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Really good coverage that I can’t find anyone/anywhere else discussing.
Gift article link here:
www.nytimes.com
“Twenty years ago, the federal government chose Apexus to manage what was then a small program, negotiating with drug distributors and manufacturers to secure better prices and access to medications. But Apexus is allowed to collect a fee for almost every drug sold under the program, giving the company an incentive to help hospitals and clinics capture as many prescriptions as possible.
- Its “purchasing optimization team” shows hospitals how they can make more money by buying different drugs.
- A certification program and an Apexus-run “university” trains providers in boosting earnings.
- Apexus employees give advice that broadly interprets the rules of the program so hospitals can claim additional patients and drugs.
The Health Resources and Services Administration, an agency within H.H.S. that oversees the program, declined to answer detailed questions from The Times. But in a statement, a spokeswoman said the agency “conducts rigorous oversight of all contracts,” and “to our knowledge, Apexus has not violated” its contract.
Established in 1992, the 340B program essentially requires pharmaceutical manufacturers to offer discounts on outpatient drugs to hospitals and clinics that treat a greater share of low-income and uninsured patients.
The hospitals then can charge insurers and patients the standard price and keep the profits. Although the money is supposed to encourage care for impoverished patients, there are few rules to enforce that.
Patients rarely know they are part of this system. Their prescriptions can be counted as 340B when they get outpatient treatment at a hospital or clinic that qualifies for the program, regardless of the patients’ own income or insurance status. The provider can continue to make money off the patients’ future outpatient prescriptions, even if they get them somewhere else.
Apexus has had contracts to handle the program since the early 2000s. The government does not pay Apexus — instead, drugmakers and distributors pay the company a small percentage of sales.
Based in Irving, Texas, it is a subsidiary of Vizient, a private business owned by hospitals that negotiates a range of health care discounts. Apexus was established as a small nonprofit in 2007 but became a for-profit company in 2014.
Around the same time, 340B began to explode for a number of reasons. More hospitals qualified for the program after the Affordable Care Act expanded the number of people on Medicaid. Other health care systems qualified after acquiring hospitals and clinics in poor areas. Some, already eligible for 340B, bought up practices that used high-margin drugs, like oncology clinics. And a government rule change meant hospitals could make money from prescriptions filled at a greater number of pharmacies.
the rules governing the program are ambiguous, and Apexus offers broad interpretations. Apexus has advised hospitals that they can mine records as far back as 36 months for eligible patients they may have missed. Apexus employees have shown hospitals how to maximize the number of pharmacies they work with, boosting the number of prescriptions that can qualify for discounts. About eight years ago, Apexus began selling a $750 course for people to become “certified experts” in 340B. It started a business to give hospitals better access to specialty drugs — for conditions like cancer, H.I.V. and autoimmune diseases — which are major drivers of 340B’s growth. That company, Acentrus, helped hospitals and clinics provide data to manufacturers in exchange for deeper discounts and access to those drugs. The company charges 3 percent in fees for a line of generic drugs that are managed and provided by drug distributors, according to former employees. Apexus simply provides access to the health systems. For the last decade, Apexus has earned millions of dollars on drug purchases made outside the 340B program: Because not all outpatient drugs qualify for 340B discounts, hospitals must stock their pharmacies with medication purchased through different channels. Apexus acts as a middleman, making fees off those transactions. In its statement, Apexus said its federal contract did not preclude it from developing other businesses, as long as they were not in conflict with the terms of the agreement. Regulators were aware of these ventures, the company said, noting that its specialty drug business, Acentrus, was in “no way associated with” the 340B program.”
Gift article link here:
How a Company Makes Millions Off a Hospital Program Meant to Help the Poor
A private business has helped supercharge a controversial federal drug program. Patients and insurers have been left with big bills.
“Twenty years ago, the federal government chose Apexus to manage what was then a small program, negotiating with drug distributors and manufacturers to secure better prices and access to medications. But Apexus is allowed to collect a fee for almost every drug sold under the program, giving the company an incentive to help hospitals and clinics capture as many prescriptions as possible.
- Its “purchasing optimization team” shows hospitals how they can make more money by buying different drugs.
- A certification program and an Apexus-run “university” trains providers in boosting earnings.
- Apexus employees give advice that broadly interprets the rules of the program so hospitals can claim additional patients and drugs.
The Health Resources and Services Administration, an agency within H.H.S. that oversees the program, declined to answer detailed questions from The Times. But in a statement, a spokeswoman said the agency “conducts rigorous oversight of all contracts,” and “to our knowledge, Apexus has not violated” its contract.
Established in 1992, the 340B program essentially requires pharmaceutical manufacturers to offer discounts on outpatient drugs to hospitals and clinics that treat a greater share of low-income and uninsured patients.
The hospitals then can charge insurers and patients the standard price and keep the profits. Although the money is supposed to encourage care for impoverished patients, there are few rules to enforce that.
Patients rarely know they are part of this system. Their prescriptions can be counted as 340B when they get outpatient treatment at a hospital or clinic that qualifies for the program, regardless of the patients’ own income or insurance status. The provider can continue to make money off the patients’ future outpatient prescriptions, even if they get them somewhere else.
Apexus has had contracts to handle the program since the early 2000s. The government does not pay Apexus — instead, drugmakers and distributors pay the company a small percentage of sales.
Based in Irving, Texas, it is a subsidiary of Vizient, a private business owned by hospitals that negotiates a range of health care discounts. Apexus was established as a small nonprofit in 2007 but became a for-profit company in 2014.
Around the same time, 340B began to explode for a number of reasons. More hospitals qualified for the program after the Affordable Care Act expanded the number of people on Medicaid. Other health care systems qualified after acquiring hospitals and clinics in poor areas. Some, already eligible for 340B, bought up practices that used high-margin drugs, like oncology clinics. And a government rule change meant hospitals could make money from prescriptions filled at a greater number of pharmacies.
the rules governing the program are ambiguous, and Apexus offers broad interpretations. Apexus has advised hospitals that they can mine records as far back as 36 months for eligible patients they may have missed. Apexus employees have shown hospitals how to maximize the number of pharmacies they work with, boosting the number of prescriptions that can qualify for discounts. About eight years ago, Apexus began selling a $750 course for people to become “certified experts” in 340B. It started a business to give hospitals better access to specialty drugs — for conditions like cancer, H.I.V. and autoimmune diseases — which are major drivers of 340B’s growth. That company, Acentrus, helped hospitals and clinics provide data to manufacturers in exchange for deeper discounts and access to those drugs. The company charges 3 percent in fees for a line of generic drugs that are managed and provided by drug distributors, according to former employees. Apexus simply provides access to the health systems. For the last decade, Apexus has earned millions of dollars on drug purchases made outside the 340B program: Because not all outpatient drugs qualify for 340B discounts, hospitals must stock their pharmacies with medication purchased through different channels. Apexus acts as a middleman, making fees off those transactions. In its statement, Apexus said its federal contract did not preclude it from developing other businesses, as long as they were not in conflict with the terms of the agreement. Regulators were aware of these ventures, the company said, noting that its specialty drug business, Acentrus, was in “no way associated with” the 340B program.”
