Routine audits of 340B billing practices could yield new revenues for health systems that rely on funding from the program, while also revealing new opportunities to improve patient care.
“Some low-hanging fruit is to look at your waste,” said Samuel Lewis, PharmD, MS, 340B ACE, the pharmacy business manager for Eskenazi Health, in Indianapolis. “If you administer a drug but don’t administer the whole vial, your system may not get a whole 340B accumulation for that,” said Dr. Lewis, who noted that Eskenazi is heavily reliant on 340B funding.
“Our institution was ordering 30-mg vials of ketorolac, but a lot of times we were only using 15 mg out of that vial. So, the rest was wasted,” Dr. Lewis recalled at the ASHP Midyear 2024 Clinical Meeting & Exhibition, in New Orleans. Eskenazi’s policy is to only bill insurers for what is used rather than what was ordered. Even if the ketorolac purchase costs were lower due to a 340B discount, the health system’s reimbursement return was lower than it could have been because Eskenazi does not bill for the wasted vials.
This reality became clear during a routine 340B audit that Dr. Lewis led. However, there was a straightforward solution.
“Fifteen-milligram vials of ketorolac are also available, so we started to order those,” Dr. Lewis said. Besides now being able to reimburse for a complete vial, Dr. Lewis said that for most patients, the lower dose yields the same benefits as 30 mg but with fewer side effects. This is why 15 mg was the usual dose in the first place—the audit helped align purchasing with clinical practice.
The ketorolac case benefitted the bottom line while also improving patient care. Sometimes, however, a provider will prescribe a higher-cost medication for valid clinical reasons that negatively impacts Eskenazi’s medication budget. In addition, Dr. Lewis noted, Eskenazi loses money on many medications because as a safety net hospital, it covers costs for patients who can’t afford them.
To shore up the budget and leverage available 340B discounts on medications, Dr. Lewis suggested stepping up from lower-cost therapies instead of going straight to the more expensive option. “The third-party administrators that [monitor] 340B compliance for institutions are really growing in their ability to generate reports and suggest cost savings.”
This article is from the March 2025 print issue.