HRSA Updates 340B Compliance, Redefines Healthcare Practices
HRSA issues new directives redefining compliance for the 340B program.
Why it matters: Healthcare attorneys must understand these updates to manage compliance and reduce liability risks for their clients effectively.
- HRSA seeks feedback on 340B rebate model; comments due March 19, 2026.
- Federal litigation pauses 340B rebate model pilot; traditional discount model remains.
- Eli Lilly mandates claims-level 340B drug data from February 1, 2026.
- South Carolina requires 'TB' modifier for Medicaid 340B claims from April 1, 2026.
The Health Resources and Services Administration (HRSA) has released a significant update redefining compliance under the 340B Drug Pricing Program. This program is a cornerstone for providing affordable medications to the underserved, making compliance particularly relevant for legal counsel in healthcare.
HRSA is soliciting public feedback on a new rebate model, with a deadline of March 19, 2026, for comments. Due to ongoing federal litigation, the transition to a rebate-based system is on hold, maintaining the current ceiling price discount model.
Starting February 1, 2026, pharmaceutical company Eli Lilly will require 340B entities to report claims-level data through the ESP platform, illustrating increased compliance obligations for pharmacies and healthcare facilities across the U.S., as highlighted in their statement.
Further, South Carolina's new billing guidelines, effective April 1, 2026, mandate including a "TB" modifier on Medicaid claims, ensuring payments reflect the net acquisition cost. Read more about these local impacts.
These regulatory changes intersect with recent CMS reimbursement adjustments expected to lower outpatient spending by $280 million. These shifts demand that legal personnel in healthcare remain proactive, ensuring compliance and protecting client interests.
By the numbers:
- $280 million — expected reduction in outpatient department spending affecting 340B facilities.
- March 19, 2026 — deadline for public comments on the 340B rebate model.
What's next: Ongoing federal litigation will determine the future of the 340B rebate model.