Attention 340B covered entities participating with Humana – Managed Care Medicare: Effective January 1, 2019, Humana requires that a “JG,” “TB,” or another relevant modifier be added to claims involving 340B eligible outpatient drugs under the Medicare Outpatient Prospective Payment System (OPPS) with status indicator “K.” If a claim does not include the proper modifier alerting Humana to the use of 340B drugs, Humana will automatically reduce the reimbursement rate to the average sales price (ASP) minus 22.5%.

This change by Humana resembles the January 1, 2018 decision by the Centers for Medicare and Medicaid Services (CMS) to reduce the Medicare allowed reimbursement rate for 340B purchased drugs from ASP plus 6 percent to ASP minus 22.5 percent. CMS simultaneously increased the conversion factor for all OPPS non-drug items and services by approximately 3.2%.

It may be prudent to reach out to Humana for clarity on this issue. A recent federal court ruling in Washington reversed the enormous cuts to the Medicare outpatient drug payments implemented by CMS. A federal judge ruled in late December 2018 that CMS and HHS exceeded their authority by cutting drug reimbursement by approximately 28.5 percent. While this ruling appears to be a win for the hospitals affected by the payments cuts, it is not certain how this issue will be settled. Additionally, there has been no guidance by Humana as to how this ruling affects its position.

We will continue to monitor the situation and update clients as more information becomes available. If you have any questions, please contact one of our 340B Apexus Certified Experts:

Jason Prokopik, Pharmacy Manager
jprokopik@blueandco.com
317-713-7916