340b program policy and procedure self-audit tool

340B Program Policy and Procedure Self-Audit Tool

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Purpose: The purpose of this tool is to identify and evaluate the topics within a covered entity’s 340B Program policy and procedure documents.

HRSA has identified a list of seventeen specific areas to assist covered entities in developing the necessary specificity for their 340B-related policies and procedures. These policies and procedures help covered entities mitigate their risk of non-compliance. These policies and procedures are requested as part of the HRSA audit data request, which takes place before the HRSA regional auditor arrives onsite. These site-specific policies and procedures should reflect actual practice and, therefore, be continually monitored, evaluated and modified to reflect both the needs and work of the organization.

Policies and procedures provide guidelines for decisions and actions within a 340B covered entity by promoting compliance with the 340B statute, guidance, and policy requirements while also standardizing practices throughout the organization. Policies and procedures provide clarity both internally and externally regarding how the covered entity operates a compliant 340B Program. Policies and procedures should include elements of program requirements, including methodologies for routine self-auditing and internal corrective action. Covered entities are strongly encouraged to review and update their policies and procedures for all facets of the 340B Program on a regular basis in order to improve program integrity within their organization.

Instructions: Covered entities are encouraged to complete this self-audit tool at least annually and upon issuance of updated guidance by HRSA.

Step 1: Complete lines (1) through (7) on page (2): 340B Program Policy and Procedure Review.

Step 2: Review the entity’s 340B Program policies and procedures.

Step 3 Answer the assessment questions on pages (3) through (8).Evaluate policies and procedures and ensure that the key topics are addressed.Document the entity’s specific policy and procedure number and pages containing key topics. Document the most recent date the policy and procedure was reviewed/updated/approved.

Step 4: Document a summary of results on line (8) of page (2). Provide a high level overview of the self-audit results. Note areas of strength and/or areas for improvement identified.

Step 5: Share the summary of results with the 340B Steering Committee (or other compliance oversight body as determined by entity’s Compliance Program).

Step 6: Develop a corrective action plan, if applicable. Attach corrective action plan to this Policy and Procedure Self-Audit Tool.Attach completed corrective action plan, with completion date, when finished.



340B Program Policy and Procedure Review1. Document the parent 340B ID2. Document the parent covered entity name3. Document the parent physical address4. Document the date of the LAST policy and procedure self-audit5. Document the completion date of THIS policy and procedure self-

audit6. Document name and title of the individual completing this self-audit

7. Signature of reviewer

8. Summary of results:

9. Actions to be taken:



Compliance Element: Covered entity has comprehensive, written 340B Program policies and procedures.

Policies and procedures provide guidelines for decisions and actions within an organization by promoting compliance with regulations, statutes, and guidelines while also standardizing practices throughout the organization.

Assessment Question Yes No N/A Unsure

1) Do the hospital/grantee’s policies and procedures describe its registration/recertification process?

Document name of the policy and procedure.

Document the section or page number that includes the following elements:

i. Process for ensuring that the 340B database is up-to-date and accurate for parent and applicable off-site outpatient facilities

ii. Process for ensuring that the 340B database is up-to-date and accurate for contract pharmacies

iii. Processes includes frequency of regular reviews, how review is documented, and the timely update of 340B database records

Date last reviewed/updated/approved:

If response “No”, “N/A” or “Unsure” explain:


3) Do the hospital/grantee’s policies and procedures describe its process for determining eligible sites?

Document name of policy and procedure.

Document the section or page number that includes the following element to address how eligibility of each service site that uses 340B drugs is determine:

i. Within the four walls of parent entity; (for hospitals)ii. Listed as reimbursable on entity’s MCR (for hospitals)iii. Approved service sites on the grant (for grantees)iv. Registered on the 340B database (hospitals and grantees)






5) Do the hospital/grantee’s policies and procedures describe its procurement process?


Document the section or page number that includes the following element:

i. Identification of all accounts used for purchasing medications at the parent site

ii. Identification of all accounts used for purchasing medications at the off-site locations (if applicable)

iii. Identification of all accounts used for purchasing medications at the contract pharmacy(ies) (if applicable)




8) Do the hospital’s policies and procedures describe its process for prevention of GPO violations? (Applies to Disproportionate Share Hospitals (DSH), children’s hospitals (PED) , and free-standing cancer hospitals (CAN)



i. Definition of covered outpatient drugsii. Process for handling self-negotiated contracts for individual entities

and integrated delivery networks




9) Do the hospital/grantee’s policies and procedures define any exclusions to the definition of covered outpatient drugs (i.e. bundled drugs or inpatient drugs) if applicable?



i. Exclusion list of covered outpatient drugs






10) Do the hospital/grantee’s policies and procedures describe its process for conducting oversight of its contract pharmacy(ies) operations? *



i. Process used for internal auditsii. Process used for independent auditiii. Processes include methodology and frequency




11) Do the hospital/grantee’s policies and procedures describe its process to track and account for all 340B drugs in a physical inventory?



i. Inventory process is outlined from the receipt of the medication to the dispensation/ administration of the medication

ii. Routine inventory Countsiii. Reconcile inventory counts with inventory systemiv. Adjusting and reconciling variances (including documentation

of outcome)




12) Do the hospital/grantee’s policies and procedures describe its process to track and account for all 340B drugs via accumulation; in a virtual replenishment model?

