Bass, Berry & Sims attorney Jeff Davis was recently featured in Specialty Pharmacy Continuum discussing the operational, financial, and legal implications of the Health Resources and Services Administration’s (HRSA) revised 340B rebate pilot program, which is currently scheduled to take effect January 1, 2027. The pilot program would require covered entities to purchase certain high-cost drugs at wholesale acquisition cost and recover 340B discounts through manufacturer-paid rebates rather than receiving discounts upfront.
In the article, Jeff notes that healthcare providers are already evaluating how to prepare for the significant operational changes the pilot program could require. “Providers are taking steps to make sure that they would be ready operationally, and that’s a huge lift in terms of putting new systems in place,” he said. Jeff explained that covered entities may need new processes and technology to identify eligible claims, submit pharmacy and medical claims data, track rebate payments, and reconcile those payments against drug purchases.
Jeff also highlighted ongoing concerns regarding the financial impact of the proposed rebate model. While manufacturers would generally have 10 days to pay a rebate after receiving a complete claim submission, he cautioned that hospitals may experience much longer delays between purchasing a drug and receiving reimbursement. “The reality is that providers may buy a drug and then it sits on the shelf for 30 days before it gets dispensed, and then it could take time to gather data before they can submit the rebate request,” he said. “By the time they actually get paid the rebate, it could be well over a month since when they initially purchased the drug.”
The article also explores the potential for additional legal and legislative challenges to the pilot. According to Jeff, many covered entities continue to raise the same concerns that were voiced in response to HRSA’s earlier rebate proposal, including operational burdens and cash-flow disruptions. However, he cautioned providers against assuming that courts or Congress will halt implementation before the scheduled launch date. “If either of those challenges does not happen, then this pilot will go into effect Jan. 1,” Jeff said, emphasizing the importance of preparing now despite ongoing uncertainty.
Read the full article,“340B Rebate Pilot: What Hospitals Need to Do Now Before Possible 2027 Launch,” in Specialty Pharmacy Continuum that was published on August 13. Sister publication Pharmacy Practice News republished the content on August 14.