ADAP Manual - 2003 Version
CONDITIONS FOR ENROLLMENT IN THE
SECTION 340B ADAP REBATE OPTION
Letter from the National Alliance of State and Territorial AIDS Directors
September 10, 1998
Enclosed please find the Conditions of Participation for State AIDS Drug Assistance Programs (ADAPs) and pharmaceutical manufacturers participating in the rebate option of the 340B program. As you are aware, the Health Resources and Services Administration (HRSA), Department of Health and Human Services, published a notice in the Federal Register on June 29, 1998 (63 FR 35239) recognizing the rebate option for State ADAPs under Section 340B of the Public Health Service Act. Since that time, the National Alliance of State and Territorial AIDS Directors (NASTAD) has been working in collaboration with the Division of Service Systems (DSS) and the Office of Drug Pricing (ODP) at HRSA, and the administrators of State ADAPs to develop a set of principles that will assist both ADAPs and manufacturers in a successful implementation of the 340B ADAP rebate option.
Through this collaboration we jointly developed a draft Conditions of Participation. These draft Conditions were shared with representatives of the Pharmaceutical Research Manufacturers of America (PhRMA) and approximately twelve individual manufacturers at a meeting on August 14, 1998, during which DSS, ODP and NASTAD received valuable and constructive input from industry members. We have since revised the Conditions to reflect the concerns raised by industry at this meeting.
It is important to note that the attached Conditions of Participation are not federal regulations or guidances; rather they represent a historical cooperative effort between ADAPs and the pharmaceutical industry to work out issues related to the implementation of the 340B ADAP rebate option. If you have additional questions, please contact Arnie Doyle at NASTAD at 202-434-8090.
Thank you for our valuable input and support during this process.
cc: Annette Byrnes, DSS, HRSA
Buctch Staley, ODP
Conditions for Participation in the ADAP 340B Rebate Option
This represents the conditions of participation in the rebate option under the Drug Pricing Program authorized by Section 340B of the Public Health Service Act (42 USC 256b) as implemented in 63 FR 35239, June 29, 1998.
I. ADAP Obligations
- The ADAP will submit rebate claims only for drugs covered under its formulary.
- Rebate claims will include the following data: national drug code number (NDC), drug name, number of prescriptions, total reimbursement amount per NDC, total units reimbursed, unit rebate amount (URA), and total rebate amount claimed.
- To support rebate claims, the ADAP will maintain the following data for three (3) years and make it available to the manufacturer, as needed to resolve disputes: name and address of dispensing pharmacy, prescription number, units dispensed, date dispensed or paid, and amount reimbursed. To protect patient confidentiality, no patient names or addresses will be included in the supporting documentation.
- The URA will be used only for purposes of the program administration and will not be disclosed to non-covered entities. The ADAP may confirm the accuracy of the URA with program officials of the Health Resources and Services Administration.
- Within 90 days after the end of each calendar quarter, the ADAP should submit a claim to the manufacturer for a rebated based on units purchased. Claims not submitted within 90 days after the end of a quarter will be carried over to a later quarterly submission, not to exceed one year from date purchased. Claims submitted for preceding quarters will be appropriately identified.
- The ADAP will respond and attempt to resolve any questions raised by the manufacturer within thirty (30) days of the manufacturer's request. The ADAP may amend it rebate to correct any agreed upon errors. If informal attempts at resolution are unsuccessful, the ODP Dispute Resolution Process, as published in 61 FR 65406, December 12, 1996, will be used.
- If any error is discovered after rebates are received, an adjusted claim will be submitted with the next quarterly submission.
II. Manufacturer Obligations
- Within ninety (90) days after receipt of the ADAP rebate claim, a rebate payment shall be made to an account specified by the ADAP, through a mutually agreed upon procedure. A manufacturer who has questions or problems with a rebate claim shall request clarification or additional information from the ADAP within sixty (60) days of receipt of the rebate claim. Rebate payments may be withheld beyond ninety (90) days only for specific disputed amounts, under one of two conditions: if the ADAP has failed to respond to the manufacturer's request for additional information within 30 days, or if a request has been field with the Office of Drug Pricing for a dispute resolution review or audit.
- Rebate payments will include a breakdown by NDC of actual rebate amounts paid, including the unit rebate amount. Prior quarter claims will be separately identified if included in the payment.
- The manufacturer will identify officials designated to receive and pay claims and conduct official business with the ADAP and update information as needed.