Document name of the policy and procedure:

Document the section or page number that includes the following element

i. Inventory process is outlined from the receipt of the medication to the dispensation/ administration of the medication



ii. Accumulator software settings criteriaiii. Reconciliation to beginning inventory, receiving and dispensations to

identify variancesiv. Accumulator manual adjustment criteria (i.e. unused medication,

return-to-stocks, outdated drug destruction)v. Replenishment with an 11-digit to 11-digit NDC number




13) Do the hospital/grantee’s policies and procedures describe its process for handling the situation where the hospital/grantee does NOT use an 11-digit to 11-digit NDC match process?


Document the section or page number that includes the following element;

i. Use of Charge Description Master (CDM) to National Drug Code (NDC) crosswalk

ii. Maintaining auditable records to demonstrate proper accumulation in a replenishment model




14) Do the hospital/grantee’s policies and procedures describe its process for the prevention of diversion at the parent entity and its off-site locations?


Document the section or page number that includes the following element

to address the eligibility determination system(s) including how:

i. A 340B drug order/prescription is generated from an eligible service location

ii. Outpatient status is definediii. Changes in patient status from outpatient to inpatient affects the use

of 340B drugsiv. A patient healthcare record is defined including which data in the

health care record determines eligibilityv. Provider eligibility is determined and a process for handling changes



in provider eligibilityvi. It is determined that the responsibility of care remains with the

hospital/grantee (including a referral process if applicable)vii. Service within the scope of grant is determined (grantees only)




15) Do the hospital/grantee’s policies and procedures describe its process for monitoring the 340B split-billing software program to ensure the prevention of diversion at the parent entity and its off-site locations?



I. Type of self-auditing activitiesII. Frequency of self-auditing activities

III. Maintenance of auditable records




16) Do the hospital/grantee’s policies and procedures describe its process for the prevention of diversion at its contract pharmacy(ies)?


Document the section or page number that includes the following element;to address the eligibility determination system(s) including how:

i. A 340B drug prescription is generated from an eligible service locationii. Outpatient status is definediii. Changes in patient status from outpatient to inpatient affects the use of

340B drugsiv. A patient healthcare record is defined including which data in the health

care record determines eligibilityv. Provider eligibility is determined and a process for handling changes in

provider eligibilityvi. It is determined that the responsibility of care remains with the

hospital/grantee (including a referral process if applicable)vii. Service within the scope of grant is determined (grantees only)

Date last reviewed/updated:





17) Do the hospital/grantee’s policies and procedures describe its process for monitoring the 340B split-billing software program of its contract pharmacy(ies) to ensure the prevention of diversion?



i. Process for performing self-auditsii. Frequency of self-auditing activitiesiii. Maintenance of auditable records

Date last reviewed/updated:



18) Do the hospital’s policies and procedures describe its process for complying with the orphan drug exclusion? (Applies to Critical Access Hospitals (CAH), Rural Referral Centers (RRC), Sole Community Hospitals (SCH), and Free-Standing Cancer Hospitals (CAN))



i. Process for complying at hospital and off-site locationsii. Process for complying at hospital’s contract pharmacy(ies)




19) Do the hospital/grantee’s policies and procedures describe its process used to prevent duplicate discounts at entity and off-site outpatient facilities?



i. State Medicaid Agency requirements for the prevention of duplicate discounts, including multiple state Medicaid agencies if applicable

ii. List all Medicaid provider number(s) /NPI number(s) used to



carve-in 340B drugs in the Medicaid Exclusion File at each registered site

iii. Process used to prevent duplicate discount for each Medicaid provider number/NPI number listed in the Medicaid Exclusion File

iv. Process used to ensure that 340B drugs are not billed to Medicaid for each Medicaid provider number/NPI number not listed in the Medicaid Exclusion File

v. Process for billing physician administered drugs to Medicaidvi. Process for billing outpatient prescription drugs to Medicaidvii. Process to ensure the accuracy of information contained in the

Medicaid Exclusion Fileviii. Process used to prevent duplicate discount when a drug is billed to

a State ADAP, if applicable




20) Do the hospital/grantee’s policies and procedures describe its process used to prevent duplicate discounts at its contract pharmacy(ies)?



i. Process used to carve-out Medicaidii. Process used to carve-in Medicaid including the listing of a carve-in

contract pharmacy arrangement on the 340B databaseiii. Process used to prevent duplicate discount when a drug is billed to a

State ADAP, if applicable


If response “No” or “Unsure” explain:


17) Do the hospital/grantee’s policies and procedures describe how the hospital/clinic defines a material breach and the process for when and how it would self-disclose?



i. Definition of non-compliance material breacha) Established threshold for what would constitute a material

breach of compliance that would require self-disclosure is



establishedii. Assignment of responsibility for material breach assessment

a) Articulates when, how, and by whomiii. Process for self-disclosure

a) How is self-disclosure to HRSA and/or manufacturers accomplished?

b) How are corrective action plans submitted, approved, and complete?

iv. Describes maintenance of records of materiality assessments and violations



This tool is written to align with Health Resources and Services Administration (HRSA) policy, and is provided only as an example for the purpose of encouraging 340B Program integrity. This information has not been endorsed by HRSA and is not dispositive in determining compliance with or participatory status in the 340B Drug Pricing Program. 340B stakeholders are ultimately responsible for 340B program compliance and compliance with all other applicable laws and regulations. Apexus encourages each stakeholder to include legal counsel as part of its program integrity efforts.

© 2016 Apexus. Permission is granted to use, copy, and distribute this work solely for 340B covered entities and Medicaid Agencies.

340b program policy and procedure self-audit tool

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