California DHCS Issues Self-Audit Demand of 340B Providers: How BDO Can Help Meet the Deadline

In the latest challenge to 340B Healthcare Providers, California's Department of Health Care Services (DHCS) issued a letter regarding fee-for-service (FFS) Medicaid billing for all 340B covered entities. The letter asked covered 340B providers to conduct self-audits of their claims for a period between December 2016 and December 2019 for drugs dispensed to Medicaid patients. View the recent article from CHA on the DHCS 340B audits. 

The self-audit requires providers to ensure that, following existing California law, the 340B providers/covered entities billed Medicaid at the actual acquisition cost of the drug plus an allowable dispensing fee. The letters required 340B providers to respond with the results of their audit within 60 days (including reporting any overpayments) or request an extension to DHCS.

Although 340B providers will typically have a process in place to ensure appropriate billing at cost for drugs dispensed to Medicaid patients, the process of self-auditing 100 percent of all claims over a three-year period within a 60 day period, including attesting to the accuracy of the self-audit, puts significant pressure on California hospitals already struggling to meet the impacts of COVID-19.

For more information on the DHCS request and extension, we can help you.