purchased but ships the drugs directly to the contracted pharmacy.
(b) The contractor will provide all pharmacy services (e.g.,
dispensing, record keeping, drug utilization review, formulary
maintenance, patient profile, counseling). Each facility which
purchases its covered outpatient drugs has the option of individually
contracting for pharmacy services with the pharmacy of its choice. The
limitation of one pharmacy contractor per facility does not preclude
the selection of a pharmacy contractor with multiple pharmacy sites, as
long as only one site is used for the contracted services. [The Office
of Drug Pricing will be evaluating the feasibility of permitting these
facilities to contract with more than one site and contractor.]
(c) If the patient does not elect to use the contracted service,
the patient may obtain the prescription from the pharmacy provider of
his/her choice.
(d) The contractor may provide the covered entity services, other
than pharmacy, at the option of the covered entity (e.g., home care,
reimbursement services).
(e) The contractor and the covered entity will adhere to all
Federal, State, and local laws and requirements. Additionally, all PHS
grantees will adhere to all rules and regulations established by the
grant funding office.
(f) The contractor will provide the covered entity quarterly
financial statements, a detailed status report of collections, and a
summary of receiving and dispensing records.
(g) The contractor will establish and maintain a tracking system
suitable to prevent diversion of section 340B discounted drugs to
individuals who are not patients of the covered entity.
(h) Both parties agree that they will not resell or transfer a drug
purchased at section 340B pricing to an individual who is not a patient
of the covered entity. See section 340B(a)(5)(B). If a contract
pharmacy is found to have violated this prohibition, the pharmacy will
pay the entity the amount of the discount in question so that the
entity can reimburse the manufacturer.
(i) A covered entity using contracted pharmacy services will not
use drugs purchased under section 340B to dispense Medicaid
prescriptions unless the contract pharmacy and the state medicaid
agency have established an arrangement which will prevent duplicate
discounts/rebates.
(j) Both parties understand that they are subject to audits (by the
PHS and participating manufacturers) of records that directly pertain
to the entity's compliance with the drug resale or transfer prohibition
and the prohibition against duplicate Medicaid rebates and PHS
discounts. See section 340B(a)(5).
(k) Upon request, a copy of this contracted pharmacy service
agreement will be provided to a participating manufacturer which sells
covered outpatient drugs to the covered entity. All confidential
propriety information may be deleted from the document.
Covered entities which elect to utilize this contracted pharmacy
mechanism must submit to the Office of Drug Pricing a certification
that they have signed an agreement with the contracted pharmacy
containing the aforementioned provisions.
Dated: August 18, 1995.
Ciro V. Sumaya,
Administrator, Health Resources and Services Administration.
[FR Doc. 95-27032 Filed 10-31-95; 8:45 am]
BILLING CODE 4160-15-P
